In today’s economy, it’s a common strategy to try and keep expenses down, reduce costs, and “just hang on” while things rebound. And, with economic pressures pushing rents down, it can seem attractive to just rent for a while and “save some money.” so renting is cheaper than owning.
It’s better to rent than to buy in today’s housing market. Fast-rising home prices and higher mortgage rates have made it cheaper to rent a home than buy and own one. … Renting and reinvesting the savings from renting, on average, will outperform owning and building home equity, in terms of wealth creation. so renting is cheaper than owning.
In most cases, though, this is a misconception. Money paid out as rent is simply money spent. It’s like burning money – aside from the roof over your head for another month, the only person that benefits from that money is your landlord. On the other hand, if you pay that money out as a mortgage payment, not only is the roof still over your head, but your money can go to work for you in several ways.
For starters, every dollar of interest paid on your mortgage is tax-deductible. Typically, in the first five years of your new mortgage, *most* of your payment is interest and therefore is tax-deductible.
Another BIG tax break is available right now. If you write your contract before the deadline of April 30, 2010, Uncle Sam will give you an $8000 tax credit!
Plus, you always have the potential for future appreciation. On average, most homes appreciate 3% per year, often doubling (or more) the value of your investment over the term of your mortgage. Today, most homeowners find that their best investment made in the last 20 years is the home they live in. And, with real estate properties currently at historic lows, the potential for future appreciation has never been greater.
Finally, aside from the financial advantages, you have the powerful “Joy of Ownership.” Your home is now YOUR castle – not someone else castles that you’re temporarily living in. You can make it your own; paint the walls, pick out your favorite carpet, enjoy your gourmet kitchen, splash around in your pool… you get to decide how you live.
Today is a great time to buy a home, so start owning and stop throwing rent away. Contact us today and we’ll help you find your castle!
Jamie Thompson and The Thompson Group specialize in Phoenix Real Estate, Arizona area helping buyers find their dream home at a great price. Whether you are looking for an investment property, first home or vacation home, get started using our free custom MLS map search today!