I’m not going to beat around the bush; a house is a big purchase and a huge life milestone. You want to make sure you are making the right choice. Have you been wondering if it is worth it to take the leap? Are you overwhelmed by all the information out there? While there are many benefits of owning a home versus renting one, here are some of the top ones you’ll want to consider!
#1 – It’s a Great Way to Build Equity
First off, what does equity mean? Equity refers to the probable market value of your property against any liens (such as a mortgage). The longer you own a home and pay towards the balance of any liens, the liens will gradually decrease as the property value and your equity in the home increase. The larger the home equity you have, the more borrowing and purchasing power you earn towards loans for home improvements, funding your children’s education, or other consumer goods such as a car.
While you build your equity as a homeowner with regular payments, your credit score will also receive a nice boost!
#2 – Your Investment Gets Better With Time
Investing in buying a house provides a better return than most other investments, such as a car. Depreciation begins as soon as you drive the car off the lot, where owning a home behaves in the opposite, appreciating in value over time (depending on market conditions).
Though even an experienced local REALTOR® cannot predict precisely what will happen with your home value in the coming years, they can provide past values for the neighbourhood. Looking towards the trends on values on homes in the area will help gain some understanding of what you can expect.
#3 – Less Expensive Than Renting in the Long Run
Yes, really! When buying a home, there are, of course, many upfront costs—down payment, appraisal fees, homeowner insurance, etc. And, similarly, you are paying a certain amount per month. However, as stated in the first point, you are paying to own the home, and your personal net worth increases. Whereas, with rental properties, you are paying to use the landlord’s property to live.
Check out Renting vs. Buying: Which is Better For You for a more in-depth comparison!
#4 – Plant Your Roots
Options for rental properties are often limited in terms of location. Buying and owning your home means you get to CHOOSE where you want to live; the neighborhood and proximity to schools, parks, your employer, and other amenities. By this choice, you can be sure you will have pride in ownership, not only in your property but your community, by forming relationships with fellow neighbors, local services & politicians and taking part in community events.
#5 – Freedom to Customize Your Space
This might be the last on the list, but it is certainly not the least. Actually, this might be the best reason of them all! While renting, you are at the mercy of your landlord in terms of colour and style choices made and cannot alter them. Ownership offers you the freedom to make changes. Paint the walls, rip up that carpet, install a secret door—the choice is yours! To make the deal even sweeter, not only will these changes make the house feel more like home, but they can elevate your property’s value as well.
Of course, there are countless other benefits and considerations for purchasing a house. However, the best way to ensure you are finding the perfect home for you and your family is to work with your very own REALTOR®.
Don’t have one? I’d be happy to help—contact me today!
From the day that you move out of your family house, you dream of the day when you finally stop paying rent and buy your first home. But, as you may have discovered, buying a home is not quite as simple as it seems! There is a lot to consider when deciding whether or not to make the move into homeownership.
By buying a house, you’ll be taking on all the pros of being a homeowner versus a renter. But you’ll also be taking on quite a bit of responsibility and giving up on some of the advantages that come with being a tenant. That’s why, before you start your home search, it’s important to weigh the pros and cons of both renting and buying to decide whether or not you’re ready to become a first time homeowner.
Should You Buy or Rent: The Pros & Cons of Each
Repairs & Maintenance
First up in our comparison is every adult’s favourite topic of discussion about the home—repairs. As a tenant, the only thing you have to do when it comes to ongoing repairs and maintenance around the home and yard is call the landlord. They are typically responsible for taking care of any work that needs to be done—unless you’ve discussed an alternate arrangement—so you can just sit back and relax.
As a homeowner, though, repairs and ongoing maintenance are entirely your own responsibility. You’ll need to not only figure out what is wrong all on your own, but you’ll also be in charge of either fixing it yourself or calling in a professional to do it for you, costing you both time and money.
Decorating & Design
If you’ve ever wanted to switch up the light fixtures or even just paint a wall as a tenant, chances are you’ve experienced the headache of getting anything approved with your landlord. Since you don’t own the home as a renter, you need to ask permission from the owner before making any lasting changes. Otherwise, you could end up with a missing damage deposit when it comes time to move out.
If you own your home, though, any decor or design changes you wish to make, you can simply do! That picture-perfect bathroom accent wall you saw on Pinterest? Throw on some coveralls and get to work! The three-tiered deck you’ve been dreaming of? Stop by the hardware store and start building! The sky is your limit in your own house (well…the sky and your budget, of course!).
Decided you don’t like the neighbours and want to make a move? As a rental property tenant, just give your landlord the appropriate notice that you’ll be moving out and leave it all behind! As a homeowner, though, you’ll either need to sell the house to turn it into a rental property of your own to make a change.
Paying Rent vs Paying a Mortgage
While both renting and owning require you to make a monthly payment, they aren’t quite the same. Rent is similar to paying for a hotel room—it is an agreement between you and the property owner that you will financially compensate them for allowing you to stay in their space. A mortgage is more like making payments on your car—the more payments you make, the more of the home you own. This is called equity.
Another difference between the two payments is the amount being paid. Depending on the rental agreement between you and your landlord, your rent could be subject to change at your landlord’s discretion. This could leave you with a rent you can suddenly no longer afford, should an increase happen at the time of renewal. With a fixed-rate mortgage, though, you are guaranteed the same payments for the entire length of your term!
If you have a furry friend like me, you are no stranger to the struggle of finding a pet-friendly rental property. Most rentals don’t even allow for pets and those that do, often require an additional deposit on top of your down payment. But if you own your home, you can have as many pets as you want, no deposits or approvals required!
Every landlord is required to purchase insurance for their rental properties that can cover the home in a variety of ways. This doesn’t, however, include any of your possessions as the renter. If you are renting a property, you have the option of purchasing your own tenant’s insurance to cover your belongings in the home, but it isn’t required! On the other hand, as a homeowner, you are required to purchase home insurance to protect your property.
Other Differences Between Renting & Buying
Tax Benefits – Every interest payment a homeowner makes on their mortgage is a tax deduction later!
Security – Owning a home, the only ones who have a key to your property are those you’ve given them to. As a renter, though, your landlord also has access at any time, along with anyone they’ve given a key to.
Appliances – As a renter, you are subject to whatever appliances are in the home, which may not be quite what you want. As a homeowner, you can choose whatever appliances fit your preferences and budget!
As a renter, you’ll never have the pride and autonomy that comes with home ownership, but there are quite a few advantages to renting that may be better suited for your lifestyle right now. So before making the switch, take some time to seriously consider the benefits and disadvantages of each to decide which is right for you.
And if buying a home is where your heart is at, though, I’m happy to help! Contact me and let’s get started on finding you your dream home today!