As a follow up to our March seminar on becoming a homeowner, we wanted to provide a summary of why owning a home is a better financial option for most. There are other benefits in addition to financial benefits, but here we are going to focus on the financial advantages.
Realtor.com recently reported that:
“Buying remains the more attractive option in the long term – that remains the American dream, and it’s true in many markets where renting has become really the shortsighted option… as people get more savings in their pockets, buying becomes the better option.”
There is even proof that owning is financially better than renting:
1. The top 5 financial benefits of homeownership:
- Homeownership is a form of forced savings.
- Homeownership provides tax savings.
- Homeownership allows you to lock in your monthly housing cost.
- Buying a home is cheaper than renting.
- No other investment lets you live inside of it.
2. Studies have shown that a homeowner’s net worth is 44x greater than that of a renter.
3. By building equity, a family can build wealth. For example, a family that purchased an average-priced home at the beginning of 2018 could build more than $44,000 in family wealth over the next five years.
4. One argument some use against buying is that renting eliminates the cost of taxes and home repairs, but all the expenses the landlord incurs are already baked into the rent payment – along with a profit margin!!
Owning a home has always been, and will always be, better from a financial standpoint than renting.