Why Renting Can't Beat Owning Your Home

by Emily Kerr
Loan Page Columnist

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Maybe you're renting a home and are considering taking out a mortgage to buy a new home. The loan process may make you hesitant because it does take a little work to get through it. Plus, being a renter is a pretty easy gig. But can you afford to not buy a home?

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The Renting Life

It's true that renters have a lot less to worry over much less a pile of mortgage papers. Renters don't have to deal with structural maintenance, landscaping, and lawn mowing. When a pipe blows, you call on-site maintenance to come fix it. Many rental units offer amenities such as
  1. » swimming pools
  2. » tennis courts
  3. » laundry facilities
  4. » weight rooms
  5. » clubhouses

In many respects, renting is pretty easy.

A New Life with a Home Loan

Once you sign the mortgage papers, it's your house. You're the one making the decisions, and you are free of the landlord's decisions. You choose to paint your house virtually any color (albeit housing associations may have rules on exterior colors) and renovate your home as you see fit.

Building Home Equity

In a rental, you can pour an unlimited amount of money into a landlord's pocket and gain nothing other than the roof over your head. When you own a home, your house is working for you while you're making mortgage payments. The longer you're paying principal, the more of it you own and the more equity that you have. This equity is the difference between what the house is worth and what you still owe on it, and equity allows you to borrow against your home for large expenditures like sending a child to college.

Tax Deductible

As a homeowner you're also making mortgage interest payments and paying property taxes. Both are tax deductible, and these deductions can definitely help make April 15th a little bit less scary.

The Final Analysis

Renting is a great short-term solution, but the advantages to your finances are immense when you own a home. So go ahead and take the plunge with a new home loan. You'll be amazed how great it feels to own your very own house.

Sources:

Your Path to Homeownership
Questions from First Time Homebuyers

About the Author

Emily Kerr is a freelance writer with over 425 articles published. She writes about everything from new home construction to new home loans and everything in between.

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