Buying a Home May Make More Financial Sense Than Renting One
Are you wondering whether or not you should buy or rent a home? Buying may sound scary but prices in rent have gone up more than you think. According to an article from realtor.com elaborates,
“The median rent across the 50 largest US metropolitan areas reached $1,876 in June, a new record level for Realtor.com data for the 16th consecutive month.”
Your housing plans will probably be interrupted by rising prices anyway but we will list some key differences that buying your home will be the best option, and more worthwhile for you.
If You Need More Space, Buying a Home May Be More Affordable
Buying a house may actually be more affordable than renting depending on how many bedrooms you need according to the latest data from realtor.com and National Association of Realtors. Below, the graph shows the monthly mortgage and median rental payment across the country.
The graph shows that it is more affordable to buy a home if you need two or more bedrooms. This graph is based on nationwide averages. If all you need is more space, owning a home could be the right move for you. This could give you more motivation to own a home rather than rent.
Homeownership Also Provides Stability and a Chance to Grow Your Wealth
A couple other benefits - equity and stability, come besides saving more money based on the number of bedrooms you need.
When buying a home, you agree to pay a fixed-rate mortgage every month. No matter the inflation in society with rising gas and grocery prices, your house payment will remain the same every month. This provides long-term stability, unlike rent that can end up going up monthly. An article from CNET dives deeper into this issue, “...if you buy a house and secure a fixed-rate mortgage, that means that no matter how much prices or interest rates go up, your fixed payment will stay the same every month. That’s an advantage over renting since there’s a good chance your landlord will raise your rent to counter inflationary pressures.”
Your net worth builds over time when you build your equity. As you pay your home loan over time and your home values continue to appreciate, so does your equity. This equity can then help you buy a bigger home later on in the future if you need. CNET goes more into depth on this topic,
“Homeownership is still considered one of the most reliable ways to build wealth. When you make monthly mortgage payments, you’re building equity in your home that you can tap into later on. When you rent, you aren’t investing in your financial future the same way you are when you’re paying off a mortgage.”
To Sum it All Up:
Buying is your better option instead of renting, especially when being able to build your home equity. Call me today at (310) 519-7670 to see what your best options are and what you can do when purchasing.