Benefits of Buying Over Renting
Buying a home remains a key part of the American dream for most people. A recent survey by Freddie Mac revealed that 91 percent of renters believe homeownership is something of which to be proud. And many younger renters are making plans to buy homes in the near future. In fact, nearly half of renters in the 25 to 34 age bracket – and nearly 60 percent of renters ages 35 to 44 – indicate that they plan to buy a home in the next three years.
There are many reasons to buy instead of rent. Financial benefits are arguably the biggest factor. Buying a home is an important step in accumulating personal financial assets over the long term. Home equity represents the largest share of net worth in the majority of households. Being able to pass on this wealth to the next generation is a huge incentive for most people to buy.
Unlike your average car, if a house is taken care of it is likely to increase in value over time. An immediate financial benefit you’ll see is the monthly payment on your home will remain stable for the length of the fixed-rate mortgage loan. Although you’re now responsible for all home maintenance costs, rising rent prices will no longer have to be factored into your budget.
The emotional benefits of owning a home is something many people find invaluable. You’re the landlord now, so you have the freedom to paint the walls or tear them down. You can add a privacy fence or build a firepit in the backyard. There’s no pet rent to pay. You’ve also put a lot of time into finding the perfect house, and you’re likely to enjoy becoming involved in the surrounding community.
There are, of course, a few situations when buying a home might not be the most beneficial course of action. Renting is likely the right decision for families planning to stay in an area for only a few years. The cost of closing fees and other buying expenses would not be financially sensible to pay if looking for short-term living arrangements. However, there is a breakeven point when the cost of renting exceeds that of buying. According to Zillow, it can take as little as six months for this to happen, but a more reasonable estimate for the Kansas City area is one to three years.
Buying a home is a milestone to be celebrated. Whether you’re planning for the future, actively searching for your first home or have been through the buying process before, we hope you find what you’re looking for on the Fall Parade of Homes, Sept. 22 – Oct. 7.