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The Big Picture: Why Buying Beats Renting

THE BIG PICTURE WHY BUYING BEATS RENTING SALE RENT Choosing whether to rent or buy a home is not an easy decision to make. Both options offer distinct advantages and disadvantages. For most people, however, the benefits of buying a home far outweigh the costs. WHY BUYING MAKES CENTS Renting is More Expensive in the Long Run bit ly/RentvsBuyCalcalator The New York Times website offers a free calculator that allows you to compare projected rental rates to projected mortgage and interest rates, letting you determine how long it would take for the cost of renting a house to exceed the cost of buying it. In most cases, it takes as little as three to five years, making homeownership less expensive over longer periods of time. D There is ZERO Equity in Renting Each time you make a mortgage payment, you build up equity. If you decide to sell your home, the more equity you have, the more money from the sale you get to keep. In contrast, between damage charges and cleaning fees, many renters actually owe money when they leave their rental properties behind. Renting Offers ZERO Price Stability Every year, rent costs rise by roughly 5%, meaning that what you pay in rent today will be approximately 25% higher in five years, 50% higher in 10 years, and so on. If you rent the same apartment for twenty years, in the end you will be paying at least twice as much as you did when you first moved in. When you buy a house, your mortgage rate will remain about the same throughout your period of ownership--whether you stay for five years, fifteen years, or fifty. RENT IS ON THE RISE Looking forward in 2013, rents nationwide are expected to rise. Partly a consequence of dwindling units, partly a consequence of would-be owners waiting out the housing market, rental unit prices have been growing at rates unseen in nearly 10 years. By the end of 2013, the cost of renting is expected to eclipse the cost of owning a house by 44 percent! BUY WHAT YOUR HEART DESIRES ADVANCED TECHNOLOGY ТОTAL PRIVACY COMPLETE AESTHETIC CONTROL Newly constructed homes are Even when rental units offer a degree of privacy, you are never free from the whims of your landlord, who has the right to interrupt your life whenever he chooses, and may bring in prospective renters to visit your property whenever he likes. When you purchase a home, you are in full control of who enters your wired for the latest technology, not only making it easier to connect to the internet and install home entertainment systems, but potentially increasing your home's security and reducing electricity costs. From kitchen tile to interior painting, renting gives you very little say in determining the way your home looks. Landlords expect their property to look the same the day you move out as it did the day you moved in. When you own your home, you can alter it as you please. property. ENERGY EFFICIENCY Unlike rental properties, which are often furnished with decades-old, energy-wasting fixtures, new houses often boast a number of energy efficient features. These include: high-quality insulation, high-performance windows, advanced heating and cooling systems, as well as efficient lighting and kitchen appliances. Modern products can reduce your utility bill by more than 30 percent in energy costs and tax breaks, leading to thousands of dollars in energy savings over time. HEALTH AND SAFETY TAX BENEFITS There are a number of health Unlike renting, owning comes with a number of potential tax dangers associated with older rental homes and apartments, including mold, asbestos, and lead paint, poor air quality, contaminated carpeting, and Chinese drywall. New homes, by contrast, use modern materials that increase energy efficiency and lower utility bills, keeping families safe and providing peace of mind. deductions and write-offs, including mortgage interest deduction (MID) and private mortgage insurance (PMI) deduction, among others. These deductions not only lower the tax burden at filing time, but can help make homeownership a cheaper option over time. FACT VS FICTION FACT: BUYING TIES YOU DOWN While renting provides a certain degree of freedom, allowing you to leave as soon as your lease is up, buying a home can become a valuable entrepreneurship opportunity, allowing you to rent out your home for profit. If you buy a home, you can move wherever you like while continuing to collect rent. FICTION: BUYING FACT: IF IT'S ALWAYS COSTS BROKEN, YOU FIX IT MORE UPFRONT Many people choose to rent because they can't afford the down payment on a house This is understandable; after Longtime renters are accustomed to the convenience of having their maintenance needs taken care of for them. Of course, when you own a home, you are responsible for taking care of your own maintenance needs--from plumbing to landscaping to heating. However, if you enjoy yard work and are home improvement-savvy, you may actually come to enjoy it. all, some lenders require as much as 20% of the home value upfront before they will loan the rest. However, it is important to note that some houses can be purchased with a no money down option, which can help you buy the home of your dreams for less upfront than a security deposit and the first and last months' rent on an apartment. Fortunately, with a homeowner's warranty. making home repairs is very feasible. FICTION: THE VALUE OF A DOLLAR IS FACT: HOMEOWNER'S INSURANCE IS CHEAPER ON NEW INCREASING Rather than buying a home now, some people feel more comfortable holding onto their money, waiting for a better opportunity to arise. However, it is critical to note that the value of money decreases over time, meaning that your money is never worth more than it is at present. Today's housing market is a buyer's market; whereas rents are rapidly rising, housing prices are even. This means that home buyers can currently expect to save tens of thousands of dollars per year over their renting counterparts. CONSTRUCTION Some people are afraid to purchase a home because of the cost of homeowners insurance. They often forget, however, that even when landlords don't demand it, renters need to get insurance too, since landlord insurance policies only cover physical structures, not tenants' belongings. While it's true that homeowners insurance isn't always cheap, it can be up to 15% cheaper for those purchasing newly built properties. HOMES Sources: http://www.energystargoelinder.efmlernew hemes hm index http/ http://www.ingewlpablications/p5a0/e02 html http/ THE LEADER IN AFFORDABLE NEW HOMES %24

The Big Picture: Why Buying Beats Renting

shared by LindaKinyo on Jul 25
With rent rates on the rise, the housing market is picking up more and more steam. Read on to become acquainted with the potential benefits or drawbacks to owning your own home.


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