Should I Buy a Home or Continue to Rent?

Buying a home presents several advantages. Sold Home For Sale Sign on Burst image by Andy Dean from Fotolia.com

Living the American Dream

Buying a home--considered an essential part of the American Dream--gives you numerous advantages. First of all, a home owner builds equity over time while paying on the mortgage. This acts as a sound investment even if the home's value does not appreciate. Home buying gives you certain freedoms, such as remodeling to suit your personal preferences, that may not be permissible when renting. Additionally, you may qualify for tax credits not offered to renters.

Renting with Fixed Costs

A major advantage to renting a property includes your ability to move out when the lease is up. The fixed costs associated with renting should also be considered, because you are neither losing or gaining equity throughout the lease. Another way you may save money by renting is that the maintenance costs are typically the landlord's responsibility.

Bottom Line

Although the initial deposit for a rental home may be less than a down payment, buying a house within your budget still presents an opportunity to build equity regardless of the home's value. If the property value increases and you decide to sell, then you have potential to make a great profit.

References

• Our Family Place: Field Guide to Buying vs. Renting