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Top 5 Major Reasons Why it is Better to Own Than Rent

Owning a home has great financial benefits.

I am often asked, why should I buy a house? Is it better to buy a home vs renting? In a recent research paper, Homeownership and the American Dream, Laurie S. Goodman and Christopher Mayer of the Urban Land Institute explained:

“Homeownership appears to help borrowers accumulate housing and nonhousing wealth in a variety of ways, with tax advantages, greater financial flexibility due to secured borrowing, built-in ‘default’ savings with mortgage amortization and nominally fixed payments, and the potential to lower home maintenance costs through sweat equity.”

 

1. Housing is typically the one leveraged investment available

When you own your home it allows you to amplify any appreciation on the value of your home by a leverage factor. A 20% down payment results in a leverage factor of five, meaning every percentage point rise in the value of your home is a 5% return on your equity. If you put down 10%, your leverage factor is 10.

Example: Let’s assume you purchased a $300,000 home and put down $60,000 (20%). If the house appreciates by $30,000, that is only a 10% increase in value but a 50% increase in equity.

2. You’re paying for housing whether you own or rent

Some argue that renting eliminates the cost of property taxes and home repairs. Every potential renter must realize that all the expenses the landlord incurs (property taxes, repairs, insurance, etc.) are baked into the rent payment already – along with a profit margin!!

3. Owning is usually a form of “forced savings”

Studies have shown that homeowners have a net worth that is 44X greater than that of a renter. As a matter of fact, it was recently estimated that a family buying an average priced home this past January could build more than $42,000 in family wealth over the next five years.

4. Owning is a hedge against inflation

House values and rents tend to go up at or higher than the rate of inflation. When you own, your home’s value will protect you from that inflation.

5. There are still substantial tax benefits to owning

We know that the new tax reform bill puts limits on some deductions on certain homes. However, in the research paper referenced above, the authors explain:

“…the mortgage interest deduction is not the main source of these gains; even if it were removed, homeowners would continue to benefit from a lack of taxation of imputed rent and capital gains.”

Bottom Line

These are only my top 5 favorite financial benefits of homeownership but there are even more! From a financial standpoint, if you can achieve homeownership and opt for renting you may be cheating yourself. Owning a home is definitely better than renting if you have the financial ability.

Your local real estate expert is always happy to help.

Schedule a Free Real Estate Consultation

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Danielle Gaynor, REALTOR

Danielle J. Gaynor, RCC, MSRE

Residential & Commercial REALTOR®

Bennett Realty Solutions

work: 202-670-5471

office: 301-459-5040

e-mail: daniellegaynorhu@gmail.com

 

#DGRealEstateDMV #Goodmorning #Realtor #RealEstate #buy #sell #invest #equity #profits #homeimprovement #homebuyer #homeseller #homeowner #dc #md #dmv #baltimore #uppermarlboro #nationalharbor #capitolheights #takomapark #capitolhill #bowie #laurel #bethesda #silverspring #buyrealestate #sellrealestate #investrealestate #financialfreedom

why should I buy a house?

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Slaying the Largest Homebuying Myths Today [INFOGRAPHIC]

Slaying the Largest Homebuying Myths Today [INFOGRAPHIC] | Simplifying the Market

Some Highlights:

  • The average down payment for first-time homebuyers is only 6%!
  • Mortgage interest rates have been on the decline since November! Hop in now to lock in a low rate!
  • 88% of property managers raised their rents in the last 12 months!
  • The average credit score on approved loans continues to fall across many loan types!

Your local real estate expert is always happy to help.

Schedule a Free Real Estate Consultation

Danielle J. Gaynor, RCC, MSRE

Residential & Commercial REALTOR®

Bennett Realty Solutions

work: 202-670-5471

office: 301-459-5040

e-mail: daniellegaynorhu@gmail.com

#DGRealEstateDMV #Goodmorning #Realtor #RealEstate #buy #sell #invest #equity #profits #homeimprovement #homebuyer #homeseller #homeowner #dc #md #dmv #baltimore #uppermarlboro #nationalharbor #capitolheights #takomapark #capitolhill #bowie #laurel #bethesda #silverspring #buyrealestate #sellrealestate #investrealestate #financialfreedom

All Real Estate Blog Posts, For Sellers, Move-Up Buyers, Tips for Selling Real Estate

The KonMari Method: Helping You Prep Your House For Sale

One of the biggest challenges sellers face when listing their house is decluttering. Cleaning out some of the more personal decorating choices allows buyers to imagine themselves living in the house.

Those planning to sell soon are in luck! Marie Kondo, the inventor of the KonMari Method of Tidying Up, has gained popularity with her new Netflix series. She gives some great tips for sorting through years of accumulated possessions that we all collect in our homes.

“The KonMari Method™ encourages tidying by category – not by location – beginning with clothes, then moving on to books, papers, komono (miscellaneous items), and, finally, sentimental items. Keep only those things that speak to the heart, and discard items that no longer spark joy. Thank them for their service – then let them go.”

When you subjectively look at all of your belongings, you can sort through the ones that mean the most to you. Not only will you increase space for more joy-bringing items in your new home, but you will also have a much easier time packing remaining belongings!

“Remember, tidying up isn’t about getting rid of stuff. It is about creating an environment that sparks joy and improves your quality of life.”

When selling your house, first impressions matter! Before you or your agent schedule a photographer to take photos for your listing, make sure to tour your home with fresh eyes. Look for any imperfections that a buyer might notice.

When you sort through your more sentimental items, consider packing them away to ensure that you know where they all are. That way, they are safe during open houses and showing appointments. This will also cut down on the amount of packing you need to do right before you move!

Bottom Line

Whether you are selling your house to move up to a larger one, downsizing, or moving in with family, only bring the items that truly spark joy for you. This will not only help cut down on the items you move but also ensures that you’re off to a great start in your new home!

When you are ready – schedule an appointment with me using the link below:

Schedule a Free Real Estate Consultation

Danielle J. Gaynor, RCC, MSRE

Residential & Commercial REALTOR®

Bennett Realty Solutions

work: 202-670-5471

office: 301-459-5040

e-mail: daniellegaynorhu@gmail.com

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Services

Your local real estate expert is always happy to help.

Schedule a Free Real Estate Consultation

Danielle J. Gaynor, RCC, MSRE

Residential & Commercial REALTOR®

Bennett Realty Solutions

work: 202-670-5471

office: 301-459-5040

e-mail: daniellegaynorhu@gmail.com

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Schedule a Free Real Estate Consultation

Danielle J. Gaynor, RCC, MSRE

Residential & Commercial REALTOR®

Bennett Realty Solutions

work: 202-670-5471

office: 301-459-5040

e-mail: daniellegaynorhu@gmail.com