Debt from student loans or other sources, a lack of starter homes on the market, and the aftermath of the recent mortgage crisis leaves many people with one question: Is buying a house still worth it? In short, the answer is yes. It’s no secret that, as Realtors, we believe in the pride and investment that comes with homeownership.
In comparison to renting, buying a home is generally more cost effective. This holds true for properties across the nation, according to a study published by trulia.com. The study found that, on a national basis, buying a home is 37.7% cheaper than renting. If you’re certain you won’t have to face relocating any time soon, buying a home can save you money.
Another aspect to consider is where the money you pay as a renter is going in comparison to where that same money would be going if you were a homeowner. Unlike paying rent money, paying money toward a home is your investment, not someone else’s. A recent paper from the Joint Center for Housing Studies at Harvard University explains:
“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return. That’s yet another reason owning often does—as Americans intuit—end up making more financial sense than renting.”
From an investment perspective, profiting on flipping a house or renting is very much dependent on the current market, which can change quickly. However, building equity and planning a low cost of living in retirement is always a good strategy.
Looking beyond the financial benefits of buying a home, being a homeowner also gives you much more freedom than you would enjoy as a renter. In addition to customizing a home to your taste, you also don’t have to face the potential of having to relocate if your landlord decides to change terms or sell the property.
There are many questions and circumstances that might make you feel uncertain about buying a home, but the facts remain that purchasing is still a good investment. Are you interested in buying a home in Southeastern Michigan? Bittinger Team, REALTORS have been helping home buyers and sellers in Canton, Plymouth, and Northville, MI for over 33 years. Contact us today.