Buying a home is a large investment, but it always pays off more in the long-term than renting one does. Here’s why.
When I’m talking to people who are currently renting and exploring the options of a home purchase, I often hear this question: Is buying a home better than renting one?
In most cases, the answer is yes. However, let’s say that you’re renting a home and thinking about buying, but you know that you’ll be leaving the area within a few years. In this particular case, homeownership probably isn’t the best idea because you won’t build up enough equity to make the purchase worth it. That is, unless you want to turn the property into a rental property to generate passive income.
“Buying a home isn’t the right decision in every case, but it is in most of them.”
If you rent a home for $1,800 for three years, that’s $65,000 spent on rent. What have you received in return? A home to live in, for sure, but no other financial benefits. If you buy a home with a mortgage payment of $1,800 a month, that $65,000 will go toward your rent, your taxes, and you’ll get a portion of what you spent back each year and will keep building your equity for the future.