The rent vs. buy debate is an important one to have prior to purchasing a home. There are advantages and disadvantages to each option and everyone’s circumstances vary greatly. Below are a few things to consider when trying to decide whether to rent or buy your next home.
How long am I planning on living in my next home? If your plan is to live in your next home for a few years, then owning a home might be to your advantage as the fees/costs you pay to get your mortgage will be spread out over the amount of time you stay at that house.
What interest rate and mortgage options do I quality for? If your credit isn’t as shiny as you would like it to be, and the interest rate and mortgage options being offered are not what you expected, it might be worth waiting on the mortgage and renting so you can work on rebuilding your credit.
If I decide to rent, am I able to come up with the money required to secure a rental home? Not only will you likely have to come up with a security deposit for the rental house, but you would also be responsible for renter’s insurance (if you decide to purchase coverage).
Won’t I qualify for a tax deduction if I have a mortgage? While it is true that the mortgage interest and property taxes you pay are eligible for a tax deduction, it would be worthwhile to check with your accountant to make sure that you would actually receive a tax benefit from the mortgage, especially if you can rent a comparable house for less.
Am I able to afford the maintenance on the home I want to purchase? When you are a homeowner you are required to maintain the property, not only including repairs but also homeowner’s association dues, if required. Renters typically are not required to pay for large maintenance items on a home they are renting.
Can I rent a home cheaper than I can buy one? If you are on the fence about whether to rent or buy, it can be helpful to look at home rental prices and compare it to what a monthly mortgage payment (including taxes, insurance and private mortgage insurance if required) might be, also keeping in mind a set amount of money that you would put aside for any repairs. Depending on the situation, it might make more financial sense to purchase rather than rent, especially if your monthly costs to rent would be more.
The Boise real estate market is ever changing. If you need help analyzing your situation and figuring out if buying a home makes sense for you, feel free to contact me.[idx-listings linkid=”360525″ count=”10″ showlargerphotos=”true”]