Why Is Buying Better Than Renting?
If you plan to stay forever in a certain place, buying is better than renting. Banks and mortgage brokers offer such a huge variety of loans that it is almost impossible not to find the right mortgage loan for your housing needs. Some loans will also help you invest in real estate or start a house flipping business. Debt is good if you know how to handle it and if you know when to stop.
Why is buying better than renting? Buying is better than renting because rents and mortgage payments are quite similar in most places. However, in the most expensive cities to live in the USA your dollars can buy less space than in other cities. If you are working in a region with a very high cost of living, a way to cut down the costs would be to move outside the city, refinance your mortgage (or short sale your house) and commute. But when the cost of commute is too high to make such a move worthwhile, then stay where you are. Play with your numbers and try to keep more money in your pocket! Any savings that you make could be directed towards reducing your principal. In this way, you will pay off the mortgage faster!
Moreover, buying is better than renting because of the following reason: when you buy a house with a home loan, you start to build equity in that property from the very first payment. A house is a useful debt - you get to live there, or you can use it to generate extra income while you buy it piece by piece, every month. This doesn’t happen when you rent. When you rent, you contribute to the landlord’s mortgage.
So if you look at things from this angle, then you can choose a house that is more suitable for your family, and pay a little more dollars than the monthly rent would be, or you can think about buying a small residential property for your family, and invest in a second home - one that you can rent either long-term or short-term. When you enter the debt cycle, do it right and use your pristine credit score to get the maximum out of the banking system. Talk with a real estate agent and see how you can split the highest loan amount that you can get between two properties and explore the market together.
The reason for most real estate purchases is to leave something behind, for our children. Real estate is an excellent investment because houses will always be valuable assets. But there are also many niches that you can specialize in, as a real estate investor. You may want to bet everything you have on commercial real estate. But a piece of wise advice is not to put all your eggs in one basket. So, if you have the support of your spouse and your marriage is strong, grow your investment portfolio! Look for vacation rentals, or take the plunge and explore the trend of tiny homes. Or maybe you have a big heart and are more inclined to help the poor or the ones with special needs. There is a shortage of affordable special needs housing as well.
So, whether you purchase a single family house or an investment property, it is better to buy than to rent. And as long as you keep your debts below 40% of your income, everything will be fine.
Popular Real Estate Glossary Terms
In commerce and business, margin as a general term is defined as by the difference between the amount of money spent on a product and the selling price of it. The margin usually appears as ...
The clear, open and active occupancy of real estate. For example, notorious possession is one of the tests for adverse possession. ...
The definition of abatement is a reduction of penalties or a tax deduction for individuals or businesses. It can often be accessed upon an overpayment of taxes, if the company or individual ...
How many days, months, or years are required before a new building has the desired occupancy ratio. The occupancy rate influences the amount financial institutions are willing to lend. ...
The Ellwood method based on a multiplier of mortgage-equity to determine the value of income-producing property. ...
The total destruction, razing, tearing down, breaking into pieces or pulverizing of a structure on a building site. Demolition usually occurs when clearing a building site either as ...
A form of life or disability insurance where a mortgagor insures a mortgage in the event of death or disability. The principal covered by mortgage insurance declines as the mortgage is ...
(1) Subunit integral to a larger unit. (Usually associated with furniture). (2) Permanent fixture or appliance which is not intended to be portable and cannot easily be removed. A home has ...
Borrower's right to redeem his property by immediately paying off the loan balance and any related costs. ...
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