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Owning a Home Can Be Cheaper than Renting

October 20, 2018 2:36 pm
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If you’re looking at Little Elm TX homes and can’t decide whether to buy or rent, a new study may convince you that buying is the way to go. Buying a home can save you money, especially in the long term, and will provide you with a house that is truly your own.

The Canadian study, carried out by Mortgage Professionals Canada, showed that buying a home helps people build a stronger financial base than they could by renting. Although in the short term it can be cheaper to rent than buy, in the long term it is a better financial move to buy a home.

While the cost of both owning and renting a home tends to rise every year, fixed-rate mortgage payments remain the same over time while your equity in the home rises. Therefore, your net worth is growing with every payment you make. Making a mortgage payment is akin to investing in an asset that is likely to increase in value over time. This helps build your net worth.

As a renter, you’re at the mercy of the market and your landlord. Rental prices usually increase every year. Your rent payments are helping to build your landlord’s net worth, not yours.

Most people find that their income rises through the years. People who own their homes will find that their increased income allows them to save more money or enjoy their lives a little more. Those who rent may find their rental payment keeping pace with their income.

Another drawback to renting is that you will never get your rent “paid off.” As long as you rent, you will be making payments. However, if you buy a home and make your payments on time, you will eventually get the home paid off. At that point you have 100% equity in your home and have no more payments to make. You can invest that money, use it to enhance your life or donate to worthy causes.

Owning a paid-for home is especially good for those nearing or beyond retirement age. Your smaller income in retirement will go further because you no longer have a housing payment.

Ready to buy a home? Call Landon Homes today at 866-898-3603 to learn more about Little Elm TX homes.

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