Deciding on whether to make the move from renting to buying your first home is a huge decision. However, for many people, owning a home is well worth it because of the sense of security and stability that it brings versus renting.
When you become a homeowner you have the opportunity to eventually be mortgage-free, make long-term investments, and increase your net worth over time! As a renter you do not have this opportunity.
If you have been debating which option is best for you, read the 5 Reasons To Stop Renting And Consider Buying Your First Home below.
#1 - Buying A Home Builds Equity
When you purchase a home, your monthly payments over time build equity. But, what exactly is equity? Equity is the difference between how much your home is worth and how much you owe on your mortgage.
This can be a great financial tool that can be used towards larger expenses. For example renovations on your home, high-interest debt consolidation or even college expenses.
As a renter, the money that you put in month-to-month is money that you cannot get back, in comparison to buying.
#2 - Buying A Home Allows You To Build Wealth
When you rent, you are building your landlord's weath, and not your own. But, when you buy a home, you have the opportunity to build lifelong wealth through appreciation.
Appreciation is when a home increases in value over a period of time. Across the United States, on average, home prices typically double in anywhere from 10 to 20 years. With the national average appreciation rate being 3% – 5%.
For instance, if you purchase a property worth $200,000 and it appreciates to $220,000, you have already made a 10% return on your property.
#3 - Buying A Home Gives You The Opportunity To Lower Your Living Expenses
The idea that you might not have to pay for rent or a mortgage ever again is one of the most enticing things about buying a home! This is not something that you can do as a renter.
Of course, you will still have other expenses, like insurance and property taxes, but it can take a huge weight off of your shoulders! And most homeowners take pride in that accomplishment.
#4 - Buying A Home Gives You The Opportunity To Gain Passive Income
When you purchase a home you can gain financial freedom over time. After you have gained your use out of the property, you have the opportunity to rent it out, and gain a passive income.
Some first time home buyers even purchase duplexes, live in one unit, and rent out the other! With this day-and-age you also have the opportunity to start an air-bnb as well. The opportunities are endless!
#5 - Buying A Home Allows You To Make It Your Own
Tired of not being able to paint your walls, or change your flooring? When you purchase your own home, you can do it all! You could even knock all the walls down and start fresh if you wanted to.
Having a space that you can freely manage and control also gives a sense of stability and freedom. No more lease agreements, terms, or guidelines around what you can or cannot do when you purchase a home.
Bottom Line:
There are many reasons why you should consider buying a home and stop renting. While, buying may not be for everyone, it is definitely something everyone should consider. If you are looking to build your wealth, net worth, and have more stability in your life then this may just be the best decision you will ever make!
Not sure if you are financially ready, or just not sure where to start? Click the button below and we can help you on your journey to buying your first home. If you aren’t ready now, at least you can learn what to do to prepare for the future!
