A question that buyers frequently ask real estate agents is: Is it smarter to buy right now or to rent a property? The answer to that question means a lot, especially to first-time homebuyers. It is also a question that doesn’t have a straightforward answer, and it depends on a couple of things.
1. Market rates. One of the biggest factors that trumps people when it comes to deciding whether to buy or rent is the market rate. Current rates have come down a bit compared to last year but are not yet back to where they were during the pandemic. If you’ve decided to buy a house now, you have the option of refinancing if rates drop in the future.
2. Long-term plans. If you are planning to stay in one spot for more than a few years, then it is better to buy a property. $2,000 of rent every month adds up to $24,000 a year that you can’t get back or get something out of. If you buy a house, the property will appreciate about 3% to 4% per year. You’ll have the opportunity to make some gains after five years.
3. Repairs and maintenance. The difference between owning a house and renting one is the responsibility to have it repaired when something breaks.
4. Tax benefit. Ultimately, all interest paid on a home you purchase and own is tax-deductible.
Overall, if you can afford to buy a house, if you qualify, and if you are going to be staying in the area for a few years, then I recommend that you buy the house as opposed to renting.
I hope you found this article helpful in deciding whether or not to buy or rent a house. If you have further questions about this topic or anything else related to real estate, feel free to call or send me an email. Me and my team will do our very best to help you.
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