08 Nov Renting vs. buying a home: A comparison
BUYING
Advantages
- May build equity and credit
- No landlord to answer to
- More stability (especially with schools)
- Possible tax benefits
- Can improve or upgrade home to your taste
Disadvantages
- Requires substantial money and paperwork up front
- Could lose money if home values decline
- Extra expenses beyond mortgage payments
- Rising home prices and low inventory in many markets
- Responsible for repairs and remodeling
RENTING
Advantages
- Fewer upfront costs and paperwork
- Freedom to be more mobile
- Not responsible for maintenance, repairs
- No need to worry about falling home values
- Build credit (if your landlord reports rent payments to the credit bureaus)
- No property tax bills
Disadvantages
- Landlord can raise rent or sell the property
- Choices may be limited depending on vacancies
- Might have to move multiple times
- Don’t build equity
- No tax benefits
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