Have you put off owning a home because of the obligation of having a mortgage? Regardless, you are paying a mortgage – either your mortgage or your landlord’s.
As a recent paper from the Joint Center for Housing Studies at Harvard University explains:
“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return. That’s yet another reason owning often does—as Americans intuit—end up making more financial sense than renting.”
What are the benefits of owning over renting? If you purchase with a 30-year fixed rate mortgage, your ‘housing expense’ is locked in over the thirty years for the most part, depending on what type of loan you choose. If you rent, the one guarantee you will have is that your rent will increase over that same thirty year time period.
Something to think about………
Information provided by the KCM Blog