19 Oct Should I buy or rent my next home?

One of the most important decisions that people have to make is where they are going to live. When choosing where they are going to live, the first factor to consider is whether they want to rent or buy their next home. For those that are struggling to determine whether they want to rent or buy, there are several different factors that they should take into consideration.

Time You Expect to Stay

One of the most important factors that you need to take into consideration when determine whether you want to rent or buy is how long you are going to stay in the home. Purchasing a home is definitely a long-term decision. When buying a home it normally takes at least three to five years before a homeowner will break even on the purchase after price appreciation and mortgage amortization. This is because homeowners will spend thousands of dollars closing on the home and then possibly tens of thousands of dollars selling a home due to closing costs and commissions. If you thing you may need to move in the next few years, then it would be wiser to rent.

Employment Security

Another factor that is very important when choosing whether you should buy or rent a home is whether you consider your employment to be secure. If you have recently switched jobs, or do not have a stable career, then you will be taking on a significant amount of risk when buying a home in the event that you lose your job or switch to a job that does not pay as well. However, if you are in a stable job and expect to earn even more money in the future, then purchasing a home could be a great option.

Tax Considerations

While most people do not consider the tax implications that come with purchasing a home, owning a home could be one of the best tax moves that you ever make. When you own a home you will be able to write off a lot of the expenses that come with homeownership, including mortgage interest, real estate taxes, and even private mortgage insurance. You will also be able to take advantage of various tax credits if you make energy efficient improvements to your home. If you are looking for a way to reduce your federal or state tax liability, then purchasing a home could be a great option.

Conclusion

In conclusion, choosing a place to live is one of the most important decisions that you will ever have to make. When looking to move into a new home, you will have to decide whether you want to purchase or rent your next home. When deciding whether you want to rent or purchase the home, there are several factors that you need to take into consideration to figure out which option would be the best for you.