PERSONAL BENEFITS
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Why Should You Own Instead of Rent?
8 Reasons Why You Should Own Instead of Rent
Why Should You Own Instead of Rent?
8 Reasons Why You Should Own Instead of Rent
Owning real estate is considered by many to be a great way to diversify your investment portfolio and create long-term financial stability—and not just for yourself. A 2022 report found that nearly two-thirds of Americans (65%) view homeownership as a way to build wealth that can be passed down to future generations.1
Contribute to your long-term net worth by building home equity. Unlike monthly rent paid to a landlord—100% of which is never seen again—some of the value of monthly mortgage payments would come back to you in the form of increased home equity. Even though you’re paying interest on the loan to the bank, you’re also paying down your principal, also known as the amount of the initial loan. In doing so, you’re increasing your home equity, or the percentage of the home that you own. This is money that you’ll be able to leverage in the future to take out additional loans or cash out if needed.
Benefit from appreciation on the home’s entire value—not just your equity. In assets such as stocks, your return is directly related to the money you invest. In homeownership, the benefits would extend beyond what you actually paid. It doesn’t matter how much you put down or how much home equity you have—you would be able to leverage any appreciation throughout your ownership on the entire value of the home if and when you decide to sell.
Make consistent payments for years—or even decades. Many rental agreements only last a year at a time, in between which points landlords have the ability to raise rent. When there are shifts in the economy such as high inflation, renters become vulnerable to costly rent increases year after year.2 On the other hand, mortgage payments can remain stable for decades, depending on the type of loan you choose.* Common fixed-rate mortgage terms carry a set interest rate for 15 or 30 years, during which time your monthly payments are less likely to change unless you sell or refinance.
Take advantage of tax incentives. Homeowners can leverage certain home expenses toward their taxes, which can potentially save thousands of dollars. While you may be put off by the amount of interest you would pay on a home loan, it can be used to reduce your taxable income. Additionally, property taxes and eligible home renovation projects including medical or energy-efficient improvements can be deducted on your annual tax filing.**3
While saving for your financial future is undoubtedly important, money isn’t the only reason to consider becoming a homeowner. There are a lot of ways in which homeownership can enrich your personal life.
Make your home your own with customizations. Being an owner means you can design your space to make it feel most like home. When you want to paint a room, change the countertops, or retile the bathroom, you don’t need a landlord’s approval to go for it. Create the home you’ve always wanted, and do so knowing that the money you put into home improvements affect the future of your investment—not your landlord’s.
Create stability in your living situation. When someone else owns where you live, you ultimately have no say in what the owner chooses to do with the property. There are any number of possible scenarios that could leave you scrambling to find a new place to live. A landlord could raise rent beyond your budget, plan an unexpected renovation, decide to rent to someone else—even put the home on the market to be sold. As a homeowner, you would maintain control over your property and enhance stability in your home.
Put down roots in your community. In addition to being a financial investment, homeownership can also encourage social and political investment in your neighborhood. One study from the National Association of REALTORS® found that homeowners are more than five times less likely to move in a given year than renters. This prolonged residency in a single location makes it more likely for homeowners to interact with their neighbors and get involved within their local communities, in both an effort to socially acclimate and collectively protect local home values.4
Take pride in your status as homeowner. One of the central tenets of the “American Dream” is the idea of homeownership. For many, it’s a symbol of personal achievement. Working hard to own, support, and maintain your own home is a way for many to feel a deep sense of satisfaction and gratitude. Take part in that feeling of personal fulfillment in achieving the incredible life milestone of becoming a homeowner.
Not sure how to get started? Learn more about buying your first home with these 10 tips. Wintrust Mortgage has a huge range of loan options to help us find the right mortgage solution for your individual financial and personal needs. When you’re ready to take the first step, get in touch with one of our loan experts.
The best way to get started is by becoming a Premier Buyer. This gives you a better idea of what you can afford, and saves you time when you start house hunting. Plus, Premier Buyers are more attractive to sellers by proving one is both serious about a prospective purchase and more likely to be able to financially follow through. Wintrust Mortgage offers an online application to become a Premier Buyer that’s fast, easy, and secure.
1 Keeping Current Matters, The Majority of Americans Still View Homeownership as the American Dream
2 USA Today, Rent is the 'largest contributor' to inflation. See where it is going up (or down)
3 CNBC, Paying a mortgage? These 5 tax breaks can save homeowners thousands of dollars
4 National Association of REALTORS®, Social Benefits of Homeownership and Stable Housing
*This pertains to our fixed-rate mortgages only. Rates may fluctuate on other programs after a certain time period. **Wintrust Mortgage does not provide tax advice. Please consult your tax advisor regarding the deductibility of interest. All approvals are subject to underwriting guidelines. A Premier Buyer is a conditional prequalification, meaning the file has been reviewed by a Loan Originator and Automated Underwriting System (AUS) approval has occurred. A formal underwriting review still needs to take place for a commitment letter to be issued. Wintrust Mortgage is a division of Barrington Bank & Trust Company, N.A., a Wintrust Community Bank NMLS# 449042. ©2023 Wintrust Mortgage.
Buying a home is an important life milestone that everyone deserves to achieve—but it also comes with a wide range of both financial and personal benefits that renting just can’t match. So, why should you think about buying a home and finally stop renting?
FINANCIAL BENEFITS