5 Reasons to Buy a House Rather Than Rent

Deciding to buy a home is a major decision. And, for those of us who still rent an apartment or house, there’s an important question to answer: Do the benefits of homeownership outweigh your reasons to continue renting?

Here are five reasons to buy a house now that might help you say “goodbye” to renting and open the door to homeownership.

1. It might be less expensive to buy than to rent

Did you know that in two-thirds of American counties it’s cheaper to buy a home than it is to rent? That’s what the Urban Institute has discovered.

Since the Great Recession, rent has increased dramatically. Today, the typical renter spends 26 percent of his or her income on housing compared to the typical homeowner who spends 16 percent.

With more money going to rent, families often must deplete financial resources that could be invested in other ways.

2. Rental costs increase but fixed-rate mortgages don’t

There is no such thing as a 30-year lease that locks in your rental payment. Depending on your lease agreement, rentals are likely to go up from year to year.

In contrast, rising home prices do not affect a homeowner’s fixed-rate mortgage. As a matter of fact, rising housing prices can be a good thing for homeowners because they increase the home’s worth and equity.

With a fixed-rate mortgage, monthly payments only increase if the property taxes and property insurance costs increase. The principal and the interest portion of the mortgage payment is fixed.

3. Buying a home increases stability

Homeownership offers stability. Here’s how:

As your housing costs stabilize because rising rentals are no longer looming over your wallet, you can begin saving more money for:

  • Retirement
  • A vehicle (and vehicle maintenance)
  • Travel
  • New furniture or refinements to your home or yard
  • College funds for your children
  • Medical needs
  • A rainy day

Plus, you’ll give up wondering when the next rate hike will hit, prompting you to deal with things like finding a new place to live, scheduling movers, and making time to relocate while juggling work and family responsibilities.

At the same time, if you have (or plan to have) children, they likely will benefit from the stability of homeownership, too.

Again, according to the Urban Institute, researchers have found that a stable home is important for a child’s academic achievement.

Frequent moves can affect how a child performs academically because moving often means changing schools as well. A child who remains in his or her school is more likely to have the benefits of consistent instruction, fewer absences and a chance to develop close friendships.

4. A home provides space for your children to grow, family and friends to gather

Imagine:

  • Children running through the sprinkler in the backyard or kicking a soccer ball to their neighborhood friends
  • Seeing your kids go door to door at Halloween or walking around with their cousins during the holidays to see decorations
  • Packing up the car in the family driveway as your eldest child prepares to head off to college

These are the memories that we all want for our children, in a place they can stretch and grow.

When a family is in a home of their own, everyone is more apt to feel that they belong to the neighborhood and a community around them. Children in supportive, active communities tend to grow into resilient and healthy adults.

A home is also a place to welcome your extended family and friends.

Think of holiday gatherings, birthday parties, football watch parties, backyard barbecues. These are all made that much more enjoyable when you’ve got your own place to host loved ones.

5. You OWN it

Few things compare to the pride of owning your own house. And just think of all the things you can do with a home you can call your own:

  • Paint the walls
  • Hang up whatever pictures you want, wherever you want
  • Add landscaping or put in a vegetable garden
  • Build your dream man cave, she shed, craft room or kitchen

When you own a house, you and your family can create the home you’ve always wanted. Say goodbye to landlords or leasing companies who are unresponsive or who refuse to improve rental living conditions.

Sound good?

Let us help you find the right financing for your new home

After deciding that homeownership is the right next step for you, you’ll want to find the right financing. And that’s where Domain Mortgage, an affiliate of RBFCU, can help.

Depending upon your unique situation, income and goals, our dedicated and knowledgeable Mortgage Lending Team may be able to help you with the following financing options:

  • FHA loans are mortgage loans backed by the Federal Housing Administration. This type of loan is often a good option for first-time homebuyers seeking a loan with lower down payments.
  • VA home loans are offered to military service members, veterans and eligible surviving spouses. This type of loan often does not require a down payment, and there is no need for the Private Mortgage Insurance (PMI) that conventional and FHA loans require. This could lower your monthly mortgage payment.
  • Conventional loans are ideal for those with good or excellent credit. This type of loan typically follows conservative guidelines for credit scores, minimum down payments and debt-to-income ratios. The loan is available for vacation, rental and primary residences and is perfect for those seeking to make a larger down payment or refinance.

Plus, if you’re concerned about a low credit score but also earn a good, steady wage and have a low debt-to-income (DTI) ratio, then a good lender like Domain Mortgage may be able to help you find solutions for that, too.

Curious to learn more about how you can buy a home rather than rent? We’re happy to help you explore mortgage loan possibilities. Contact our experienced, dedicated Domain Mortgage Lending Team today at 1-833-552-7759 or visit domainmortgage.com.

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RBFCU Retirement Program, a financial advisory practice of Ameriprise Financial Services, LLC, is a division of RBFCU Investments Group LLC.

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