Rates May Be Rising, But Here’s Why Buying is Still Smarter than Renting

July 15, 2022


Rising Rates

It’s no secret that mortgage rates have inched higher this year. And while that’s certainly disappointing, it shouldn’t deter you from buying a home completely.

For one, rates last year were at historic lows. Rates like that have never been seen before, so right now, the market is just on its way to normalizing a bit.

On top of this, homeownership comes with a whole slew of benefits that just aren’t available to renters. And when you throw in skyrocketing rents? Buying a house may still win out for many Americans.

Are you on the fence about buying a home with today’s higher rates? Here’s why buying a house is still a smart idea:

1. You get to build equity.

Homeownership helps you build wealth — plain and simple. As you pay down your mortgage loan and as your home increases in value, your equity grows. And the more equity you have? The more you stand to profit once you sell your home.

You can also turn your home equity into cash using home equity loans, cash-out refinances, and HELOCs later on in life. You might do it to pay off debts, cover the costs of college tuition, or just renovate or repair your home. The options are endless.

2. You’re paying your own mortgage — not someone else’s.

When you rent, your money is paying off someone else’s mortgage, not your own. (It’s also helping them build equity, too). This essentially means you never see those funds again. You won’t see them when the property is rented to a new tenant, and you won’t gain anything when the property is sold later on either. Your rent is simply another monthly cost — not an investment like it would be if you owned a home.

3. You can personalize your home.

There are lots of limitations when you’re renting a property. You can’t paint the walls certain colors (or at all), you can’t attach things to the walls, and you often can’t have pets. Under these circumstances, it’s very hard to personalize your place and really make it your own.

Homeownership, fortunately, is nothing like this. Aside from any HOA stipulations about your home’s exterior, you’re typically free to customize your house as you wish. You can even renovate, add on, or install extra features like a pool, deck, or extended patio.

4. There are tax benefits.

Finally, there are lots of tax advantages to owning a home. You can write off the interest you pay on your mortgage loan, and you can also deduct your property taxes. There are other possible deductions too — like ones for your home office, for example. Renting doesn’t come with any of these.

Ready to buy a home?

Are you thinking about buying a house? Get in touch with Premier Nationwide Lending today. We’ll walk you through your options.

Premier Nationwide Lending is an Equal Housing Opportunity lender. Sponsored by NTFN, Inc. 6201 West Plano Parkway, Suite 100, Plano, TX 75093 | NTFN NMLS 75333.

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