Homeownership Is a Good Financial Investment!

According to a recent report by Trulia, “buying is cheaper than renting in 100 of the largest metro areas by an average of 33.1%.” The report may have some people thinking about buying a home instead of signing another lease extension, but does that make sense from a financial perspective? Ralph McLaughlin, Trulia’s Chief Economist explains: “Owning a home is one of the most common ways households build long-term wealth, as it acts like a forced savings account. Instead of paying your landlord, you can pay yourself in the long run through paying down a mortgage on a house.” The article listed five reasons why owning a home makes financial sense:

Mortgage payments can be fixed while rents go up.

Equity in your home can be a financial resource later.

You can build wealth without paying capital gains.

A mortgage can act as a forced savings account.

Overall, homeowners can enjoy greater wealth growth than renters.

Bottom Line Before you sign another lease, perhaps you should sit with a real estate professional in your area to better understand all your options.