Typical rent vs. buy calculators, such as Freddie Mac’s, compare the total cost of renting and owning a home over the same period of time. While they do account for additional factors such as insurance, closing costs, maintenance, and appreciation, the final analysis is purely financial and often neglects additional benefits of homeownership: 

1. Stable Housing Payments 

Rental rates have consistently climbed by 31% over the past decade, but the principal amount of your mortgage payment can be fixed. Given the ever-increasing cost of living, the advantage of a fixed housing payment cannot be overstated. 

2. Nest Eggs and Savings Plans

Each monthly payment towards your mortgage pays down principal and helps pay off an asset that appreciates over time. Even those who purchase a home during different cycles of the housing market will always accumulate sizable equity over the years. 

3. Utilize Equity for Expected and Unexpected Expenditures 

Regardless of the market, homeowners eventually build equity in their home to utilize for expected and unexpected expenditures, such as weddings, home repairs, or even college tuition. 

4. Refinance Opportunities 

Rent vs. buy calculators never account for refinancing opportunities, which can significantly lower a housing payment. With rates at a 14-year high and a possibility of a recession, mortgage rates have a strong probability of decreasing within the next few years.

5. Freedom and Pride of Ownership 

Your home is a showplace that can be used for you and your family’s enjoyment. Homeowners experience a sense of community and have the freedom to renovate and live in their homes as they please. This dramatic lifestyle change isn’t often fully recognized until someone purchases their first home.  

If you’re tired of renting and interested in taking the step towards homeownership, reach out to our office today for additional guidance.