For many people, when you own a house, it brings with it a sense of joy and pride together with the freedom which cannot be matched by renting. When you own a home, there are no landlord rules and payments on a monthly basis are your building equity. It is important that, though buying a home is your way to your long term building wealth, here are some of the pros and cons that accompany it as expressed in Roofstock review.
- The main advantage is that now you own your own home. You can change the landscape, paint the kitchen blue, install a hoop for basketball, or create a movie theatre in your unfinished basement. As long as you are working within any zoning or building regulations, you are at liberty to do what you feel like.
- Some of your monthly mortgage payments might come back to you in equity form. When you are renting, there is no way you will see that money coming back to you. On the other hand, your equity will be built through part of your mortgage being applied on the loan principal.
- Due to the fact that your home might become an asset, you have the potential to make cash if you sell it for a value higher than what you bought it for. The profit might even be tax-free. There is a possibility that you might tap into your home equity while you are staying in it to consolidate debt or make some improvements.
- There are additional tax obligations when you own a home. The property taxes and mortgage interests you pay are normally deductible. This means that you are lowering your tax burden on the overall.
- Though buying a home comes with many advantages, there are also disadvantages. When you rent a house, whenever there is a leak or some problem, you just have to call the landlord and it is fixed. Now that you are the owner, it will come with unexpected repairs and maintenance costs, which will not be there if you were renting.
- There is the potential to lose money on the house. While in most instances there is a chance for the value of the real estate to go up, there are times when the value stagnates or even declines. Depending on the cost which is associated with the actual amount and sale for the house, you might end up losing money.
- To buy a home is a long term proposition. When renting, you are only bound to an annual lease or month to month payment, and thus, moving or picking up can be done in a very short notice. When you purchase a home, it is not easy for you to pick up and move. You have a strong financial obligation and the process to sell the house might take a long time.
So when you are purchasing a home, you should first consider the pros and cons before you make your final decision.