4 Surprising Ways Homeownership Boosts Your Financial Future
It’s no secret that homeownership is one of the best ways to build wealth. In fact, the average homeowner’s net worth is almost 40X greater than a renter’s!* But it’s not always easy to decide whether to buy a house or keep renting. When weighing the pros of renting vs. buying, it's important to remember that while renting can offer immediate short-term flexibility, owning your own home is almost always a better option long-term.
Financial Benefits of Owning a Home
You are building wealth for you and your family instead of building your landlord’s wealth.
You may get some unexpected tax benefits & deductions.
You’re creating a lasting legacy with an appreciating asset.
Your payment is locked in so you don’t have any surprises down the road. (Let's talk more about this one!)
Homeownership = Financial Stability
With a fixed-rate mortgage, your principal and interest payments stay the same, giving you a predictable, stable cost every month. Contrast that with rent, which often goes up with each lease renewal. Homeownership protects you from those annual increases and helps you plan your finances with greater certainty, allowing you to build equity without the surprise setbacks!
When you make monthly mortgage payments, you’re building equity in your home. When you rent, you aren’t investing in your financial future the same way you are when you’re paying off a mortgage. - CNET
But What About the Up Front Cost?
Purchasing a home has a much higher up-front cost once you factor in a down payment, closing costs and fees, etc. But for the long term, the math favors homeownership over renting in most cases. And the good news? There are a lot of programs designed to help first-time homebuyers overcome these short-term hurdles and get started building wealth for themselves and their families.
If you’re currently renting and are curious to learn more about your options, reach out to me or anyone on the Bridge to Portland Group team to discuss the Portland market or for a mortgage lender referral! We have a trusted network of knowledgeable lender partners who have been known to work some magic for first-time buyers. Homeownership might just be more attainable than you think!
You can read about how I’ve helped other first-time homebuyers purchase their first home here and here.
*Source: The Federal Reserve’s Survey of Consumer Finances (SCF)
