There’s a lot of confusion out there about renting vs. buying. If you’ve gotten caught up in apartment reviews and housing market news and don’t know what to do next, don’t worry. Today we’re busting four major myths about renting and buying to make your search for a new home a little bit easier.
Myth #1: It’s always better to buy than rent.
Truth: This one isn’t true at all! The fact is that whether you ought to buy or rent depends on your situation. How long will you live there? What is your budget? What is your credit like? How much space do you need? What do apartment reviews say about your prospective properties? What is available in the city or neighborhood that you like? The answers to all of these questions (and many, many more) will help determine whether you should rent or buy.
Myth #2: Renting is a waste of money.
Truth: When you rent, you have the advantage of flexibility. As a renter you can choose short-term leases, pay month-to-month, sublease, or stay at an apartment as long as you like. You also don’t have to handle most major maintenance issues yourself. Buying a home has its own perks, but renting is definitely a viable choice for those looking for a little flexibility and convenience.
Myth #3: Renters don’t have to worry about extra expenses like property taxes and maintenance.
Truth: Unfortunately, this isn’t the case. Expenses like property taxes, maintenance, and insurance are built in to your monthly rent bill. Sometimes renters are also required to have additional renter’s insurance before signing a lease. Just because you’re renting a property doesn’t mean you’re not funding its upkeep. However, reading apartment reviews before you settle on an apartment can help you determine whether or not a property is worth the price tag, so be sure to evaluate cost vs. value before choosing a new home.
Truth: When you buy a home, you can get a mortgage interest deduction, a property tax deduction, and a PMI deduction. But to take advantage of those deductions, it depends on a) what tax bracket you are in, and b) whether or not you itemize your deductions. Less than 30% of tax filers choose to itemize their deductions. Even if you do choose to itemize, you still ought to try to calculate what you’ll pay with deductions before you make a decision. The bottom line is that buying can prove to be a smarter choice financially, but only if you take the right steps to make it happen.
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