TO OWN OR RENT?

The Case For Home Ownership 

Homeowners report considerable higher rates of satisfaction than renters with their housing. A variety of reasons include: 

Equity Build-Up. People believe in the investment wisdom of owning a home and accept mortgage payments as a benign forced savings plan. For most homeowners, housing prices move up more quickly in good times than they decline when the economy sours because homeowners shy away from selling property during recessions. 

1.  Home ownership also means the right to control your domain. A lender can’t send homeowners packing unless they stop paying their mortgage loans. Landlords may force tenants out at the end of the lease. Owners can paint their walls with pink polka dots and install water beds and ceiling mirrors if they like. Owners enjoy “security of tenure” with no landlord interference, although purchasers of condos, co-ops and houses in planned developments with homeowners associations surrender considerable autonomy to their co-owners. 

Housing Cost Predictability. Most homeowners have long term mortgage debt while renters owe their landlords nothing once the lease expires. Yet, homeowner are thought to be better off than renter for having surrendered their rented apartments. Housing rents tend to rise with inflation while the real housing occupancy costs of homeowners tend to decline over time. This is because the largest component of housing costs—mortgage payments—are written for long terms at rates of interest that are fixed or adjusted according to formulas that lag well behind inflation. Homeowners escape control of the landlord who can raise rents as high as the market will bear with each lease renewal. In fact, some  landlords increase the rent even when the value of the apartment has been enhanced by improvements made solely at the tenant’s expense. 

Tax Benefits. The mortgage interest and property tax deduction provide relief to the homeowners who itemize deductions. 

Housing As a Social Good. The housing industry provides jobs and encourages the purchase of goods such as appliances, furniture and landscaping. Local property taxes account for a large portion of revenue raised by local governments. Homeowners contribute to community stability—they move less frequently than renters and are more likely to participate in non-professional organizations and to vote. 

The Case For Renting

Time and Effort. The homeowner has no landlord to yell at when the roof leaks or the sink stops up. For better or worse, the homeowner accepts the role of general contractor, taking bids and overseeing the inevitable. Homeowners are responsible for maintenance, insurance, utilities and property taxes. 

Uncontrollable Costs. Many uncontrollable (and some unpredictable) bills await the homeowner: taxes, insurance, maintenance and adjustable mortgage rates to name a few. While the homeowner can defer some repairs, budget-breakers—like plumbing or roofing emergencies—can occur at the least opportune times. 

If you’re thinking of taking steps towards ownership, the DuPree Team would be delighted discuss and evaluate your real estate needs and current market trends in further detail. Call us today at 954-752-1986 to turn your dreams into an address!