In today's housing market, is it better to rent or buy? There are many factors to consider when deciding to buy a home, including your current cash flow, the local market, interest rates, and potential tax deductions.
Even though the Federal Housing Finance Agency reports that housing prices were up 7.3% from January 2017 to January 2018, rents are predicted to increase substantially over the next year, making it a good decision to buy a home.
In addition, Freddie Mac is reporting mortgage rates holding steady over the past two months. The weekly average 30-year fixed mortgage rate was 4.42percent for the week ending April 12, 2018. When mortgage rates are low, your buying power is much higher.
Keep in mind that home ownership is equal to a forced savings plan. Part of your monthly mortgage payment pays down the amount you owe, meaning you own more of your home, and will more than likely get that back when you sell it.
Homeowners can also able to take advantage of tax deductions. They can deduct interest on the first $750,000 of mortgage debt on a home and up to $10,000 in state and local taxes, including property taxes.
Christine Aubrey, broker/owner of Coldwell Banker Upton-Massamont Realtors in the Pioneer Valley said “Rents have steadily increased and are showing no signs of slowing down. When you buy a home, you are not only building wealth, you have the ability to lock in your housing expense.”