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Ah yes, the age old debate of “to rent or to buy?”. There are merits to renting, but there are also merits to home ownership. The question is, should you take advantage of the opportunity to own real estate today or not? If you are only going to be in a city temporarily or for an uncertain period of time, then it often makes the most sense to just rent. However, if you have found the city of your dreams and you plan on staying there for the foreseeable future, here are the three top financial reasons that you should consider owning the home you are going to live in rather than paying someone else’s mortgage. Since, let’s face it, you are going to pay SOMEONE’S mortgage, it might as well be your own!
Reason #1: Financial Stability
Home-ownership is one of the key-stones of building financial and mental security. No one ever wants to receive the phone call of “hey, you need to move out by X date due to X reason”; the stress to your wallet, your brain and your life can be overwhelming in these circumstances. High rental costs in most major cities can trap an individual in a perpetual renting cycle where the majority of your income is spent on housing and essentials and makes it impossible to save up for anything! Breaking away from the rental-rat-race enables one to achieve greater financial stability, security and platform to plan for the future. There are various ways to come up with the down-payment required to make that initial purchase and perhaps one of the most important things to consider when jumping out of the rental pool is that you don’t have to buy your dream home the first time. Stepping stones are a great way to move your way through the real estate market (i.e. condo, then townhouse, then detached home etc). When your money is invested into your principal residence, you will likely see that investment grow over time, depending on your marketplace, of course.
Reason #2: Creative Freedom
This is perhaps not the driving factor for all real estate purchases, but when considering the principal place you reside and the large chunk of change you put out each year to maintain a roof over your head and four walls around your stuff, there is something very gratifying and empowering about being able to change the colour, shape and configuration of those walls without having to ask anyone’s permission and without fear of losing your dollar value in to someone else’s investment. When you own your own home, you have the liberty to be creative within your spaces, to open walls or close spaces, to change your colour schemes on a whim or to reconfigure the floor plan and try any DIY project you have seen and thought, “WOW, I’d love to have that feature in my home”. If you are going to spend countless hours of your life within and lots of money monthly on a home, why not let it be a home you can call your very own?
Reason #3: Build Equity
That highly inevitable value increase over time in real estate is called ‘equity’. Many folks are afraid of debt and having a huge mortgage, but the hard fact is that you either build your own equity or someone else’s; you are paying your mortgage or theirs. Perhaps you are not comfortable with the mortgage being YOUR responsibility and that is fine, it is truly not for everyone at the end of the day, but I have come to observe over my last decade in selling real estate that most people would rather their hard-earned dollars go towards building financial security and equity for themselves rather than someone else. Owning real estate is the key for most people to get a foothold into solidity; for most, their own home is the largest purchase they will ever make and it is not one to be taken lightly, certainly. Home-ownership is an opportunity to put your money in a safe, long term investment where it’s almost guaranteed to grow in the long run.
Investing in real estate, whether it’s your principal residence or a purely investment property enables one to gain financial stability, exercise creative authority and build equity over time in one of the most popular investment vehicles used by the wealthiest folks in the world. I am not suggesting anything new here, I am simply taking a leaf out of the 1%’ers handbook and sharing it.
If you have questions or comments, I would love to hear from you today and would be happy to help in anyway I can on your purchasing journey. Call or email me today!
