For those who can afford to make a choice, there is a serious debate to be had about the benefits of homeownership. On the one hand, you gain a greater degree of independence and freedom from monthly rent payments. On the other hand, there are still costs and rules associated with home ownership. For those of you who might be sitting on the fence, we would like to present the five biggest disadvantages of renting a home.
The Disadvantages Of Renting A Home:
It should be noted that these are broad categories rather than specific benefits. Obviously, we cannot write an article that will cover every situation, but we hope that this will give you some interesting food for thought.
Fewer Choices
When you rent a home, you will normally have a set of rules from the landlord that must be followed. If these rules are broken, you can be charged extra on the rent or even booted out entirely. Homeowners, on the other hand, only need to worry about obeying any laws that apply to their property.
Let’s say you want to get a pet? If you rent your home, you will probably need to check with your landlord first. Wouldn’t it be nice if you could just make that decision without interference? Some landlords will also get mad if you have too much company. while others will aggravate you to keep the grass trimmed. Again, wouldn’t you rather decide when to trim the grass or who can visit your home? Owning a home puts more of your choices in your hands alone.
This brings us to the topic of modifications and improvements. Most landlords will not allow you to re-paint a rental property. This usually happens because they don’t want to trust the job to a non-professional like you, and also because they don’t want to pay a professional unless it is unavoidable.
Many landlords are notoriously slow and unwilling to fix minor things. For instance, if there is a plumbing problem…technically, landlords are legally liable for plumbing repairs. In practice, residents often have to fix these problems themselves because the landlord is too cheap to pay a plumber.
Long-Term Stability
The best thing about owning a home is the knowledge that you don’t have to worry about being booted from your home. There is a certain sense of satisfaction that comes from being the master of your domain, though it is hard to describe.
Let’s say you break one of your landlord’s rules, and they decide to give you the boot. Depending on which state you live in, and the terms of your lease, you might have as little as seven days to vacate the premises. More likely, you will have 30 days to find a new home, but that’s still a gigantic pain.
Of course, it is still possible to lose your property. Although you won’t have to pay rent, you will instead have to pay property taxes. These taxes must be paid twice a year (April and November), or you could lose your home. However, paying twice a year is much better than paying every month. Still, you don’t have to worry about losing your property as long as you don’t get too far behind on those taxes.
Tax Deductions
Since we have already touched on the subject of property taxes (which are admittedly an inconvenience), let’s talk about the positive side of the question. There are quite a few tax deductions from which homeowners can benefit.
Let’s start with the big one: Property taxes are tax-deductible! In case you are the suspicious type, here it is straight from the IRS. As you can see, homeowners can deduct up to $10,000 in property taxes. Unless you own a whole lot of property, this limit should make it easy for you to reduce your overall tax burden by claiming your property tax as a deduction.
Here is some more good news: You can also deduct your monthly interest payments! Although the Tax Cuts And Jobs Act reduced this benefit a little, there is still no reason not to take advantage of a money-saving opportunity. There are also a few requirements to be met, but they aren’t very strict.
The Possibility Of “Flipping”
I am completely sure that your landlord has made you angry on at least one occasion. At times like these, it may be tempting to say something like “stupid landlords, I hate ’em!” You can take this kind of attitude, or you could just take a more positive approach and become a landlord.
Although it may reduce your eligibility for certain tax cuts and government programs (like the FHA home loan program), you can always rent your new home and turn it into a money-maker. If you go this route, be aware that you will have a much bigger set of rules to follow, and the consequences for breaking them can be stiff. Make sure you read the housing laws in your state and remain in compliance at all times.
Savings Over Time
Yes, buying a home is expensive, but is it really more expensive than renting? It depends on how you look at things. Let’s consider a hypothetical situation in which a person (let’s call him “Bob”) is paying $500 a month in rent. This figure is neither particularly cheap nor particularly high. At this price, Bob is paying $6000 per year. Now, let’s assume that Bob lives in this rented home for ten years. That brings the price tag up to $60,000! After fifteen years, the price goes up to $90,000. Clearly, Bob should have bought a home instead!
Conclusion
While there are some definite hurdles to overcome during the process of buying a home, most would agree that the benefits are worth the trouble. With a little research and intelligence, you can save a lot of money. Besides that, you can truly become the master of your domain, and the satisfaction that comes from independence is worth more than money. We hope that you have enjoyed this article and that you will fill out the contact form below so that we can bring you more informative articles like this one.
