It’s an age-old question that is once again at the forefront of many people’s minds: Is it better to rent or purchase a home?

People who are considering a change in their current living situation may wrestle with the decision of what’s best for them.

While one person’s situation is certainly different from another’s, generally speaking, it’s almost always better to purchase a home than it is to rent a place to live. From affordability to flexibility, pride in ownership and building assets, homeownership provides many advantages over renting no matter what your situation.

This isn’t to say that renting doesn’t have its benefits.

Indeed, there are many positives to renting such as:

  • (in some situations) not having to do yard maintenance
  • not being financially responsible for major home repairs
  • not being locked into a long-term financial contract

However, if homeownership is something that is in the cards for you, it’s almost always the better option.

What If I Can’t Afford to Buy a Home?

This is a question that many people who rent ask themselves.

They may think homeownership is too expensive for them, or that they can’t qualify for a home loan (a little more on that part in a bit). But when you break down all the details of homeownership and compare it to renting, you’ll often find that purchasing a home and funding it through a mortgage is actually cheaper than renting.

There are quite a few factors that go into this affordability calculation as well. First, we need to consider monthly payments for each. Depending on where you buy, your interest rate, and other terms of your mortgage, your monthly mortgage payment could easily be less than the average rent payment in that area.

True, there are more price factors that go into housing — such as payments for electricity and possibly gas and water, which are either non-existent in some rental housing or are at least cheaper than they are when you own a home. Whether your mortgage will be cheaper than your rent for comparable properties also will depend on what area of the country you live in, and that region’s specific market for each.

When you take it a step further, though, you’ll see even more reasons why purchasing a home is often cheaper than renting. One of the biggest advantages of owning a home are the tax advantages that come along with it. Even after the large tax law changes that went into effect in 2018, $10,000 in property taxes and interest on up to $750,000 of mortgage debt can be itemized for tax deductions. This could make a huge financial difference to you at the end of the year, depending on your particular financial situation. Be sure to speak with your tax advisor before buying a house, though, because certain rules may not apply to you.

What Are Other Benefits of Buying a Home?

Some of the other benefits of buying a home versus renting a home aren’t as statistically driven.

It’s true that making continuous on-time payments on your mortgage over time will increase your credit score and help you build value in what is most people’s largest asset in life — their home. These are two things that you will never get by renting, even if you never pay one day late.

The other benefits of purchasing a home are more independence-based. First, when you own a home, you have the right to do whatever you want with it. This can be as complex as adding an addition to your home or completely upgrading the kitchen, or it can be as simple as painting the walls. Some rental housing won’t even let you customize the space in that way so that you can make it feel like it’s your own.

While this personalization may seem petty and insignificant, it is these home improvement projects that build value in your home. More often than not, you would upgrade your kitchen, for example, so that you can enjoy your space more. At the same time, though, you’re making an investment into your home, as it will be worth more with a newer kitchen than an older one.

What If I Can’t Qualify for a Mortgage?

This is another question that may scare people away from buying a home. It’s true that not everyone will be able to qualify for a mortgage, either because their credit scores are too low, they have too much debt, or they don’t have enough income. However, there are many mortgage programs available that provide options for more buyers than ever before.

The most desirable type of mortgage for homebuyers is a conventional loan, because it kick-starts you with the most possible equity in your home and allows you to potentially avoid monthly Private Mortgage Insurance payments.

To qualify for a conventional home loan, though, you must have a higher credit score and a lower debt-to-income ratio than other loan programs.

But that is far from the only mortgage program available, and it isn’t the only attractive option, either. Other loan programs such as FHA insured loans will require a credit score that isn’t as high as conventional loans, plus, you’ll have a lower down payment requirement. USDA loans are tailored to lower-income buyers in rural areas, and don’t even require you to put a down payment at all.

VA home loans and 203K home loans are also non-conventional loan options that might work for you and your situation. You may think you can’t qualify for a mortgage, or you may not qualify for a conventional loan, but after talking to a mortgage lending professional, you might realize there’s an option that would be a fit for you.

Work with a Mortgage Professional

If you are unsure of whether you might qualify for a mortgage, or whether purchasing a home would be more advantageous than renting for you, talk with a mortgage professional.

The experts at Embrace Home Loans will be able to clearly outline all the details of homeownership and all the different loan programs you might qualify for so you can experience the vast joys and benefits of owning your own home.