Transitioning from Renter to Homeowner

We make a lot of assumptions about why people don’t rush to buy a home; credit issues, financial issues or perhaps uninformed of the process into homeownership; but it becomes more than just the benefits of becoming a homeowner.

Many people have been raised in a renter’s culture and have never thought of owning a home. Homeownership is a big step for a lot of people; families must learn how to live in a diverse neighborhood, and deal with taxes, insurance and other aspects of home ownership that was never contemplated before. The mere responsibilities of homeownership make many renters shutter at the thought.

“You mean I’m responsible for my own maintenance?”
“I have several monthly bills other than just rent?”

Sure, there are many advantages to owning a home but there are also sacrifices. In the end it really will balance out because you’ll get a nice tax break. Owning a home means you get new tax breaks that weren’t available to you before. For many new homeowners’ it’s the first time they’ve ever received a tax refund worth a few thousand dollars, all because they own a new home.

So here are some things to consider; there are many advantages to buying a home versus renting year after year.

Have you ever considered that you’re just paying someone else’s mortgage payment and providing your landlord with tax benefits that you could be receiving? Your landlord owns the building you live in and is most likely paying a mortgage payment to the bank.

So the landlord collects rent from each tenant and then makes a payment to his/her bank. Let’s say the landlord’s mortgage payment to the bank is $4,000 a month. That is a large payment and it could be more or less than that; however let’s say you live in a building with 10+ tenants times everyone paying $1,000 in rent. The landlord is still making a profit each month…AND, the landlord is able to deduct expenses and interest off of his/her taxes.

So you see the big picture here; you’re helping your landlord make a BIG profit each month.

Did you know that for the same amount you’re paying in rent you could afford to buy a home? It’s probably cheaper to buy a new home versus what you’re currently paying in rent.

While maintaining a home does indeed have a cost factor associated with it, it should not be an obstacle to becoming a home owner. You can always purchase a “maintenance insurance policy”. This type of insurance policy covers small repair problems for plumbing, heating, electrical and more.

Understanding the benefits, obstacles and issues each of us faces as first time home buyers will help us eliminate those obstacles and overcome the fear in transitioning from renter to homeowner.