"An economist is an expert who will know tomorrow why the things he predicted yesterday didn't happen today."
Laurence J. Peter
Rent
or Buy? Excerpted
from the book, It’s More
Than Money—It’s Your Life by Candace
Bahr, CEA, CDFA and Ginita
Wall, CPA, CFP®, CDFA.
A tremendous sense of pride comes
with owning your own place, and owning
a home has financial advantages as
well. You can deduct the mortgage interest
and property taxes on your income tax
return, your house may appreciate in
value, and when you sell your home
you’ll likely realize that gain
tax-free. Those are pretty great perks
for investing in property.
But buying a house at the wrong time
or spending more than you can afford
are mistakes that can seriously derail
your financial plan. Fail to pay your
mortgage and you could lose the roof
over your head. During a housing slump,
renting is often your best bet, since
property owners who are waiting for
prices to rise will rent out their
property, flooding the market with
rentals and causing rents to drop.
Your decision to rent or own should
be based on your own personal situation
and finances. Here is a worksheet to
help you get a better sense of the
financial and tax consequences of owning
versus renting.
