Renting vs. Buying Malibu Real Estate
In a down economy, it’s tempting to find another rental instead of thinking about buying one of the many beautiful homes for sale. While Malibu rentals have some benefits, buying a home can actually help you save money when you compare it with the cost of renting. Learn about the benefits of buying Malibu Point Dume homes and determine if buying could be the right option for you.
When you pay rent to someone else every month, all you are doing is helping that person build his or her future. The rent money does not help you improve your financial situation or invest in yourself. All it does is guarantee that you can stay in your apartment or condo for another month. When you buy a home, you are investing in your future. Every time you pay your mortgage, you will be building equity. Once you pay off your home, you will have a valuable asset that can serve as collateral for a home equity line of credit. If you are thinking about the future, buying is clearly a better option than renting.
Buying Malibu real estate has several financial benefits that renting just does not provide. Rental leases are typically only a year long, which means that your landlord can make regular rent increases. Any time your lease is up for renewal, your landlord can impose additional restrictions on how you use the unit. Although it is possible that another company will buy your mortgage from the original lender, those who buy their homes typically pay the same amount of money each month until the mortgage is paid off. Knowing how much you have to pay for your home each month can help you better plan your finances.
Renters do not receive the many tax benefits available to people who own their own homes, so renting can actually be more expensive than buying. The federal government offers credits for first-time homebuyers and the purchase of energy-efficient appliances. Depending on your circumstances, you may also qualify for additional tax credits. In many cases, you can also deduct mortgage or property tax payments on your tax returns. This makes owning a home a very attractive option.
Due to the decline in the economy, interest rates are now very low. If you have a good credit history and make enough money to qualify for a mortgage, you may be able to lock in a home loan with a very low interest rate. Locking in this reduced rate can help you save hundreds or even thousands of dollars over the life of your loan.
When you rent someone else’s property, the property owner can restrict what you do to the rental. You may not be allowed to hang pictures on the walls or paint with the colors you really like. If you hate the carpet, you might not be allowed to replace it. When you buy your own home, you can customize it to your liking and make changes as desired.
Russell Grether of Coldwell Banker Previews International is a real estate agent based out of Malibu, CA. He specializes in Malibu real estate, Malibu homes for sale, Malibu properties, Malibu Land for sale, Malibu rentals and surrounding area real estate from Montecito to the Pacific Palisades.