According to Columbus Realtors, in 2015, more than 29,000 homes were sold in Columbus, OH and in 2014, 39.28% of residents in Columbus were renters. With buying being just over half of the residents and Columbus and renters being just under half of the residents, it can make your decision to buy or rent that much harder. Below we break down the advantages and disadvantages of buying and renting in Central Ohio to help you make the best choice that will benefit you.
what to consider when Buying Real Estate in Central Ohio
In a majority of cases, purchasing a homes costs as much, sometimes less, than renting. Buying a home has several other benefits including:
- Tax deductions
- Building equity
- First time home-buyer programs
- The ability to make it your own
Money Girl, also known as Laura Adams, gives great advice regarding the tax deductions you can benefit from when purchasing a home such as your mortgage interest and property taxes that can be deducted from your taxable income every year. Use this mortgage tax deduction calculator from Bankrate to determine what you can save.
Owning a home is also a great way to build equity. As your property value increases and your debt decreases, the amount of equity you own increases. By determining the value of your home and subtracting it from the amount you still owe on your home, you can figure out how much equity you have in it.
First time home-buyer programs aren’t for everyone, but can be a big perk if you qualify. The Federal Housing Administration (FHA) helps make home-buying an affordable process. With an FHA loan you don’t need to have the highest credit or a high down payment available to qualify. An FHA loan sometimes even covers closing costs. Learn more about qualifying for an FHA loan.
Finally, purchasing real estate allows you to add your personal touch to your living space. You can replace appliances, flooring, fixtures, and other features to design a personalized space. Making a place your own is one of the biggest perks of owning a home.
What to consider when RENTING REAL ESTATE in Central Ohio
If owning a home doesn’t seem right for you just yet, renting is a good alternative if any of the following reasons apply to you:
- You do not expect to own a home for more than five years
- You are uncertain about job stability
- You have declining credit
- You want more flexibility
- You’re looking for something low cost
Unless the real estate economy is on a rapid incline, it normally will take at least five years to realize equity. If you are uncertain about how many years you plan to stay in a property, renting could be the safer option. Renting doesn’t tie you down to a specific city or state for the future so if you don’t see yourself living where you are for the next five years, renting will be a benefit to you.
Employment stability is another factor to keep in mind when deciding to rent or buy. Renting enables you to react to employment loss by moving to a different rental and keeping your monthly expenses low. If there have been news of upcoming layoffs or you are looking for a new job that may not provide the income you have now, renting is a great, stable option.
If you have poor credit, that may lead to higher interest rates, making home ownership a more expensive option. As you continue to make your rent payments (ideally on-time) you will continue to build up your credit, making you eligible for a better and lower interest rate when it is time for you to purchase a home.
Renting also provides much more flexibility than owning a home. To get out of a lease early you typically only need to provide a 30-day notice. Unfortunately, it’s not that easy if you need to get out of a mortgage. Also, with no property to upkeep, renting allows you to spend your money elsewhere, rather than on a new lawnmower or flowers for the flowerbed.
Finally, renting is the best choice for someone looking to save money. When purchasing a home you will need a significant down payment. Renting is a great option if you are still working on saving up for a down payment.