There are some people that have not yet purchased a Central Ohio home because they are uncomfortable taking on the obligation of a mortgage. Everyone should realize that, unless you are living with your parents rent-free, you are paying a mortgage – either your mortgage or your landlord’s mortgage.
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HOW CAN YOU BE PAYING A MORTGAGE IF YOU’RE RENTING?
As the Joint Center for Housing Studies at Harvard University explains:
“Households must consume housing whether they own or rent. Not even accounting for more favorable tax treatment of owning, homeowners pay debt service to pay down their own principal while households that rent pay down the principal of a landlord plus a rate of return.
That’s yet another reason owning often does make more financial sense than renting.
BENEFITS OF HOMEOWNERSHIP IN CENTRAL OH
Christina Boyle, a Senior Vice President, Head of Single-Family Sales & Relationship Management at Freddie Mac, explains another benefit of securing a mortgage vs. paying rent:
“With a 30-year fixed rate mortgage, you’ll have the certainty & stability of knowing what your mortgage payment will be for the next 30 years – unlike rents which will continue to rise over the next three decades.“
As a Central Ohio home owner, your mortgage payment is a form of “forced savings” which allows you to have equity in your home that you can tap into later in life. As a renter, your landlord is the person building equity in the home.
The graph below shows the widening gap in net worth between a Central Ohio homeowner and a renter:
Whether you are looking for a primary residence for the first time, or are considering a vacation home on a lake, owning might make more sense than renting, since Central Ohio home values and interest rates are projected to rise.