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by Christy Bieber | Published on Sept. 12, 2022
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Is owning a home right for you?
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Deciding whether to buy a home is a huge decision. If you move forward with your purchase, you’ll likely be committing to take on a huge debt in the form of a mortgage loan that you will be paying back for years. You’ll also need to be more committed to staying in one location because it’s harder to sell a home than it is to break a lease on a rental home.
But, while there are disadvantages to homeownership, including reduced flexibility, there are also many huge benefits as well. In fact, finance expert Dave Ramsey has identified some of the top advantages of owning your own place. Here’s what they are.
One big benefit of owning a home, according to Ramsey, is that you will eventually own it free and clear and no longer have to pay a mortgage. That’s not the case if you rent, as renters always have to write a monthly check to their landlords.
As Ramsey says, “Once your house is paid off, it’s yours! You have the satisfaction of knowing you made the American Dream your reality.”
Ramsey also explained that owning a home can help you to build wealth because you will benefit from property appreciation. If property values rise, the home that you purchased should sell for more than you paid for it. That profit increases your net worth, which is one reason why homeowners tend to be wealthier than renters.
“What you buy for $200,000 today could sell for $260,000 down the road,” Ramsey said.
Some homeowners also enjoy another benefit identified by Ramsey as well: the ability to claim special tax breaks. “Many costs of owning a home — like property taxes and mortgage interest — are tax deductible,” Ramsey explained.
However, note that you can generally deduct taxes or mortgage interest only if you itemize on your taxes, which means that you do not claim the standard deduction but instead deduct specific expenses you pay. Many people are better off claiming the standard deduction because it provides more tax savings than itemizing does — and if you’re one of them, this benefit will not apply to you.
If you like to personalize your space, then you may appreciate the next huge advantage of homeownership that Ramsey outlined: The ability to make the space your own.
“As a homeowner, you can do whatever you’d like to your home,” the Ramsey Solutions blog reads. “If you want to paint it hot pink from top to bottom, no landlord can stop you — although your spouse might have something to say about it.”
Of course, renovating costs extra money, so this can be a downside as well as an advantage. While some renovation projects are fun, others — such as adding a new roof to stop leaks — may be just a hassle and an expense and something that you probably wish a landlord would take care of.
Finally, Ramsey indicates that homeowners often live in structures that provide more privacy — although of course this depends on what types of rentals or private homes are available or affordable within your area.
Ultimately, you will have to decide whether these advantages that Dave Ramsey identified are enough to convince you to purchase a home. Remember that it’s a big decision and keeping the downsides in mind is also important too, so you don’t get swayed by a rosy picture of what property ownership is like.
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Christy Bieber is a personal finance and legal writer with more than a decade of experience. Her work has been featured on major outlets including MSN Money, CNBC, and USA Today.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.
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