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Rent or Own In Today’s
Economy? |
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With the real estate market changing dramatically in the past
few years and some regional markets more than doubling in property
value, is it a good time to buy property? Consider the factors:
real estate has increased in value while interest rates have
dropped to record lows. |
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| But real estate is like any other investment. If you look
at the long-term picture, you can still expect to earn a substantial
profit. Historically, real estate has been a strong, relatively
safe long-term investment. Are you planning to relocate soon,
or can you commit to living in the property for the next decade?
Owning is ideal for those individuals or families who plan to
stay in the same location for at least ten years. After all,
you’re paying a large sum upfront, which includes your
down payment, points, appraisal and application fees. These
fees are typically recovered three or more years after purchase. |
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| Your next consideration is asset appreciation. While payments
are steep at the outset, topped with homeowners’ insurance,
maintenance, repairs and any renovations you’re planning
to make, you should still earn an average annual return of three
percent. In ten years, your home could be worth 30 percent more
than you paid today. While rental rates increase each year,
your home will remain the same. |
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| Next, understand the tax ramifications of ownership. These
vary based on your unique situation. Yet most homeowners gain
substantial savings as a result of mortgage interest and property
tax write-offs. These savings move their payment closer to the
rental rates. |
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| Finally, research your area. Are you in an over-inflated region?
Do real estate professionals feel prices are set to drop in
the next few months? Get a few opinions and balance your options. |
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| Net-net, how long will you live in the house? Property investing
is not for the day trader. It’s a long-term investment
that can still pay off quite well. |
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| For more great articles on this subject, come back
to Vasrue.com. Articles are published weekly on Travel, Real-Estate,
E-business, Credit and a host of other great topics. |
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