Buying and Renting Homes in Maryland
Rent Verses Buying
Pride in Owning
Most people buy homes to have control over where they live. Although investment features are important, the psychological reasons for buying - the satisfaction of owning and freedom from paying rent - are at least as important.
In a survey done by the National Association of Realtors of 6,000 homeowners and 2,000 renters - perhaps the largest ever of attitudes toward home ownership - showed that 76% of owners and 66% of renters considered pride of ownership an important reason for buying.
Dislike Paying Rent
Almost equal portions of owners and renters - close to 7 in 10 said a dislike of paying rent was an important reason to buy. Renting offers a lifestyle that's nearly maintenance-free. That may appeal to you, but consider that renting offers you no equity, no tax benefit, and no protections against regular rent increases. Writing a rent check is just like watching your hard-earned money sail away!
Settling Down
More than 6 in 10 renters said "settling down" was an important reason to buy.
Good Investment
76% of owners and 69% of renters said the investment aspect of ownership was important.
Tax Advantages
Property taxes and qualified home interest are deductible on schedule A, for itemized deductions.
Long-Term Appreciation
People consider home ownership a good investment because they view it as a long-term venture. Historically, home prices have risen at relatively steady rates. Existing home prices rose an average of 4% per year between 1980 & 1992.
Leverage Investment
People borrow a great deal to buy a home, yet they receive the full benefits of price appreciation. In the long run, investments in homes far outpace inflation,
Source of Savings
Home ownership always has and continues to comprise the single largest source of savings for American households. Homeowners build equity and can borrow against it.
Sacrifices are Worth It
Almost 7 in 10 renters in the NAR home ownership survey said they planned to buy a home in the future. More than three-quarters of these people said they were willing to sacrifice to do that.
| $900 per mo. for rent today | $1,100 per mo. for rent today | $1,300 per mo. for rent today | $1,500 per mo. for rent today | $1,800 per mo. for rent today | $2,000 per mo. for rent today | $2,300 per mo. for rent today | |
| You'll pay | You'll pay | You'll pay | You'll pay | You'll pay | You'll pay | You'll pay | |
| This Year | $10,800 | $13,200 | $15,600 | $18,000 | $21,600 | $24,000 | $30,000 |
| Next Year | $11,124 | $13,596 | $16,068 | $18,540 | $22,248 | $24,720 | $30,900 |
| 3rd Year | $11,457 | $14,003 | $16,550 | $19,096 | $22,915 | $25,461 | $31,827 |
| 4th Year | $11,801 | $14,423 | $17,046 | $19,669 | $23,602 | $26,225 | $32,781 |
| 5th Year | $12,155 | $14,856 | $17,557 | $20,259 | $24,310 | $27,012 | $33,765 |
| 6th Year | $12,519 | $15,302 | $18,084 | $20,866 | $25,040 | $27,822 | $34,778 |
| 7th Year | $12,895 | $15,761 | $18,627 | $21,492 | $25,791 | $28,657 | $35,821 |
| 8th Year | $13,282 | $16,234 | $19,186 | $22,137 | $26,565 | $29,516 | $36,896 |
| 9th Year | $13,608 | $16,721 | $19,761 | $22,801 | $27,362 | $30,402 | $38,003 |
| 10th Year | $14,090 | $17,223 | $20,354 | $23,485 | $28,183 | $31,314 | $39,143 |
| Total | $123,803 | $151,319 | $178,833 | $206,345 | $247,616 | $275,129 | $343,914 |
