Buying house is better than renting an apartment Term Paper

Buying house is better than renting an apartment - Term Paper Example Moreover, the residents do not have to worry about moving from one rented apartment to another, if the landlord decides to sell it or rent it out to someone else. Buying a house is also a favourable option due to the current economic situation. The dip in the property price has enabled many people to invest in a house, which is a far better option than renting an apartment. Keywords: buying, house, renting, apartment, property, investment, mortgage. Buying a House is the Winning Choice Did you know that you can purchase a house for $100k and have a mortgage of $900.00 dollars, which is less than average rent? According to World Time News Report, the national average two-bedroom fair market rent is â€Å"$928 a month† (2009). During the same year, the median sales price for those homes was $223,800; while the average sales price was $257,500, which is roughly about $800 per month. (Wyndham Capital Mortgage, Inc., 2009) This comparison of the average monthly rent and the average monthly instalment, in case of buying a house explains why buying a house is the winning choice. Buying a house is a long term investment; it gives financial security and a sense of ownership. Home ownership is not an easy task though; yet it is extremely beneficial in the long run in a number of ways. The current situation in real estate market gives one an optimum chance to invest in a house as, â€Å"home prices have fallen approximately 10% year-over-year in most markets...† (Lynn, 2009, p.5) Home ownership provides an investing advantage. Every payment one makes towards the mortgage, guarantees ownership. Any major updates or changes that one desires to make to the property will increase the value of the house. Under normal circumstances, home resale values tend to increase over the years. According to statistics provided by U.S Department of Housing and Urban Development, homes that were sold for $90k in 1990 are now worth about $150k; despite the fact that in 2005, th ose homes where at about $250k. (2011) It is a relatively easier way to buy a house by paying only 5% or as less as 3% down-payment of the total price. If a person has an FHA loan, which are secured and protected by the government, then buying a house becomes an easy process. This way, a person can get a slow-start and gain ownership. On the contrary, renting an apartment requires at least $3000 upfront- which is a lot of money! In other words, a house that is worth $100k can be purchased with $5000 down-payment and a monthly mortgage of about $950. However, the same house shall be rented for approximately $1200, exclusive of the initial deposit. Thus, buying a house is a viable option, particularly in the current economic situation and the state of the real estate market. Buying a house is considered as an opportunity to make profit out of the oscillating prices of the real estate market. A person can even get a chance to sell out the house if a potential buyer offers a higher pric e than the actual price at which it was bought. Thus, it proves to be a sound financial investment as contrasted with renting an apartment. Buying a house also gives a sense of financial security as one is aware of the fact that he/she shall have to pay the same amount of monthly mortgage for the nest thirty years. This is of high significance, as it allows the home owner to plan his savings and expenses, accordingly. On the