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Buying a Home NOW is a Very Wise Move

FIU College of Business did a 30 year study which casts doubt on whether buying is really better than renting.  Although the results are not available yet, you can read a summary here.  After reading the summary, I’d like to make two points:

Their conclusion that renting makes more sense is based on the premise that the renter would be investing the difference between renting and owning.  By their own admission, renters DON’T do this nor do historical trends support that they are likely to have the discipline to do so.  Life gets in the way and the money is spent elsewhere.  Additionally, in Miami, there are places where renting costs more than buying, so there would be no savings to invest.  So each month you’d be a little poorer and you’d have no tax advantages at the end of the year either.

In spite of their findings, they admit that buying NOW is an exception to their results, because home prices are so affordable.  Here’s what they said about buying today:  “Current home market prices make today’s market the most compelling for home ownership in the buy versus rent equation.”  And in the local Miami market, the difference is even more marked.

I still contend that buying a home is a smart move and am instilling that in my own children.  I am helping my young daughter line up her finances just so so she can buy in the next couple of years.  And when she’s ready she knows the Realtor she’s going to use. =)

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These articles are not intended to give legal or tax advice, and you should consult your attorney or financial advisor for additional information.

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