Why Buying Makes More Sense than Renting
January 11th, 2012 at 2:08 pm | Type:
Author: DWC Admin | No Comments
A recent study conducted by business experts Eli Beracha and Ken Johnson deals with whether or not buying a home makes more financial sense than does renting one. In their work entitled Lessons from Over 30 Years of Buy versus Rent Decisions: Is the American Dream Always Wise?, the scholars come to some surprising conclusions that reassert and solidify the value of homeownership over renting.
Although Beracha and Johnson are concerned with critically analyzing the value of owning your own home, they forthrightly confess that “home ownership…is credited with enhancing wealth, increasing civic pride, improving self-esteem, crime prevention, child development, and better educational outcomes.” The authors found that renting was more financially advisable than buying only when renters “without fail reinvest any residual savings from renting.” However, this is certainly not always the case with a number of renters.
Because of this, Beracha and Johnson go on to state that “fundamental drivers now appear to be in place that favor homeownership over renting in the near term future.” The authors state that despite the apparent difficulties in some real estate markets around the country, “rent-to-price ratios now seem to be in place…that favor ownership over renting.”
Danielle Windus-Cook Properties firmly agrees with these findings and with the continuing value of homeownership in the United States today.
Filed under : DWC Connect
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