Rent vs Buy 3 Financial Advantages of  Home Ownership 1)  Owning is cheaper than renting (over time)   Amount spent on rent...assuming that there is no increase in rent for 30 years: Monthly rent $1500 Year 1 =  $18,000 Year 5 =  $90,000 Year 10 = $180,000 Year 30 = $540,000   Monthly rent $2,000 Year 1 =  $24,000 Year 5 =  $120,000 Year 10 =  $240,000 Year 30 =  $720,000   Monthly rent $2500 Year 1 =  $30,000 Year 5 =  $150,000 year 10 =  $300,000 Year 30 =  $900,000   Monthly rent $3000 Year 1 =  $36,000 Year 5 =  $180,000 Year 10 =  $360,000 year 30 =  $1,080,000    Amount earned through appreciation with ownership: Let's assume you purchased a home worth $400,000 and it appreciated 3% per year, your home would be worth a little less than $1M in 30 years.  The fixed mortgage payment would not increase with inflation as rent does and after 30 years you would no longer have the mortgage payment. 1 Year =  $412,000 5 Years =  $463,709.63 10 Years =  $537,566.55 30 Years =  $970,904.99   2)  Homeowners get tax breaks that renters don't   The government allows for deduction of the interest payments on your home mortgage.  This is particularly beneficial during the initial years of your loan when the bulk of your monthly payment goes to interest.  Money spent on rent is out the window forever. 3)  Homeowners become savers. Home ownership is the key to building wealth and preparing for retirement.   Your monthly mortgage payment is a savings payment.  Each month part of your payment builds equity.  In 2003, the average renter in the U.S. was worth less than $5,000, while the average home owner was worth nearly $172,000.  (source:  Federal Reserve)    Click here for mortgage calculators, general loan info and to contact Bob Dunn and the L&F Bethesda Gateway Prosperity Mortgage Home Loan Team  to explore whether now could be a good time for you to make the move from renting to homeownership.