Paying home loan EMI vs renting a house: Which option will save more money for you? Know here
Owning a home through a home loan offers equity growth, stability, tax benefits, and investment potential. Renting allows for short-term flexibility and initial cost savings
Paying home loan EMI vs renting a house: Still confused about owning your dream house are paying rent? Owning a home through a home loan is a better long-term option than renting due to equity growth, stability, tax benefits, and investment potential. However the rule may not apply to everyone, and depending upon certain personal, and professional factors, individuals may decide to go with either of the options. Some individuals prefer to buy their own space and get rid of the burden of paying rent every month.
Home Loan vs Renting: Which is a better option in the long term?
Amarjeet Rampher Tiwari, Head – Technology, SahiBnk powered by Manipal Technologies Limited said the two options often cause confusion and require speculation over multiple factors associated with them, such as location, housing market, and finances.
In the long term, there are several benefits of homeownership. “Taking a home loan also provides individuals to maximise savings on the back of tax benefits, such as deductions on home loan interest and principal repayments under sections 24(b) and 80C of the IT Act,” said Amarjeet Rampher Tiwari.
While renting may be more appropriate for a person whose professional or personal circumstances require them to move around often, the advantages of homeownership include stable housing costs, a better investment potential, emotional fulfilment, and a solid foundation for financial growth and stability," he said.
While both options have merits, the advantages of buying a house, particularly through a home loan, can significantly outweigh those of renting.
Pramod Kathuria – Founder and CEO, Easiloan listed out the advantages of buying and renting a house.
Home Loan vs Renting: Advantages of Buying a House
Equity Growth: Homeownership builds equity over time.
Stability and Security: Owning a home provides stability, eliminating concerns about rent hikes or abrupt relocations.
Tax Benefits: The government offers tax deductions on both the principal and interest components of home loan repayments.
Appreciation Potential: Historically, real estate tends to appreciate over time, potentially leading to substantial capital gains when you decide to sell.
Home Loan vs Renting: Advantages of Renting a House
Short-Term Flexibility: Renting suits those frequently relocating due to work.
Initial Cost Savings: Renting makes it accessible to those with limited initial funds.
Disclaimer: The views and recommendations made above are those of individual analysts, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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First Published:29 Aug 2023, 01:54 PM IST
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