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One of the most important life decisions you’ll ever be faced with is whether you should become a homeowner or continue renting. Before you can determine what the right financial move for your particular situation is, there are several variables to consider — such as upfront costs, insurance obligations, maintenance requirements, and value appreciation. To make an informed choice, you must have a clear understanding of what sets owning apart from renting. Here are some of the key differences between the two options.

How Does Being a Homeowner Differ From Being a Renter?

1. Flexibility

As a homeowner, you have the flexibility to remodel, paint, and decorate however you wish. You are completely free to make your living space look exactly like you want it to. When you rent, you’re generally restricted in the modifications you can make. You may be able to make small improvements if you get the landlord’s permission first. Additionally, upgrades that are done while you own can help yield a better return on your investment, whereas updates done to a rental will only benefit the property owner.

2. Maintenance

insuranceA major perk to renting is that you don’t have to worry about maintaining the building or grounds you live on or making repairs when something breaks. Your landlord or property management company will handle all of the upkeep, and if you need a repair, they will have someone to take care of it for you. However, when you own your home, you are responsible for all maintenance, repairs, and yard work that needs to be done.

3. Insurance

If your home is financed with a mortgage loan, the lender will require you to purchase homeowners’ insurance. At a minimum, you must cover the cost of the dwelling, but a standard homeowners’ policy will also include liability and personal property coverage. Renters’ insurance is available as well but rarely required. It’s structured to only cover your liability risks and personal belongings. Your landlord should have insurance to cover the building itself.

4. Taxes

Unlike renters, homeowners must pay property taxes. Although, the amount you pay in property taxes and mortgage interest are both tax deductible. This can provide substantial savings on your tax obligations. Those who rent aren’t given a tax break other than possibly a small renters’ credit.

 

Regardless if you decide to own or rent, your financial future will be vulnerable to a number of risks that only a quality insurance plan can safeguard you against. As many other Mebane, NC, residents have, you can rely on Craig Giovani State Farm® Insurance Agent to help you find a homeowners’ or renters’ insurance policy that adequately covers your needs. His team of agents has earned a reputation for providing clients with unparalleled customer service and invaluable guidance while shopping for coverage. To request a quote, call (919) 300-5911, or visit his website to learn more about the variety of products he offers.

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