TAMPA, Fla. — Is it better to rent or own a home? Many of us have been taught that renting is just throwing away money and owning is an investment.
8 out of 10 Americans think that buying a home is the best investment you can make, but Certified Financial Planner James Di Virgilio says it's far from it.
"In fact, it is one of the worst. It is not even an investment if we were to consider it an investment," he said.
Di Virgilio uses this example:
A home buyer puts 30 thousand dollars down.
The renter puts 30 thousand into an investment.
Which one is better at the end of 15-30 years?
"At the end of the day, renting plus investing this down payment versus putting it down on a house will actually save you money."
Di Virgilio says on average, you lose 11.8% a year by owning a home. Why?
-mortgage debt
-maintenance
-property taxes
-improvements
So Di Virgilio says it's good news for renters.
"You are not lighting money on fire if you're renting especially if you're investing the extra money you're saving," he said.
The bad news, most of us are spending too much money on our home whether we rent or own.
"Homes are great, but they are not investments," he adds. "What this means is, the smaller home that we buy, the more money we'll have if we're being smart with our money and investing in something better. So it really depends on how you want to balance your wealth."
He says if you do buy a home, it should only be two and a half times your gross income.
A good Certified Financial Planner should be able to help you decide what's best for you and your family, and your financial future.
What other people are reading right now:
- Gulf of Mexico disturbance has 80-percent chance of developing, likely to move west
- He called police on black women at swimming pool. Now he’s facing criminal charges
- 16-foot Burmese python found nesting under home in the Florida Everglades
- Man says he was kicked off Busch Gardens ride because he looked too old
- Flesh-eating bacteria suspected in Florida woman
►Make it easy to keep up-to-date with more stories like this. Download the 10News app now.
Have a news tip? Email desk@wtsp.com, or visit our Facebook page or Twitter feed.