Everyone generally knows one of the great benefits of homeownership is the mortgage interest write off come tax time every April. The question is how does that benefit translate in real dollars? Tough question. The answer is, “It depends.” Whether you saved a couple hundred or a couple thousand dollars with the write off this past year there are many more factors involved for the home-renter considering becoming a home owner if you want a true picture of the bottom line benefit of homeownership. Some of those factors already have dollar signs attached to them: current monthly rental payment, purchase price of home, mortgage interest rate, length of loan, etc. There is a buying versus renting tool available here at the Ginnie Mae website to help you factor in all those numbers for a better picture of your specific situation.
Here’s a great article discussing those hard number factors as well as some of the more subjective dynamics like pride of ownership, dealing with landlords, long term plans, and the volatility of the real estate and mortgagemarkets.