Most people want to become homeowners at some point in their lives, but many believe that owning a home is too expensive for them. Regardless of this perception, buying a house still remains one of the most important elements of achieving financial stability, even for people with relatively low incomes.

Here are five financial reasons you should buy a home as soon as possible.

1. Smarter Than Paying Rent

Many people tend to think that renting is cheaper than buying but in the long term in many cases, it is much more expensive. You’re paying for housing whether you own or rent.

While some may argue that mortgage payments come with interests, it should be noted that in most instances those interest payments are tax-deductible. In the contest of long-term renting versus buying, buying wins every time – it just makes financial sense to buy a home than rent.

2. Buying Allows You to Build Equity

Even if buying was not significantly cheaper than renting, it would still have some very definite advantages. When you rent, part of your payment usually goes into paying for the property you are living in. In other words, you’re paying to buy someone else a high-priced asset! Instead of using your rent to buy your landlord a multi-million naira gift, you should be investing your money in buying the same asset for yourself. When you buy, most of the money you spend on mortgage payments end up back in your pocket in the form of home equity.

3. Hedge Against Inflation

Real estate moves in cycles, sometimes up, sometimes down, yet over the years, real estate has consistently appreciated. Housing costs and rents have tended over most time periods to go up at or higher than the rate of inflation. This makes owning a home an attractive proposition as it is a hedge against inflation.

4. A form of “forced savings”

Owning a home can be a form of forced savings. Since many people have trouble saving and have to make a housing payment one way or the other, owning a home can help you overcome the tendency to defer savings to another day.

5. Owning a Home Can Set You Up for Future Financial Success

One of the good reasons that homeownership is considered a key element of financial success is that it frees you from the monthly housing costs that otherwise eat up a large part of your income. Also, purchasing one home can be your introduction to the world of real estate investment. Just like stocks or bonds, real estate can be a profitable investment vehicle. If you already own one home, you can purchase another as a means of generating rental income.

Bottom line

These are just five of the many reasons that it pays to own a home. Whether you are a recent graduate just starting out in life or someone who has been paying rent for decades, it’s never too late to change directions and bolster your financial situation by becoming a homeowner. Remember, if you’re paying rent, you’re paying for your landlord to own a home when you could be paying for your own more cheaply.