There are many aspects of your life that determine whether you should buy a home - family size, job stability, location, income, lifestyle, etc. Even the best planners can't predict what the future holds, but you can be prepared for the different circumstances.

Economic Differences between Buying and Renting
Don't buy a home just for investment gain. There are many other investments that will give you a greater return in a much shorter time. Buying a home can and should be a long-term commitment. However, every month your payment goes toward increasing your investment gain. It may be small at first, but as the years go by you will have a solid investment. On the other hand, rent is a monthly expense that keeps a roof over your head, but the money paid is gone with no savings to show for it.

Pros of Homeownership
When buying a home, there is a probable chance that homebuyers will be able to deduct part of their mortgage interest and real estate taxes each year, especially during the first few years.

Another benefit is building equity over time as home values rise in the area and the homeowners pays off their mortgage. Many can also expect a steady mortgage payment for a certain amount of years depending on what mortgage plan they pick. And a homeowner feels a sense of freedom from landlords, policies, and rental agreements.

Cons of Homeownership
You are responsible for all home-related costs - utilities, upkeep, renovations, HOA, etc. When something breaks - you fix or replace it. There is no landlord to call. Be sure to prepare for the unexpected leaky roof, flooding dishwasher or broken air conditioner.

If you need to relocate within a few years or if you need to sell during a time when housing values are declining, you could lose money on your investment. And remember, if there is an unexpected job loss or change in your economic situation, you are still responsible for your home loan payments and ensuring you pay them on time.

Buying a home is the American Dream, but make sure you are prepared for the ups and downs so it does not become a nightmare.