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Is it better to buy or rent a home in Boise, Idaho, financially speaking?
This is a common question among people relocating into the Boise area, as well as those who are currently renting but considering a purchase.
Buying a home in Boise, ID requires a thorough financial self-assessment along with some soul searching. You have to make sure it’s the right move for you, based on your current situation and long-term plans.
But overall, owning a home in Boise, Idaho could deliver a number of financial benefits while helping you build your personal wealth. In this article, we’ll go into more detail about the differences of owning vs renting in Boise, ID.
Want to buy a home in the Boise area? It’s generally a smart move.
(It’s also one of the most beautiful parts of America and a haven for outdoor recreation enthusiasts, but let’s stick to the money-related factors for now.)
Here are several financial benefits of homeownership in the Boise area:
Boise has consistently ranked as one of the most desirable places to live in the U.S. It has also experienced steady population growth, due to job opportunities, outdoor recreation, and a high quality of life.
Strong demand from buyers (including new residents) helps to sustain property values in the Boise area. This makes it a great real estate market for homeowners looking for equity building in Boise.
The Boise real estate market has a long history of stable prices and strong resale value.
For example, according to Zillow, the median home value in Boise, Idaho rose from $307,000 to $478,000 over the past five years.
Other cities located within the Boise metro area (such as Eagle, Meridian, and Nampa) experienced similar price growth during that timeframe.
Owning a home lets you capitalize on this trend, while renting does not.
Boise homeowners also get to enjoy certain tax advantages.
Homeownership typically comes with property taxes, which are used to fund a wide variety of infrastructure projects. But the state of Idaho has relatively low property taxes compared to the national average, boosting the overall affordability of homeownership in Boise.
According to the accounting firm XOA Tax:
“Idaho property taxes are very inexpensive compared to the rest of the country. The average homeowner in the Gem State spends $1,817 in property taxes each year, over $1,000 less than the national average.”
Homeowners in Boise can also deduct mortgage interest and property taxes on their federal tax returns, which isn’t an option for renters. But you might want to check with a tax professional to see if this applies to your situation.
Boise has seen sharp increases in rental prices over the past decade, due to limited rental inventory and growing demand. Renters often face unpredictable rent hikes. This is one of the key differences between renting vs buying in Boise.
Homeowners, on the other hand, have the opportunity to “lock in” their monthly housing costs by using a fixed-rate mortgage loan. This allows for predictable monthly payments over time.
Homeowners are able to make modifications to their homes, customizing them as needed to suit their lifestyles. For instance, a lot of homeowners in the Boise area create outdoor spaces to enjoy the four distinct seasons and 200+ days of sunshine per year.
These types of enhancements can also increase a home’s value. So you’re improving your quality of life while boosting resale value all at once.
Renters, on the other hand, typically lack the freedom to customize their living spaces.
Home buyers in Boise can take advantage of assistance programs specific to Idaho. For example, the Idaho Housing and Finance Association offers a program that helps home buyers cover their down payment and closing costs, simplifying the path to homeownership.
By making monthly mortgage payments and reducing their loan principal, Boise homeowners can build their equity and create wealth over time. Home appreciation in Boise, ID accelerates this process.
Renting, on the other hand, does not build equity or personal wealth.
Home equity can also be used to finance other investments, college tuition, or home improvements. This gives homeowners a financial cushion that renters don’t have.
Owning a home outright (after paying off a mortgage) increases financial freedom and reduces housing costs during retirement. This is especially valuable in the Boise area, which is a popular retirement destination.
If you purchase a multi-unit property or a property in a desirable neighborhood, you may have the opportunity to generate rental income to offset your mortgage payments. Right now, the median rent in Boise, ID is $1,750 per month, according to Zillow.
In summary, there are key differences between owning vs renting in Boise, ID. That said, buying and owning comes with far more perks than renting.
Currently, there is a 1.74-month supply of available homes in Boise.
Renting can be cheaper in the short term, but rental prices can increase over time. Buying a home involves higher upfront costs, but mortgage payments can be comparable to rent, especially with low interest rates.
Typically, it’s recommended to stay in a home for at least 5 to 7 years to recoup the costs of buying and selling a home.
Drawbacks of renting include rent increases, limited rental inventory, and restrictions (ie. pets, modifications, use of property, etc).
Owning allows you to build wealth through equity and property appreciation.
Yes, as a homeowner, you can enjoy tax deductions for mortgage interest, property taxes, and mortgage insurance premiums (if applicable).
Yes, Boise is a favorable market for first-timers because of its relatively affordable home prices compared to other nearby markets.
Some residents in Boise have misconceptions about mortgage financing that might prevent them from making the transition to homeownership.
For example, past surveys have shown that a lot of people believe they have to put down 20% when using a mortgage loan to buy a home. In reality, some mortgage programs allow for a down payment in the 3% range.
Additionally, home buyers can use money provided by a third-party donor such as a family member to help cover their down payment and closing costs.
The point being: homeownership might be more within reach than you realize.
Sammamish Mortgage serves home buyers all across Boise, Idaho, and especially the Boise metro area. We offer a variety of mortgage options, some with very flexible criteria, and can help you navigate affordable home loans in Boise. Visit our website to get an instant rate quote or call us today to have your financing questions answered!
Whether you’re buying a home or ready to refinance, our professionals can help.
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No Obligation and transparency 24/7. Instantly compare live rates and costs from our network of lenders across the country. Real-time accurate rates and closing costs for a variety of loan programs custom to your specific situation.