Owning a house is not always the best financial choice. Renting a home, apartment, or condominium more financial sense than buying a home if you aren't planning on staying for more than three years.

If you are staying in an area a long time, you may want the personal and financial advantages of home ownership. In either case, it is important that you understand how to make the most of your housing decision to protect and grow your money.

When does it make sense to rent a home?
You may not have saved enough money to use as a down payment or to pay the other costs associated with buying a home. If that is the case, renting is most likely your best option. Renting makes sense for other reasons as well. Here are a few:

• If you want or need the freedom to move easily from place to place.
  

• As a renter, you avoid the responsibility of maintaining a home. Instead of spending weekends on yard work, you are free to do what you want to do.
  

• You are not responsible for upgrading appliances, modernizing a kitchen, or replacing a leaking roof.
  

• You don't have to pay property taxes and special assessments.
  

• You avoid the risks that homeowners face—losing the money they invested in their home if housing prices decline. They also risk foreclosure, (the mortgage owner taking back the house) if they miss mortgage payments. As a renter, you avoid those risks altogether.

When does it make sense to buy a home?
While you may appreciate the advantages of renting, you should also recognize some important benefits of owning your own home. Assuming you have saved enough for a down payment on a home, you should compare the benefits of renting versus buying:

• Each time you make a monthly mortgage payment, you build equity in your home, which can be converted to cash by refinancing or selling your property.
  

• Most real estate properties appreciate in value over time, so your home becomes an important asset.
  

• You benefit from the tax benefits of mortgage interest and property tax deductions.
  

• If you have a fixed-rate mortgage, your monthly payments are set—an advantage for long-term financial planning.
  

• Your first home brings financial advantages of first-time home-buyer programs.

In addition to these financial benefits, there are other positive effects of home ownership. When you put down roots, you become part of a community and can benefit from the stability and security that provides. You can also enjoy a level of independence and freedom not possible when a landlord is in control of your living space. That means you can decide whether to have pets, change the décor of your home, or plant a garden.