Tax Deduction

• If the monthly house payments are approximately the same as rent for a comparable property, the amount paid at the end of the year for housing can be less when buying. When buying a home using a loan, a significant portion of the house payment is interest. At the end of the year, the homeowner deducts the interest from his gross income, thus lowering his tax liability. Even when the homeowner factors in property tax, after claiming all income tax deductions afforded him, the buyer can end up with more cash in his pocket at the end of the year.