Varied methods to sell the house

How to buy a first home: mortgage or cash?

Is it more convenient to buy a house by paying for it in cash or by taking out a mortgage? What are the advantages and disadvantages of one or the other choice? All questions answered.

When you decide to buy a house, in addition to the enthusiasm for a new beginning, concerns can arise. One of the most frequent and most legitimate doubts concerns the choice of payment method.

Buying your first home with a mortgage or cash?

Paying in cash avoids taking on a debt with a bank , but this choice can leave little liquidity available. Conversely, with the mortgage you pay little at a time – so it is certainly a more sustainable solution for most Italian families. On the other hand, however, the commitment to the bank can take a very long time : mortgages can last from 5 to 30 years during which you will also have to pay interest expense

Many today choose to buy part of the house in cash and part with a mortgage, so as to be able to maintain liquidity to deal with notary fees , taxes and furnishings, as well as daily expenses and unforeseen ones that can always happen.

According to the data published by the MutuiOnline Observatory, in the first quarter of 2018 mortgage applications decreased, but those aimed at buying a first home are more compared to subrogations and occupy 48.1% of the entire sample surveyed.

Furthermore, according to the Observatory, the incidence of shorter (cheaper) durations is growing , and the volume of the average amount of the request is slightly decreasing, equal to €126,377 against €128,581 in the fourth quarter of 2017.

Finally, the Observatory traces the profile of those applying for a mortgage : they are mainly from northern Italy (46.5% of cases), are between 36 and 45 years old (44.1%) and have a permanent job (82, 1%) with a salary between 1,500 and 2,000 euros (37.4% of the sample).

But in the end, what should you do? In the post we will see the advantages and disadvantages for each solution and the related tax breaks , but first it is good to remember that for those who buy their first home there are some tax breaks – called first home bonuses – which allow you to save on taxes.

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