We all know millennials are hyper-focused on creating and living a lifestyle they love, from forging unique career paths to exploring the world and emphasizing experiences over possessions. But as they enter the housing market, should this emphasis on getting exactly what they want even extend to attitudes about real estate? Or are starter homes an option they should consider?

In a recent Homebuying Insights Report, 56% of first-time homebuyers would rather wait to buy that “forever” home than buy a house that’s affordable for them right now. Although holding out for the dream house with the big backyard and brand-new kitchen sounds appealing, there is compelling evidence to suggest that buying a starter home now could be a strong money move.

Escalating Rent

Over the past few years, rents have been on the rise nationwide. By mid-2016, rent was up 4 percent over the year before, far outpacing the overall inflation rate of 1 percent. Research from the Harvard Joint Center for Housing Studies suggests that, as the population of renters continues to grow over the next decade, rent pressures will continue. Escalating rent can make saving for a home even more difficult.

On the other hand, with a mortgage, you lock in monthly payments for housing. While you could see some variation from things like rising property taxes or a mortgage with a variable rate, your housing cost situation is much more stable and under your control than it is when you rent. Starter homes could be the key to smoothing out your housing expenses.

Starter Homes Are Tangible Financial Assets

It’s the number one advantage to owning—and one you’re likely to hear over and over again. Homeownership provides the opportunity to put monthly payments toward an asset, like a house, that you’re building equity in. In many cases, this makes buying work out to be less expensive than renting as long as you stay for a few years. 

That means that even if you buy a starter home instead of a dream home your first time around, you don’t have to hold onto it for too long to make it a worthwhile buy. And there’s a good chance you’ll be better prepared financially when you’re ready to trade up.

Deciding to buy a starter home is not just about your renting alternative. It’s also about calculating what else you could do with the money you’d be putting into your home. With the current low-interest rates on CDs and savings accounts, buying real estate could be a better way to grow your money than simply stashing it into a savings account.

Tax Advantages Might Come With Your Starter Home

What many forget to include in calculations on homeownership ROI are the potentially significant tax advantages to homeownership. You may be able to take a deduction on the interest you pay on your mortgage and another on your property taxes (check with your tax professional for details). On top of that, if you buy a starter home and decide to make some fixes that improve its value, you may be able to factor what you spent on improvements to lessen the impact of any taxes you’ll have to pay on the home’s gain in value.

Home Equity Creates More Long-Term Financial Freedom

Once a homeowner builds up enough equity in a home, it can be used to create a better overall financial picture because it creates flexibility. You can draw on that equity to invest, pay off higher interest debt, fund education or even renovate the home. And when you do decide to trade up, hopefully your starter house will have appreciated in value giving you a leg up into your new lifelong home. Having equity means you have financial options.

So even though a starter home may not be the one you see yourself in forever, there can be advantages to getting into the housing market now.