Housing affordability is unnerving for many people, which is why you might be stuck at crossroads wondering whether to rent or buy. Unless you are eager to jump on the property ladder, this is never an easy decision to make.
Should you sacrifice a massive chunk of your life’s savings for a permanent roof to never renew contracts and deal with unscrupulous landlords again? Or should you rent an apartment in the city to enjoy the flexibility to move at any time with less upfront financial stress?
This decision ultimately comes down to what suits your personal and financial needs best. Here are the benefits of renting or buying to help you make the right choice.
Is Homeownership Right for You?
Most people reach an age where they feel they need to provide security for themselves and their loved ones by buying a house. Having your own property provides a level of confidence, and there are plenty of opportunities for you to get on the property ladder. This is a huge investment decision that requires a lot of planning and preparation.
Pros of Homeownership
Buying a house leads to a sense of freedom and security unlike any other. You can always rest easy knowing that you will never be evicted if you keep up with your mortgage payments. You will also never worry about your landlord suddenly increasing the rent, changing your lease terms, or being a pain and avoiding repairs that you need.
With your own house, you have all the freedom to make renovations and changes to add more value to the property. With each mortgage repayment, you can also build up your equity and use it to fund personal expenses, such as a new car, children’s education, renovations, and so much more.
There are plenty of gorgeous homes in the market in safe and friendly neighborhoods to make your family’s dreams come true. If you are looking online and typing house for sale near me, here is a great guide to help you find your perfect home.
Cons of Homeownership
Investing in a forever home is a daunting endeavor because it is such a long-term and permanent decision. You cannot uproot your family at the drop of a hat if you are unhappy with the location or need to switch jobs.
Buying your own home is also more costly because you need to put down a deposit, which is typically 20% of the property’s value. You will also need to pay other expenses and taxes, with ongoing costs like mortgage repayments and repairs. The value of your home can also decrease if the housing market is experiencing a sudden downturn.
Is It Better to Rent?
In many situations, renting makes more sense, especially if you are drawn to an area that is more affordable for renting than buying. You need a type of lifestyle for homeownership.
Most people with children prefer buying their own properties, while single and young adults enjoy the freedom and flexibility of renting. This way, they do not need to commit to a property for longer than a few months or a year. A renter can quickly relocate to another location.
Pros of Renting
Renting a house is all about flexibility because you can move anywhere you like when your lease ends. You can pack your belongings and walk out the front door instead of organizing viewings and buyers to buy the property before starting your new life. You also do not need to pay for the upkeep of a property.
Maintenance and repairs are your landlord’s responsibility unless you are the one who caused the damage. The landlord will also take care of taxes and other fees while you are expected to keep the home clean. In many places, renting turns out to be cheaper than buying.
This is because cities have the most expensive properties that most young professionals cannot afford. Therefore, it makes more sense to rent a house to stay close to downtown, nightlife, public transport, late-night shopping, and so much more.
Cons of Renting
Your landlord can always ask you to leave after your lease is over. It does not matter whether you have spent years at a property and built a life there.
The landlord may decide to move in themselves or sell the home, in which case you will be asked to vacate with little notice. You can also be evicted if you miss your rental payments and have limited rights because the property does not belong to you.
You are not allowed to make structural changes, like painting the walls or drilling any holes. If you are going to have a baby and want to decorate a children’s room with new fresh walls, you will need permission.
Landlords also demand a security deposit before you move in. This deposit is paid back to you after vacating the property if there are no damages.
However, many landlords have a reputation for making excuses or finding minor faults to withhold this money from renters. Then you will need to argue with them back and forth about cleaning and repairs after you move out.
Your rent money is also not an investment because you will never get it back. When buying a house, you are building equity that will eventually pay off your mortgage.
Renting does not lead to any return apart from providing a temporary roof over your head. Rental payments benefit your landlord more because they pay off the owner’s mortgage instead of yours.
Is It Better to Rent or Buy?
Deciding to rent or buy is a personal choice that can be challenging for most people. It all depends on the lifestyle you have and want to maintain. To provide long-term security and stability to your children, you may prefer buying a house.
This way, you will never have to leave the property. You can also pass it down to your future generations. However, young professionals who do not have the funds for the initial down payment and want to live in the center of busy cities will lean closer towards renting a property.
The final decision comes between your own personal and financial situation. If you enjoyed reading this guide, check out some of our other articles for more information.