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Rent or buy? That is the question! Different people will give you different opinions and tips, but in order to cut through the noise, here’s a fool-proof analysis of the pros and cons of renting vs. buying a home you might want to study and keep in mind when the moment of truth comes.
How Many Expenses Can You Handle?
When moving from your old home into a new one, the most important thing to consider is definitely your financial situation. Having a clear picture of how much money you have in your pocket will easily tell you whether you should rent or buy a property.
If you’ve been saving diligently for the past several years, you might be able to buy a house without the help of a bank loan and having to suffer high interest rates. But, if you can’t afford that move, renting might be a better option, especially when you’re interested in living in an up-and-coming area where rents are low and much easier to cover than paying off huge loans.
Short-term loans may also be an option when it comes to getting a down payment, but generally that would hurt your potential for getting a mortgage loan for the property.
Are You Thinking Long-Term?
If you’re undecided about whether you should buy or rent, make sure to think long and hard about your future. Do you see yourself changing career paths in the next few years? Are you willing to move to a new city or country for work?
If you’re not too tied down to a place, it’s smart to rent until you figure out your career path. But, if you’re 100% satisfied with your career and have plans to start a family, you might want to buy a house.
If you’re planning to earn some money on your property right now or in the future, buying a duplex for investment is a great idea. You will be able to live in one part, rent out the other, and adapt to any future changes in your family or financial situation.
How Important is Stability for You?
When you’re a tenant, the only 100% certain and stable thing in your life will be rent at the beginning of every month. And the worst thing is that you’re paying for a place that will never be yours, no matter how long you stay there.
When paying off a mortgage, you will end up with a place of your own at the end which can be very motivational. Additionally, rent prices are almost always going up thanks to inflation and higher costs of living.
Renters always need to be prepared for higher rent and even relocation if your landlord chooses to sell, so if stability is key to your happiness, buying might be a better solution for you.
How Much Maintenance Can You Afford?
Being a homeowner gives you a lot of freedom, but it can also make you a slave to your house. It comes with a lot of responsibilities in the form of repairs and maintenance with no one else to deal with them but you.
These chores are not only time-consuming and nerve-racking, but also costly, so it’s another expense to keep in mind. However, when you’re renting, you only need to report certain maintenance issues, and your landlord will cover them. So, it’s very responsible to consider maintenance tasks and whether you have the time and money to deal with them year after year.
If you decide to buy a property, don’t hesitate to find a good home inspector to warn you of any potential red flags. And make sure you brush up on your DIY skills.
How Important is Design for You?
Of course, we all strive to spend every day in a home that’s a true little work of art. Having a perfect home usually includes having enough room for every activity you can imagine, having a layout that’s modern and colors you like. When you own a home, you can basically do whatever you like to it, no matter how unconventional and over-the-top your dreams are. You can even buy a house, renovate according to your tastes and move after everything is perfect.
But, if you decide to rent, forget about making any calls when it comes to changing something or not. You will need to consult with the landlord about any change in your house. But, if you’re reasonable, your landlord will cover the expenses most of the time.
Obviously, both options have many pros and cons. Being a homeowner offers investment possibilities and the freedom to manage your property whichever way you want. On the other hand, being a renter offers easy ways to move and has lower upfront costs. Whether you should buy or rent depends on your abilities and wishes and if you consider these aforementioned points, you will surely make a good decision.
Derek Lotts is an experienced freelance writer and researcher. His main areas of interest are small business, home improvement, and sustainable living. He strongly believes in the power of sharing knowledge and ideas through the mediums of modern technology.