Do you rent, or do you buy? It’s a crucial question and a big financial decision (it’s not an easy decision). This dilemma doesn’t just hit young adults who are working their way up in life, it also targets empty nesters, the recently divorced, and the retired.
If thinking about buying it’s important that you ask yourself these questions: how long do you plan on living there? What does your future look like? Most importantly, can you afford it? There are a lot of upfront costs when buying a home, like a down payment, home appraisal, the home inspection, and other closing costs. Don’t forget about the recurring (monthly, yearly) expenses: mortgage, property taxes, water and electric bills, and the occasional maintenance expense.
Home owning is a big financial responsibility (as well as a personal responsibility) and not everyone is up for the task which makes renting a home a more attractive option. Some other appealing aspects of renting are:
Flexibility- renting offers a lot more flexibility that you don’t have when owning a home. Plus, renting is a great way to settle into a new city, it gives you time to explore the new city and it’s surrounding neighborhoods so you can find where you really want to live.
Uncertainty– This plays into the flexibility aspect of renting. Life uncertainty, career uncertainty, and financial uncertainty, renting has got you covered (terms and conditions vary). In all seriousness–it’s true– who knows where you’ll be in 5 years time. Instead of purchasing a home and having to move in a few years time because your family grew, a new job, or a job loss you can rent.
No Maintenance– As a renter there is no need to worry about maintenance expenses, and that’s a huge money saver. It’s all in the landlord lap; a gas leak, septic tank issues, broken pipe, or a leaky roof, so that’s a financial comfort.
While renting a home has a lot of appealing aspects there is just one downside…it’s not yours. A lot of people want the permanence and the creative control of owning a home, and you don’t get that when renting. Here are just a few advantages to owning a home:
Good Investment: If you plan to stay in your home for a long a long period of time the house’s value can increase…that is if you keep up with the house. Also, when your home increases in value, it can create more equity for you.
Establishing roots: Buying a home is a great way to build your on future, expand your family, and establish roots in a community
that will lead to a lifetime of memories.
Building Equity: Equity is the value of your home minus what you owe and that equals your home’s equity. The home equity is the actual dollar value of the home that belongs to you. You can build equity a couple ways, and one of those ways is a gradual process that happens over time. As your house increases in value, it builds more equity for you. The other way of creating equity is through your monthly mortgage payments, so every time you pay off your loan your build a bit of equity.
Creative Control: Landlords might not let you paint the walls, own pets, put in a garden, or add updates to the house. Owning a home means you can grow with the house to create the oasis you’ve always dreamed of. If you choose to expand your family you can expand your home, and that’s something you don’t get with renting.
At the day of the day you have to live somewhere, whether you decide to rent, or decide to buy it’s important that you weigh your options, talk to professionals, figure out what your future look like,and most importantly make the decision that best fits you, your future, and your lifestyle. Any house (rented or bought) can become a home.