Renting or buying a home is a major decision that everyone has to thoroughly process at some point in time. Before embarking on the journey, take into consideration some factors such as your lifestyle, financial situation, and employment. These elements will allow you to make a better decision and sway the answer to one side or the other.
Pros of Buying
-Enjoy the sense of ownership – a fully-paid home is the ultimate provision for you and you loved ones.
-If the home appreciates more than you’ve paid in mortgage, interest, taxes, and maintenance over time, you’ve earned a return.
-Your costs are predictable and more stable than renting because they’re based on a fixed-rate mortgage.
-You have the option of buying to rent, which enables you to generate income from renting out the property. This income can be put towards the home loan.
-Living in your own home allows you to enjoy the freedom to renovate and decorate is as you wish.
Cons of Buying
-You will have to come up with a higher down payment.
-Ownership costs are more than just a deposit; there are ongoing running costs such as repairs, insurances and property taxes.
-The interest and fees you pay for your loan can be significant. Br prepared for interest rates to fluctuate during the term of your loan, especially if you have a variable interest rate.
-If you decide to rent you house, it is your responsibility to find a tenant.
Pros of Renting
-Enjoy flexibility – you can move from place to place due to work, or try out different neighborhoods.
-Fewer obligations – you don’t have to pay for major repairs, maintenance, property taxes or other issues that come up during the tenancy.
-Makes for great short-term options. Whether you are working on saving money or mentally preparing for the responsibility or owning a home, this is the best interim option.
-You rent will generally be stable throughout your lease. In a rocky housing market, renters are not as much affected as buyers.
Cons of Renting
-You can not make any major structural changes to the property, you will be required to ask for permission.
-You are basically paying someone else’s mortgage.
-The greatest disadvantage for renters is there is zero return on your investment for rent payments.
-Inability to build equity, because you home will not be your own property.