Most people often get frustrated when it comes to choosing between buying and renting a home. While there are pros and cons to each choice, it is good to understand why you should choose one over the other.
There is no easy way to go about it unless you know how both sides work. Some people often make choices based on what others are doing. But this can be a risky step. Below are several things to consider before you make your final decision.
Pros for Renting
Renting is an ideal choice if you want short-term housing. If you’re not sure of staying at a place for long, then go for renting. It is possible to sign a short-term lease and move out when it expires instead of committing to paying a long-term mortgage that might not give you financial freedom.
When renting a home, you do not have to worry about home repairs and maintenance, homeowners association, property taxes, insurance, or subcontracting a real estate agent to take care of various aspects of the property. This is because such liabilities belong to a homeowner. You will only have a few responsibilities like paying for utilities.
No Risks Involved
You can rent a home without taking huge risks. If you decide to buy a home, you may need to take a loan to finance it. This can be a risky investment, especially when it comes to high-interest rates. Sometimes, you may not secure the loan due to various reasons. Therefore, go for renting if you do not want to risk higher costs involved in homeownership.
Easy to Share
Renting a home is easier if you plan to live with someone you can share the expenses with. You can still move out without any legal challenges in case the deal doesn’t work out. This isn’t the case with owning a home because it comes with costly implications during the separation of spouses, where the couple goes through a legal process for property ownership.
Easy to Secure a House
If you plan to move to a new area, it is easier to get a rental house than buying one. This is because you don’t have to go through multiple processes involved in homeownership. You will have more time to research various houses before making the final decision. You will also not need a lot of paperwork, unlike when buying a home.
Pros for Buying a House
You Have All the Freedom
Even though some states have few guidelines for homeowners, you’ll still enjoy freedom in your home. You can own pets, paint your house, remodel the interior and create a beautiful landscape with curb appeal. The improvements can increase your property’s value, giving you a higher return if you decide to sell your home.
When you secure a mortgage, you will need to make a down payment. Even though this may sound like a hard nut to chew, it is worth it because it earns you more equity. The equity can help you borrow a loan against your home at better rates. However, this is not so when it comes to renting. You pay your rent to the landlord without benefiting in any way.
Pride of Ownership
Homeownership comes with a great feeling. It makes you feel proud of your achievements. It offers a sense of security and gives you peace of mind, knowing that you have a place to call home for life. This is not so when renting a home. You have no degree of homeownership.
The Bottom Line
Do not get influenced by your family or friends when you want to buy or rent a home. The decision solely depends on personal preferences. Using the guide above will help you make informed decisions. It’d be best to take time and do in-depth research before deciding which way to go.