Renting Vs. Buying - Which One Makes the Most Sense for You?
Renting or buying… which is right for you? Both sides of the housing coin offer their own unique advantages and disadvantages, and whether you choose to rent or buy comes down to which set of pros and cons best suite your current and long-lasting needs.
Renting and buying both have their hardcore advocates. On the one hand you have advocates of buying who argue renting amounts to nothing more than throwing cash out the window when you have to. On the other hand you have advocates of renting who argue buying doesn’t always represent the sure-thing type of investment we all like to see it as.
So who is right in this debate?
Well, when it comes down to it both sides are right and both sides are wrong. There is no monolithic answer to the renting vs buying debate. Instead, everyone needs to determine which option makes more sense for them at this current moment in their life.
And to help you make that decision we’ve compiled some of the most powerful Pros and Cons related to both renting and buying.
- Tends to cost less money every month than buying.
- Good if you don’t want to live in your city, town, neighborhood or any one specific place for a long period of time.
- Offers a lot of flexibility and choice.
- If you find a rent-controlled apartment you can keep your housing expenses regardless of whether the value of your home or your neighborhood increases.
- When you rent you’re making someone else (your landlord) richer without building any equity yourself.
- You still need good credit to rent a great property.
- You don’t have total control over how well your property is taken care of. The quality of your living experience often depends on decisions made by your landlord.
- You don’t have control over who lives near you, whether within your building or within neighboring rental properties.
- Buying a home builds equity. It’s very likely you will earn a profit on your investment whether you finish paying off your mortgage or even if you flip your home in a couple years.
- Home buying can be worthwhile and profitable whether you’re looking for a long-term living situation or simply somewhere to live for five years.
- Home buying offers a better situation for a long-term living situation than renting.
- Buying gives you total control over your property. You won’t need to put down deposits to own pets, you won’t need to wait to have the plumbing fixed and you won’t need to beg to be able to paint your living room.
- Sometimes you won’t earn as big a return on your property investment as you initially anticipated.
- Buying is a greater responsibility. You will have more control over your property but you will also need to be the one who takes care of it. You be able to just call your landlord when there’s a problem and tell him to “fix it.”
- You need to put in a down payment to own your home. Down payments are often considerably more expensive than the first, last and security you need to put in for an apartment.
- When you buy you need to jump through more legal and regulatory hoops before you can move into your property.
Overall it’s up to YOU to answer the question by determining which of the pluses and minuses of renting vs buying is right for you, and that decision often comes down to your current life position and what you’re looking for out of your next home. If you are leaning towards buying, a home mortgage calculator can help you identify a range of price points you can afford in purchasing a home.