Rent or Buy? Pros and Cons for Both!
There are many questions to ask yourself when considering to rent or buy property. In fact, that choice is one of the biggest financial decisions that adults make! But the costs are varied and complicated, which makes it difficult to decide the better deal.
Real estate ownership is a prized investment that helps build equity and is a source of tax deductions. But renting also has several advantages, especially for someone nomadic, such as little to no responsibility and flexibility. However, people usually believe that buying a home instead of renting is a more financially sound investment. But let’s first analyze the pros and cons of both.
Renting means you can move without a penalty every few months, which can be a positive thing for many people who are unsure of the area or type of home they want to live. However, things can change when it comes to renting, like the cost of rent and utilities. While it is true that you aren’t building equity with monthly payments, not all the costs of homeownership go towards building equity.
Homeownership brings intangible benefits, such as a sense of stability and pride of ownership. Real estate is an asset, but it is not for the restless. You may not be able to sell if the market is down, so changing your mind about where you want to live is a dangerous decision when you own a home. In addition, the overall cost of homeownership tends to be higher than the overall cost of renting – even if the monthly mortgage payment is similar to (or lower than) the monthly rent. Expenses as a homeowner include property taxes, trash pickup, repairs and maintenance, homeowners insurance, and more.
Overall, renting offers flexibility, predictable monthly expenses, and someone who can take care of repairs. Homeownership brings intangible benefits as well, such as a sense of stability, belonging to the community, and tangible tax deductions and equity.
Whatever option is best for you, it shouldn’t be all about money. It is about your goals and vision for your life. If you want professional help, we are here for you! Our loan officers will help you evaluate your specific situation to enable you to make the right decision. Contact us today to get in touch with our team.