Whether you decide to buy or rent a home, the best possible choice will be determined by your unique financial situation and lifestyle.
Even though the majority of people believe that owning a home grants more benefits, such as it being a growing investment and rewards one with tax deductions, renting should not be dismissed so easily. It has its charms too.
The pros and cons of either option are relative to your personal circumstance and preference.
We will consider the pros and cons of each option separately here. It is up to you to decide which one suits your lifestyle the best.
The Pros and Cons of Owning
Owning a home in America has always been seen through our cultural perspective as something desirable and the ultimate goal for success in life.
This is because the economy is also largely based on real estate, as it directly benefits real estate agents, mortgage lenders, as well as DIY stores and businesses.
However, it does appear to have substantial advantages, such as increasing investment and tax deductions, what is mainly gained through owning a home is mostly imperceptible and relative.
A sense of community, stability, security and pride, is what homeownership can bring to us, but the importance of these abstract aspects may vary greatly from person to person.
A major con that needs to be considered is the fact that no matter the housing market, transaction costs are extensive. When you want to relocate as an owner, it can be a much more costly and complicated scenario than renters have to face.
Additionally, you can always run the risk of owning a home within an area where the market is down. Selling your home will become much more difficult and time-consuming.
Homeownership related costs, when it’s all considered together, can run higher than that of renting. Your mortgage payment each month may be slightly lower than paying rent, but people tend to forget about the other expenses and responsibilities related to owning a property.
Maintenance and repairing costs, trash pickup services, property taxes, homeowners insurance, pest control and water services, to only mention a few, are these extra expenses to consider.
The Pros and Cons of Renting
Are you the type of person that likes to move frequently? Renting might be the best option for you, as you will not have to carry any additional expenses when your lease ends and you want to relocate.
Though this is a definite pro, a major con of renting is that it does not provide as much stability as homeownership. A landlord may sell the property or increase the rent, which will force the renter to move out or end up having to pay more than they bargained for.
In the sense of building equity, which is a benefit when you’re an owner, paying rent is perceived as a waste of money you basically throw down the drain each month. This is not entirely true.
Yes, it’s true that you are not building your equity when you rent, but in the case of homeownership, not all the expenses will go towards this purpose either.
Another pro of being a renter is that you have a predictable amount to be prepared for each month, whereas when you own, you might end up having to spend more this month due to maintenance or repair costs.
Whereas being a renter, fixing the plumbing or the electricals, for example, are unpredictable and expensive problems that do not need to be faced by your own purse.
Therefore, many people may prefer to avoid all these additional costs and rather invest it into a retirement savings account than spending the money towards a home.
The Decision Is Yours
Considering some of the main pros and cons regarding owning and renting your home, it is a decision that you as an individual should make in relation to your unique wants and needs because circumstances and market statuses vary greatly.
Your choice does not solely depend on your financial situation, but also rely on what grants you comfort and fits into your specific goals and life vision.
Now that the myths of renting, that it’s a waste of money, and of homeownership, that it builds wealth and saves money has been addressed here – has your view regarding this dilemma become clearer to you?
How has the realization that owning a home isn’t necessarily better than renting, and renting alike is not as simple as it appears affected your decision of what is best for you?
Are you in need of any assistance in this regard?
Contact us today!
Reddtrow Properties can help you consider all your options regarding the housing market and your life circumstances!