Is it Better to Buy or Rent Your Home?

The decision to rent your home or to invest in buying property is a difficult one, and there are advantages and disadvantages to each option. Your decision will depend on your lifestyle and your priorities, but here are the pros and cons for both renting and buying:

The Case for Renting

One of the main advantages to renting your home is that you will not have to worry about all of the extra expenses and maintenance that comes with being a homeowner. You are not responsible for water, electricity, property taxes, gas bills, and maintaining the property. Some rental arrangements will charge you for utilities, but most of the time they will be included in the rent. If something breaks or needs repairing, your landlord will take care of it. This arrangement is very hassle free, as you just need to pay your rent per month and your landlord is responsible for taking care of the property.

Renting also makes a lot more sense if you only have short term plans to live in the area. If you think that you might want to move within the next few years, it makes no sense to buy a home and start paying it off when you will just have to sell it right away. Buying property only makes sense if you think you will want to live in the area long enough to pay off your mortgage and allow the property value to increase a decent amount. Renting gives you the flexibility to relocate easily.

The Case for Buying a House

One of the frustrating aspects of renting is that even if you pay monthly for your home for 10 or 15 years, when you move out you own nothing. The longer you rent, the more you are spending money without the investment of actually owning a home. If you opt to take out a mortgage and buy a home, you will be investing your equity in the property. If you are planning to stay in the same place for a decent amount of time, it makes a lot more sense to be in the process of paying for your own home rather than paying rent on someone else’s.

Buying a home also allows you certain tax breaks, such as being able to deduct your mortgage interest and your property taxes. Also, owning your own home gives you the freedom to undertake renovation projects to improve your living space and increase your home’s value.

If you own a house with an extra bedroom or a separate suite, you will have the option of taking on a lodger. The rent that your tenant pays can help you cover your mortgage and save you a lot of money! When you pay off your mortgage and own your home outright, you are in a very desirable financial position because you will be basically living for free (excluding any utility costs). If you still have tenant at this stage, you will be making money from your home.

There are advantages and drawbacks whether you rent your home or buy it, so take into consideration your finances, needs, and plans for the future to decide which is the best option for you and your family.

Jim Dean is a blogger who likes to write about property and interior design. He also works for Access Legal who offer help to those who are selling a house.

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