Renting vs. Buying: Which One Is More Suitable for You?

Deciding where you will live is such a huge thing to think about. First and foremost, there are so many things you will have to consider. While many are choosing to buy property, how do you know if it’s the best option for you? Before jumping into a major decision, it’s important to carefully look at its pros and cons. There are always risks involved, but if you know each option from opposite sides, you make a better judgment. Investors often struggle in deciding whether it’s renting or buying that's better. Especially now that the property market can be quite unpredictable, making this decision has become even more tricky. If you’re trying to figure out which of these options will be more suitable for your current situation, here are some questions you will need to answer before making your decision.
- What can you afford right now?
- How long do you plan to stay in the home?
- What are your short-term and long-term plans?
- Are you prepared to spend money on improvements and maintenance repairs?
- Is stability or flexibility more important to you at the moment? RENTING Pros - Most of the time, people choose to rent because of their current financial standing. Simply put, it’s the option that they can only afford at the moment. We all know that buying a home can be incredibly costly and requirements can be strict. Although renting would require renters to hand over a security deposit, it’s still cheaper to rent than to buy. - You have more flexibility. If you’re someone with a sort of an active lifestyle where you can get relocated any time because of the job you have, renting would suit you better. - For instance, in six months to a year, you noticed that the neighborhood doesn’t work for you, you can easily move out and change location. Cons - As a tenant, you are bound by the rules imposed by the owner which means, any kind of renovation is strictly off limits unless there’s some sort of agreement made about this. - Any kind of changes, whether it’s internal or external must have the owner’s consent. You cannot make any decisions without his or her approval. - Unlike a property you own, there is no return of investment since the property does not legally belong to the person renting. If the contract expires, there’s no guarantee that it will be renewed. BUYING Pros - If you are looking for long-term benefits, buying a home is more suitable for you. There’s growth in terms of personal wealth, and at the same time, there’s equity and more security. - Investing in property such as buying your own home has the potential for profit in the future. Property value appreciates over time, so if you decide to sell it in the future, you’ll definitely make a huge profit off of the sale. - As a homeowner, you have all the freedom to do what you want with your property in terms of renovations or improvements. You don’t need a landlord’s approval if you want to change the look of your house because it’s yours. Cons - The reason why a lot of people are having second thoughts when it comes to buying property is because of the huge financial responsibility that comes with it. Home-ownership includes repayments and maintenance fees, plus taxes and other additional costs. - Unlike renting, flexibility is one of the things that you will need to sacrifice. You can’t just move out if you feel like it. There are more things to consider if you own the house you are living in. - If you decide to sell, there are risks involved, such as not making the profit you’re expecting off of the resale. It may take a while before you can actually find a buyer, so it’s important that you are ready for that.