Renting vs. Owning – What you need to know
At some point, most of us will ask ourselves the question “Should I continue renting or should I buy a home?” While some dream of the day when they are handed a set of shiny keys to their new home, others would prefer to make a quick call to the landlord when the A/C stops working (for the third time). Here are some points to consider when making the big decision.
How long do you plan to stay in the area?
Renting allows for more flexibility to move locations quickly. Something to consider is your career and whether it will require you to relocate frequently. Especially if you are just starting out, there may be a higher chance that you may need to move. Figuring out how long you will be in a location is a key factor in making the decision to purchase a home.
Owning a home offers a level of security that many people crave, especially those getting married or starting a family. The turnaround time for moving can be a bit longer than when renting, but putting down roots in a location can bring stability to you and your family.
There is also something to be said for the sense of community that owning a home allows for. Think back to your childhood, chances are a good portion of it was spent playing with other kids in your area. Renters who relocate often miss out on the opportunity to build these relationships.
What is your financial picture?
While not always the case, many people rent when they are not sure they can afford to purchase a home. They may have income uncertainties around their job, or bad credit. Although these factors do play a part, many people are surprised that they are eligible to buy a home much sooner than they would have guessed. Want to find out how much you can afford? Check out our True Affordability Tool to find out how ready you are to buy a home.
Owning your own home may provide you with tax benefits and will allow you to build equity. When you pay rent each month, that money is essentially never seen again – it is simply a trade for being allowed to live in the home. When you purchase a home your mortgage payment each month contributes to the goal of owning the home outright.
Have you planned for home maintenance/repair fees?
When renting, the landlord usually covers any maintenance or repair fees. The downside is that you are at the mercy of your landlord as to when the work is completed. You may also disagree with the individual or company that is chosen by the landlord to perform the work, but unfortunately most renters do not have a say in this matter.
When owning a home you get to make the decisions around when and if maintenance should be attended to. There is no waiting on a landlord who is dragging their feet to make the repair on your noisy dishwasher. You also get to pick who performs the upkeep or maintenance on your home.
How much freedom would you like to personalize your home?
The amount of creative control you have with your home will highly depend on your landlord. Most landlords do not want things changed in order to keep it as renter friendly as possible. Your favorite color for the walls may be the next renters least favorite, and then the landlord gets stuck painting the walls back to a neutral color. Oh and don’t even think about getting a pet, IF the landlord even approves, you will most likely pay a pet fee every month and lets just hope it is house broken.
Want to remodel the kitchen, change up the landscaping or get a pet? Get going because there is no one to ask since YOU own your home. Owning offers many perks when it comes to allowing for creative control. Not to mention the money you spend on building a fence for the back yard won’t go to waste when your contract runs out next year.
Still unsure as to where you stand? Nestiny is a great place for homebuyer education and to help gauge how ready you are to buy a home. Journey Homeward allows you to enter all of your wants and needs while the True Affordability Tool will break down your budget, showing what you can comfortably afford. You will also receive a free Ready Report that is personalized based upon the information that you entered. This report will give you a vital head start in the home buying journey, saving you valuable time and money. So what are you waiting for, get started on your journey today!