To Rent or Buy a Home? The Great Debate

Its the age-old debate: Should I rent or buy a home?

Making the decision to rent or buy a home is no small feat. It requires careful thought and consideration of both the pros and cons of each option.

Both renting and buying have their own unique sets of advantages and disadvantages, so it’s important to weigh all your options before making a final decision.

Let’s break down why either to rent or to buy a home may be right for you.

Renting Pros:

Renting can be an attractive option for young adults because it offers more flexibility and little-to-no upfront costs.

When renting, you don’t have to worry about any upfront costs beyond your security deposit and first month’s rent. Depending on what type of rental you live in, (apartment, home, Duplex, etc) you may only be responsible for some but not all the utility bills as well.

Additionally, if something breaks in your rental unit, chances are the landlord will take care of the repair cost—a major plus!

You also don’t have to worry about property taxes or maintenance fees, as that responsibility lies with the landlord as well.

Renting is also great if you might move soon due to job relocation or other life changes as most rental contracts only last 12 months. This means that if you do need to move unexpectedly, you won’t be stuck with a long-term commitment like mortgage payments on top of moving expenses.

Plus, since your rental unit belongs to someone else, you don’t have to worry about lawn care or landscaping like you would with owning a home.

Renting Cons:

On the flip side, when renting you may still have to abide by certain rules set forth by the landlord or homeowner’s association.

You also won’t build any equity in a house that isn’t yours. 

Another con of renting is that you typically won’t have the same privacy as owning a home. Since you don’t own the residence, your landlord or homeowners association may enter your unit at any time to inspect or make repairs.

You could also be subject to random noise from neighbors or other tenants in the building.

Buying Pros:

Buying a house has its own set of advantages and disadvantages. It can definitely be worth it in the long run if you make smart decisions when purchasing.

One major benefit of purchasing property is that it will eventually become an asset. Over time, it will increase in value as long as you maintain it properly. You also get access to equity within that property which can increase in value over time as you make your mortgage payments.

Owning your own home can provide stability and security from unexpected rent increases due to market fluctuations and inflation over time. This in turn can save money in the long run compared to renting for many years. Mortgage payments remain relatively flat(depending on your mortgage rate product) while rental prices can go up over time.

Plus, when you own your own home you can make renovations as needed without having to worry about getting permission from landlord—you are the landlord! Renovations made on owner-occupied homes are often tax deductible as well in some places, which provides additional savings throughout the year.

Buying Cons:

However, when buying a home there are significant upfront costs like closing fees, attorney fees, and down payments (depending on your loan). There are also ongoing expenses such as property taxes and upkeep/maintenance fees so if something were to break down or need repairs, those costs would fall on your shoulders as the homeowner. 

You will also incur additional costs for insurance and property taxes. Property taxes are levied by local governments to fund public services, such as schools and emergency services. They are typically based on the value of your home, and can be costly if you live in certain areas with high property values.

Two other costs associated with owning your own home are Home Owners Insurance and Mortgage Insurance (if your mortgage is government back and you have less than 20% equity in your home) is another required fee associated with owning your own home.

The decision between renting or buying really comes down to personal preference at the end of the day; what works best for one person may not work best for another person in different circumstances.

Weighing out all pros and cons may help narrow down which option is best suited for where you are in life right now. Both purchasing and renting have positive aspects that should be taken into consideration when determining what works best for your situation!

Good Luck!