Should You Rent Or Buy? The Pros And Cons Of Each
Envision yourself getting up to the sunshine bursting through your windows. And as fresh air fills your lungs, you head to the kitchen while being serenaded by birds, and cannot wait to enjoy breakfast with your loved ones. Every person deserves to have a home and relish all the pleasures that come with it. At some point in anyone’s life, he/she is bound to encounter thought-provoking dilemmas. Among these is whether one should rent or buy a house.
Deciding to rent or buy is your own personal choice. But you should always research the facts before you commit to anything of this financial magnitude. You need to weigh the pros and cons of each before making your final decision.
When you rent, you can have a house right away, and have it furnished for your immediate convenience. Its monthly cost is cheaper than buying a house and will enable you to save your money for other things. There will be other expenses, of course, but with the money you save on mortgage, you still have extra to pay off your electricity, water and other utility bills.
Renting a house offers lesser hassles with regards to tax and other legal matters. Your landlord will take care of these things for you. But the striking disadvantage of leasing a home is that you do not have the privilege to modify the structure of the house. You can only make minor alterations to its interior, depending on what’s stipulated in the contract. It won’t be practical to spend too much on something that you cannot own.
If you are the type who wants long term gains even to the extent of making sacrifices at present, buying a house is ideal for you. Unlike renting a house, the monthly cost may be a little steeper, but eventually it will pay off since you will be able to own the house after completing the payment terms. Your house would turn out to be a good investment especially when you need a huge amount of money. You can either lease out your house or sell it a reasonably higher price.
As implied in the previous paragraphs, owning a house becomes complicated when it comes to legalities. There are lots of paperwork involved with buying or constructing houses. You also expose yourself to the risks of foreclosure when owning a home, which are much severe than falling behind in your monthly rent. Foreclosure is the consequence of a decrease in your income or an increase in your expenses (e.g. unexpected sickness, loss of job, divorce, unexpected major home repairs, and others). The ultimate downside to buying a house is bankruptcy. This is most likely the result of a foreclosure since you are no longer able to keep up with your payments. Moreover, bankruptcy can still become a risk even when you pay your dues on time. How? This could happen, for instance, when you have to sell in a market that’s almost scrambling. This leaves you “upside down”, especially when the proceeds of your sale are not sufficient to pay off your mortgage.Finally, with deciding to buy a house, you have to pay a big amount, which means that you have to save a lot for your dream to become a reality. Also, maintaining a house requires a lot of effort and time especially if it is new. But what is a little sacrifice today in exchange for a more comfortable tomorrow?
Whether you want to buy or rent a house means you will have to make a serious deliberation in order to draw a more practical solution. There is no need to rush. It does matter to seek professional advice regarding this concern since this involves your long-term financial situation. Real estate consultants are there to help you.
Check out other articles of mine if you want to learn how to buy a house from scratch or learn the house buying process
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