Whether you live in an apartment or in a house, you may be wondering which is better: to rent or to own. Well, this really depends on what’s most important to you, how much responsibility you want, and what you can afford.
Let’s take a look at some of the pros and cons of renting and owning your own home.
Here are some pros of renting a place:
·You don’t pay property taxes or homeowners insurance
·There may be some expenses and utilities included in your rent, such as water
·You aren’t stuck in one place. You can give notice to end the lease and move somewhere else if you aren’t happy where you are renting
·If something big or expensive breaks in the house, like the air conditioner, the owner is usually responsible for paying someone to come and repair it for you
·Renters insurance is about $15 to $30 per month, which is much cheaper than homeowners insurance
Here are some cons of renting a place:
·You need permission to make changes around the house. For example, you can’t put nails in the walls to hang pictures without written permission
·You need to follow all the rules in the lease agreement, or you may be fined or kicked out
·The owner may choose to sell the place and end your lease, which means you need to find a new place to live (and let potential buyers in to view the place)
·The owner may decide to increase your rent
·You don’t benefit from the tax incentives offered to homeowners
·The lease agreement may specify that you need to let the agent in to inspect your home at certain times of the year
The pros and cons of buying a place
Here are some pros of buying a place:
·If you pay your mortgage payments on time, you should be able to build up a good credit score
·Instead of paying rent to another homeowner, you pay off your own mortgage every month and build equity
·You can take advantage of tax deductions, with property taxes and interest on your mortgage being tax deductible
·You can decorate and renovate the place as much as you want
·Your investment may pay off in the future: Property usually increases in value over time, so you should be able to sell the place for more than what you paid for it
Here are some cons of buying a place:
·You will need to save enough money for a down payment on the mortgage and to pay the closing fees
·You cannot easily pack up and move because you will need to sell or rent it out first
·You are responsible for the upkeep, repairs and maintenance costs when you own the property
·Homeowners insurance will cost about $80 per month, which is much more expensive than renters insurance
Which is it?
Renting tends to be cheaper with fewer responsibilities, but you are restricted by what you can do there and you don’t benefit from investing in property.
Owning property can get expensive with down payments, insurance, and maintenance, but it is often a good long-term investment that offers tax deductions and a nest egg for the future.
So, in your opinion, which is best? Renting or buying a property?