It used to be that buying a house and/or land was an indication you were all grown up. Well, nowadays, ‘adulting’ comes with a lot more options than it did for our grandparents and with that, more decisions. Let’s take a look at the pros and cons of renting versus buying so you can make the best decision for you.
First, consider what your personal lifestyle is. If you are a world traveler and adore living in different cities every year, buying may not be for you. Renting affords certain flexibilities that buying doesn’t. Sure, you can always rent your home out, but that also comes with responsibilities you won’t have to worry about as a renter.
Next, consider the costs of home repair. If you are a self-proclaimed MacGyver and can fix anything, then repairs and upkeep might not be an issue for you. But, if you enjoy turnkey housing where everything is either new or maintained without having to do much more than inform your landlord or property manager of a problem, you should know that owning a home is the opposite of that scenario. As a homeowner, home maintenance is on you, not the landlord. You’ll need nimble finances in the event of a housing emergency like a broken pipe or air conditioner that breaks down in the middle of the hottest summer on record.
Mortgages are often less expensive than rent. If you are a renter, chances are you’re going to spend more on housing costs than if you were a homeowner. Depending on the market where you live, the cost of living, and your mortgage rate, you could save thousands of dollars each year by buying your home, versus renting it. Some renters are shocked when they add up all the money they have spent on rent over the years, only to find out they’ve purchased a home several times over. But, that’s not really the most accurate way to look at it. For a closer look at the economic factors of renting versus buying, check out Nerd Wallet’s specialized calculator. In most cases, over the long term, buying will save you money – but do consider all the factors presented and make the best decision for you!
Tax benefits are another reason to consider buying. While tax laws do fluctuate, one thing that remains consistent is there are far more tax benefits as a homeowner. There’s just no getting around that fact, no matter how many changes there are to the tax laws. There’s also no getting around the fact that you will be paying property taxes, so make sure to do the math before you buy and consult with your accountant and mortgage lender to learn what’s right for you.
Another benefit of owning a home is that you can renovate the home according to your own taste, not the landlord. The good news for renters is, landlords are seeing the benefit of keeping their residents happy for the long term and are often willing to accommodate smaller requests like painting a wall or installing a ceiling fan. But when it comes to the larger projects like tearing out a kitchen or installing a new pedestal sink and a garden-style soaking tub in the bathroom, chances are your request may be denied.
Whether you choose to rent or buy, it’s important to consider the quality of your life, overall. If you want to buy, but that means you have to live in a neighborhood that doesn’t suit your lifestyle and you have to commute two hours to work, then the quality of your daily life will be compromised. In that case, it might be better to rent. But if you enjoy binge-watching home repair shows and can’t wait to knock down some walls and create your own space, it might be time to call a real estate agent. Either way, you have plenty of options when the pursuit of happiness is your guide.
-The Weidner Team