Renting Or Buying A Home - Advantages and Disadvantages

By Tara Millar

Although owning a home sometimes makes sense financially, at certain times in their lives some folks are better off renting. Here are some benefits:

Simplicity: Locating a house to buy will be terribly stressful and time consuming whereas searching for a rental property that matches your state of affairs will be done in a matter of days in most cases. When buying a house, getting financing together, scheduling inspections, and dealing with issue upon issue will be wearisome. Renters never need to face these circumstances.

Convenience: You can rest simply knowing that when an appliance breaks down, it's your landlords responsibility to procure repairs or replacement. If the plumbing backs up, heater breaks within the wintertime, roof leaks, or whatever the case could be - all it most of the time takes could be a phone call to the owner and presto, your problem is resolved with nothing out of your pocket.

Flexibility: If you ever get uninterested in the house or apartment you're in or you would like a larger place with additional amenities, then just wait a little while and when your lease is up you'll be able to say bye, bye to that place. Wanting to leave a home that you simply own would need you to house the hassle of finding somebody to rent it or putting it on the market.

Increased liquidity: Coughing up the down payment and closing prices will typically empty most individual's financial reserves, unless you got a high-paying job or happen to come into a massive sum of money. For many, coming up with these funds will very well break you financially. Additionally, buying a home suggests that you should fulfill your monthly mortgage, pay property taxes, insurance and repair costs. Maintenance fees and other expenses should be considered. When you rent, you're in a position to use your extra money for other things such as traveling or making payments on a brand new car. You are additionally able to budget easier since you don't have those surprise repairs bills.

Diversification: Most homeowners who are struggling financially have the bulk of their wealth occupied in their homes. You, as a renter, are free to invest your cash in varied investments like stocks and bonds. You'll even choose to begin a small business. You can even purchase real estate rental properties to add to your portfolio.

Chance of lower cost: You'll very well live in an area where home costs have skyrocketed and surpassed rental rates. Real estate may not be a smart get at the time. Well, renting would be the better option in those cases.

Especially if you're expecting to move soon, renting should be cheaper since buying and selling property takes abundant money in most cases. Real estate agent fees, loan fees, inspections, title insurance, and a host of different prices add up terribly quickly. Your property would then have to appreciate by roughly 15% just for you to recover these costs. Buying a property that you don't plan to hold onto for 3-5 years wouldn't be the means to go. - 32183

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