Should you Rent or Buy your Next Home?

The decision to rent or buy your next home isn’t always an easy one. On one hand, renting means you have flexibility. You can leave when your lease is up and move anywhere you like. If you enjoy the place, you can talk to the landlord about renewing the lease. You also don’t have to take care of major repairs or replacing appliances either as that is their responsibility.

Yet when you buy your home, you are building up equity in it. Each month that money goes towards something you own and you get ongoing value from. With rent, you pay for the use of the property but then it is gone. You can also fix up your home anyway you want when you own it. This includes painting and decorating, whereas you are limited with such options when you rent.

What can you Afford?

When you evaluate your budget, you may discover you can’t afford to buy your own home right now. You may not have good enough credit or enough money saved up for the deposit and the associated costs involved with the purchase. Perhaps you can’t buy the type of house you want on your budget, so you are going to rent for now and buy in the future when your situation improves financially. If you are uncertain you would like to live in a given area for an extended period of time, don’t buy. You don’t want to feel pressure to sell the property because you’d rather relocate. However, if you plan to stay in the area for many years, it is better to buy than to rent. Then you can sell it for a profit at a later date.