While renting may seem like an easy and simple solution to this situation, there are actually pros and cons for both options that everyone seeking their own home should be aware of.
One of the most appealing parts of renting a home is the smaller upfront payment you have to cough up. Renters usually have to pay two months’ rent plus the rent for the month they are moving in as well as a utilities fee which is refundable. Another big plus is that there are little to no maintenance costs involved as those are borne by the owner of the property.
As they are not the owner, renters are free from headaches such as having to worry about losing money if the property’s value drops and being responsible for its upkeep and repairs. There is also no long-term commitment involved, so packing up and moving away as and when one sees fit to do so is remarkably easy.
Of course, renting has its downsides as well with the primary one being that rent money is a constant and consistent expense that has to be kept in mind at all times and must be paid indefinitely so long as the renter lives there. Furthermore, the rental rate can be increased depending on market conditions, the economy or even the landlord’s whims.
The landlord has ultimate control of the situation, meaning the renter also faces lifestyle restrictions such as being unable to decorate their home and keep pets. This can be taken a step further; the landlord has the freedom to sell the place at any time or simply ask the renter to move out, lending an air of uncertainty to the renter’s living arrangements.
Aside from the obvious satisfaction that comes with owning a home, there is the fact that this means the new homeowner enjoys so many benefits that renters do not. For example, homeowners have more control over their home’s design, what improvements they would like to make to it, how they can use it and who they can bring over.
Money-wise, a new homeowner’s monthly loan repayment rate can be lower than a renter’s monthly rent payment value depending on the situation. There is also the big advantage of the home serving as a valuable asset where the rise of property prices means an increase of the home’s value and their own wealth as a result.
The choice of buying a home comes with its own share of disadvantages with money being the primary cause for concern. Purchasing a home incurs a much higher initial cost compared to renting as it involves hefty deposit charges and hidden costs. As acquiring a loan is a necessary step in this process, mortgage rates which tend to fluctuate are another factor to worry about.
Owning a home is also a very big responsibility that is not to be taken lightly. Unlike renters, homeowners have to hold themselves accountable for the upkeep and maintenance of their abode. Repairs and maintenance work have to either be paid for or personally handled by the homeowner lest accidents be they minor or catastrophic occur.
Last but not least, if the homeowner decides that they no longer wish to live there, they face the daunting task of having to prepare and plan their moving out of their current home which takes time and effort.