Renting vs Buying: How To Decide For Yourself With These 6 Factors
By: Ian Golightly MBA, Realtor
Data from the U.S. Census Bureau shows that median rent continues to rise. When there’s an opportunity for low mortgage rates, it is an excellent time for renters to make a move to be homeowners! Everyone’s timeline to purchase a home is different from everyone else, but every year this question always gets asked: Should I rent, or is it time to buy a home? Truthfully, it depends on your current situation what are your future plans. Here some thoughts that will help guide you to decide if you’re ready to own a home.
Rent will continue to rise:
Renters continue to move from place to place because, in most cases, rent will continue to increase each year. The graph below is an excellent way of how rent has grown throughout the years. In most cases, the significant part of owning a home is that you lock in a monthly payment for a very long time, which creates consistency and peace of mind in your expenses.
Freedom in what you do:
When you rent, you are limited to the things that you can do. Many people prefer to have the ability to renovate, paint, and make home upgrades without asking for permission. In most cases, landlords make these decisions for you as a renter. As a homeowner, you have the option to personalize your home by making it your own.
Privacy Privacy Privacy:
I couldn’t have repeated it again but, PRIVACY! When you’re renting, your landlord has access to your place when an emergency occurs. As a homeowner, you get to decide who comes into your home. Given the concerns with the pandemic and privacy, this may be an increasing priority for you.
Flexibility For Relocation:
One of the best things about renting is moving quickly if you had to transfer for a job or decide it’s time to live somewhere different. On the other hand, if you are a homeowner and need to sell your home, it may take a little more time. Depending on your location, if the housing market has a low inventory and the demand for housing is high, you have the chances of selling your home quicker and for a higher price than expected.
Each time you pay your rent, your landlord earns the equity, the property gains over time. If you own your home, the benefits of your investment will go directly toward your net worth. You’ll be able to use this ‘savings’ for the future for things like sending your children to college, buying a bigger home, starting a new business, or later on to downsize and use the profits for retirement.
As a homeowner, there are additional advantages that work in your favor. For example, you may be able to deduct things like your property taxes and mortgage interest. I recommend that you speak with your accountant or your local CPA to see what tax benefits apply to your situation. If you are renting, most likely, your landlord is collecting those tax benefits.
The bottom line is that it’s up to you if you prefer to buy or rent because every person is different. If you want to learn more about your options, contact us. You’ll be given enough information to make an informed, confident decision.