Deciding whether to buy or rent a place can be a tough decision, especially when moving to a new place. For many people living arrangements are some of their biggest expenses. Renting or buying comes down to whether you value flexibility or certainty. Buying a home is an investment that comes with fixed mortgage payments, control over the property and other hidden costs. Renting, on the other hand, is more flexible and typically affordable. Renters can get more savings but they have no control over the property.
- How long will you stay there?
Buying and selling one house after the other can be costly. From real estate agent fees to paying the movers, homeowners can easily lose money racking up unnecessary expenses. To recover the cost of buying a house you need to stay there for a while. If you do not plan on leaving soon you can buy the place. However, if you are not planning on staying long or if you are retiring soon; renting is a better choice. Also, if you are moving to a new place, rent a place first so you can take your time to decide whether you like the place or not. You will also have enough time to compare mortgage options using tools like habito.
- Is the house you are getting suited for elderly living?
If your home is not suitable for elderly persons, you need to factor in the added cost of the renovations that might be needed later on. For example, adding ramps to help senior citizens get up stairways. Most rentals are better suited for elderly persons with lifts and ramps for easy access. If you plan on growing old in the house, then this should be a priority now. However, you can also do these renovations later, especially if you are still young because preference may change.
- How flexible is your budget?
While renting give greater flexibility it is not risk-free. Landlords can choose to raise the rent or sell the place, forcing you to move. For retirees on a fixed income, raising rent can be a hassle. And if it increases it can affect your standard of living. If you own a home, you do not have to worry about this. However, if you have more equity than savings then the extra cash can come in handy. Also, if renting is cheaper than owning a place in your market, you will get an extra cash boost. Property taxes can be quite high in some areas making renting cheaper than servicing a mortgage. Be sure to compare both options and decide which one suits you best.
Renting or buying have their pros and cons. Non-economic variables of a location such as closeness to family, climate, and recreation activities play a large part in what makes us happy. These variables cannot be overlooked and can complicate a rent-or-buy decision. With these few pointers in mind, remember to trust your gut when deciding whether to buy or rent.