Pro's and Con's of Buying vs. Renting
reprinted courtesy of Our Family Place
If you are considering buying a house, one of the first decisions you need to make is whether buying a house instead of renting one is the right direction for you. Since owning a home is the "American Dream", many people simply assume that it's always to their advantage to buy a home, and for most, it is. Take a moment to review the following lists to see how your situation fits in.
Renting
* More fixed costs for the term of the lease
* Not gaining equity, but not losing it either
* When the lease is up, you can just move
* There is generally less work in maintaining a home or apartment
* Smaller amount of "up-front" cash
* No matter what happens with the value of the home, you will never gain equity
* Limited - or no - ability to personalize your living quarters
* No tax advantage to renting. Your landlord gets any and all tax breaks that are available
Buying
* Variable costs
* Equity may go up, down, or stay stagnant
* If you want to move, home generally must be sold
* Work needs to be done by you - or paid for by you
* Generally a larger initial investment - the downpayment
* Over time, the mortgage balance decreases and equity builds, even if the value of the home does not increase
* The ability to remodel and redecorate the home to match your needs and desires
* There can be tax advantages attached to home ownership. Consult competant legal and/or accounting advice for details for your situation
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