Weigh the pros and cons of renting and home ownership to decide which is better in your situation.
There is a point in every person’s life when it is time to consider purchasing a house. Renting can be advantageous, as can be home ownership. One has to weigh the pros and cons of each to decide which is better in each situation.
First, you must understand that home ownership is much more than freedom to have wild parties without being evicted. There are many responsibilities attached to owning a home. The first of those responsibilities are costs. Instead of rent, you will have to pay your mortgage, and pay it on time. Paying your mortgage late will have lasting effects on your credit report. Next, you will need to pay property taxes, which may be included in your mortgage payment to make your life simpler. Homeowners insurance and mortgage insurance will also be tacked onto your mortgage payment.
You will have to pay utilities that you did not pay when you were renting. Some of these utilities are water, sewer, and garbage removal. If you did not have to pay for gas and electricity when you were renting, you now be responsible for them as a homeowner. You must also put into your budget, money to maintain your home. If something breaks or shows wear, you will not be able to call the property owner to fix it. Not maintaining your home will lower your property value.
These extra costs do not have to deter a buyer from purchasing a home. Instead, it should show you how to budget for it, and urge you to make sure your mortgage payment is less than your rent was, no matter how tempting it may be to upgrade your standard of living.
As a renter, you also have major responsibilities. As the home is not yours, you have to answer to the owner for any changes you make in the property as well as how you use the property. The Landlord may forbid you to run a business from the home, he may forbid parties and pets. Other responsibilities of renters are paying the rent on time, keeping the home neat and clean, possible lawn care and snow removal, and giving ample notice in advance of moving.
Pride of home ownership is probably the first and most important reward of owning your own home. Chances are you will make a financial profit when you sell your home, if you occupy it for at least a few years. You are able to have pets, and to make changes in the home as you please. Some of the costs of your home are tax deductible. In addition, your mortgage payment will stay the same year to year in most cases, instead of paying a higher rent every year.
At the same time, there are many positive aspects to renting. The first is that your monthly living costs are predictable. Should anything break or need repair, it is not your responsibility to take care of it. You are free to have a transient lifestyle. When you own a home, it will be difficult to decide to spend a year in another state or country. When you rent, all you need to do is give your property owner notice, and move on.
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