Looking for a new home in the near future? Are you contemplating renting or are you contemplating buying? There are several reasons to choose to rent and several reasons to choose to buy a house, but today I’m going to show you the pros and cons of renting a home vs owning a home.
Stability vs Flexibility
Homeownership offers a variety of benefits, one of which is stability. Owning a home creates a sense of community and stability. Raising a family is much easier in a home owned by a happy couple versus living under the conditions of a landlord.
Renting offers a higher degree of flexibility than homeownership. A tenant can live in one city in one part of the country one year, then move to a different city in a different part of the country next year.
Renting is often referred to as “wasting money,” but everyone needs a place to live. Whether you own a home or rent a house, everyone needs a place to live, eat, and sleep. On the other hand, paying down your mortgage on a home year after year increases equity on the property.
Homeownership does, however, have its downsides. Owning a home costs more than renting a home. There are costs that you don’t have to pay as a renter such as:
- property taxes
- trash pickup
- water and sewer service
- repairs and maintenance
- pest control
- tree trimming
- homeowners insurance
- pool cleaning (if you have one)
- lender-required flood insurance, in some areas
- earthquake insurance, in some areas
- mortgage interest
Monthly mortgage payments are predictable. Month after month mortgage, insurance, and repairs are predictable and stable. You’ll never have to replace a roof as a tenant though.
Renters face unpredictable rent increases once leases expire. As demand for living spaces in popular areas increase, so does rent. Monthly houses payments don’t increase with fixed-rate mortgages.
Other Homeownership Myths
Owning a home year after year does not guarantee an increase in value. If businesses in the area fail and unemployment rises, the value of homes in the surrounding areas fall. If the local economy is doing very well, the value of homes also increase.
Homeowners do get a tax deduction when purchasing a home however that shouldn’t be the sole reason to purchase a home. Tax deductions are simply a great way to reduce out-of-pocket expenses.
Renting works better for those who heavily value their time. There is no need to maintain a home while renting although maintenance and repairs may not be done as quickly as you’d like.
Homeowners must always keep in mind repairs and maintenance. Homeowners do have the choice to hire a third-party to complete any projects, repairs, or upkeep necessary to keep the home in great shape.
The best decision isn’t always about money; it’s about what best suits your lifestyle. Take the information given to you in order to make a logical decision on your living space. Housing markets and life circumstances vary, day by day, so be sure to reach out to a professional for more targeted advice.
The decision to rent or buy is very much financial as it is emotional. Many people take on the extra chores of owning a home despite the added expenses compared to renting. Ultimately, the decision is yours.
For more information on Maryland Real Estate be sure to visit Carlos.thinknewman.com for FREE access to live, up to date information on homes in your area. Message Carlos Jonathan on Facebook, Twitter, Instagram or call 301-785-1946 for your FREE consultation.