Beginning to grow weary of renting but not quite convinced that buying a home is the best financial decision? This is often the thought that goes through many of our minds before deciding to take the leap. Alongside trying to search for a place to call home, deciding on whether buying or renting is the best option for you can make your hunt more stressful. Here are some of the big things to consider before you decide on renting or buying:
When to consider renting
- You’re a constant mover: If you are someone who is constantly on the move or aren’t quite sure the area you live in is one you want to commit to, then renting would be a better option for you. This way, you have more flexibility and aren’t tied down to one property long term.
- You don’t have the most stable employment: Not having job stability can really put a damper on the home buying process. You need to ensure you have enough to cover the costs of living, and most importantly, your mortgage.
- If you’re not open to home maintenance: Owning a home comes with many more responsibilities. If something goes wrong, you have to fix it on your own or hire a professional. No more calling the landlord to resolve sticky issues!
- You have an unsatisfactory credit score: While renting, you can take your time to improve your credit score so when you are ready to buy – approval is more likely.
When to consider buying
- When buying actually saves you money: Yes, there are some cases where buying can actually save you money. Utilize online mortgage calculators to determine if your monthly mortgage may be less than your monthly rent. Also take into consideration that when you own a home, you are building equity. Even if your mortgage is more, you may gain significant square footage, amenities and features you previously didn’t have access to when renting – which carries its own value.
- You’re ready to commit to one location: You have a secure job, relationship, and you know the exact location you want to live in. It never hurts to watch the homes on the market when you are confident in settling in the location that makes you most happy.
- You have an emergency savings: Having a nest egg to rely on makes a huge difference when you become ready to purchase a home. Sometimes what you see in the walkthrough isn’t always the reality of what you’re getting yourself into with a property. Having an emergency savings ensures that when the time comes to replace and/or repair something, you’ll be ready.
- You’re passionate about having the freedom to decorate/customize your living space: Everyone wants to make their place feel like a home, but sometimes that’s hard to do while renting because the rental property may set limitations on paint colors, wall hangings, fixtures and more. When you own your home, you have the freedom to do what makes you happy in your living space. From knocking down walls to painting a mural – the choice is yours!
Overall, there are many items to consider between renting and buying. Our best advice is to take your time weighing the pros and cons of each. Then begin to investigate which one would work best for you and what would be the best financial decision overall.