The Housing Game: To Rent or To Buy
Changing from renting a home to buying your own home is probably one of the biggest decisions you’ll make. But, armed with the right facts, it can be much less intimidating. When you’re deciding if buying a home is the right move for you, think about these three things: your finances, your plans for the future, and your lifestyle. After reviewing all 3 you’ll be able to clearly decide whether renting remains your best choice or if buying a home is the right step for you.
Finances: While you don’t need perfect credit or no debt to buy a home, you do need to be able to cover some upfront costs like closing costs, insurance and taxes. You may qualify for programs to help you cover closing costs and make your down payments. Your loan specialist will be able to assist you in finding the right programs for your situation. Renting may be a good short-term solution for your finances but when you consider long term planning it is important to remember that you can anticipate your mortgage payment. Rent fluctuates with the market and over time it will likely cost much less to buy than to rent. There are now lots of helpful websites that can help you compare potential renting and buying costs, both up front and over the long term. You can find one of the best on The New York Times Website.
Planning for the Future: One of the major drawbacks of renting your is the lack of stability. With an average yearly increase of 3.5% (and much higher in some areas), you’ll be asked to pay more for the same place every time you renew your lease. If it increases too much or the building management decide to sell the apartments, you may be forced to leave. You also have no control over renovations in your building, which can cause major inconveniences. Owning your home means leaving unfortunate surprises like that behind. After the up-front cost, not only will you know exactly what you owe on your mortgage, over time you most likely spend less money than you would have by renting… PLUS, you’ll own your home and all of its equality!
Lifestyle: This comes down entirely to personal preference. If you rent your home, lots of important decisions about how your home looks and feels are not up to you. Many landlords will refuse to let tenants paint, let alone renovate their space. Being able to truly personalize and customize your living space to fit your ideal lifestyle is one of the best reasons to buy your own home.
And while customizing your home may seem incredible appealing, the idea of the maintenance associated with homeowner may feel a bit daunting. Afterall if you have a problem in a rental, you can just call your landlord to fix it. However, while your landlord takes on the task of maintenance, they also enjoy all the benefits of owning property. Why not take these benefits for yourself by purchasing a low maintenance condo or townhome that is similar to the size of your ideal rental? It will likely cost you less per month than the renting a similarly sized apartment and you can always buy a larger place when you need.
In the end, there’s no one answer to whether you should rent or buy, it entirely depends on your current lifestyle and your plans for the future. But not buying a home because you’re intimidated by the process is not a good enough reason. With the help of a good realtor and a trusted mortgage company who can provide a loan solution, moving into your first home can be as easy as answering this question: Am I ready to live my American Dream?