Rent vs. Own

There are advantages and disadvantages to both renting and buying a home. Evaluate what your needs are before you make the decision to buy.

Renting can be cost efficient if you plan on staying in a location for a short time. Renting also has perks when it comes to maintenance. Usually an apartment complex or landlord will make all necessary repairs and maintain the property. This covers the interior of the apartment as well as the exterior and landscaping. Rentals are normally easier to find and obtain than homes for sale. Relocation is also easier when renting, since you don’t have to sell your house before you move. Renting may require a deposit and fees but they are normally cheaper then the cost of purchasing a home. Monthly rent payments may also be lower than mortgage payments.

Renting also has some disadvantages as well. The renter will not earn any of the equity in the property. No matter how long the renter is in the property, they will never own any of the property. Some apartment complexes and landlords have strict rules that the renter must live by, including no alterations to the property (such as painting, new carpet, etc.) There are also no tax breaks for renters.

On the other hand, owning a home has many advantages. If the property value increases, the equity is yours. You can even borrow this money in a home equity loan. Having and paying a mortgage loan accurately and on time will help increase your credit score. Since the property is owned by you, you can alter and change what you please, as long as it fits with homeowners associations if applicable. There are also tax breaks offered by the government for home owners.

Disadvantages of owning range from being responsible for all repairs and maintenance to losing money if the property value decreases. Because you own the home, it is not as easy to move because you must sell or rent out the home. The mortgage loan is a contract that must be paid back, and if it is not paid back as scheduled, your credit will be severely damaged. Additional costs include: down payment, closing costs and costs to purchase or sell the home.