Should I Rent or Buy a Home?
Choosing whether to rent or buy a home is a big decision. You likely will be deciding where you children will be going to school for their formative years, where you will be working, and where you want to call home. Choosing between renting and owning is just as big of a decision, and there are some basic questions to ask before making a final decisions.
Money is the Answer, What is the Question?
For most people, the issue of weighing out the financial advantages between renting and owning is the most important consideration. In making this part of the decision, you should not spend a lot of time going over the details. You should have enough room in your monthly budget to allow for unexpected expenses whether you are renting or buying.
Here are some of the major expenses you will avoid by not buying:
- Taxes – includes property, HOA, and interest on the mortgage
- Insurance – property, fire, flood, and personality liability among other types
- Maintenance – everything from replacing your HVAC or heating system to lawn care and fixing the fence
- Utilities – electric, water, gas, and cable
On the other side of the coin, you will lose any control of some or all of these responsibilities, which means if something goes wrong with the water or heating system, the owner/landlord will have to be the one to repair the problem. Before making a decision, be sure to find out what the state of your heating and plumbing system are and if there are any changes planned.
You need to decide on how long you plan to live in the home. The longer you expect to stay, the more you will lean towards buying over renting. No matter how new the home is, you will eventually want to change things, whether it is the color of the walls or remodeling the kitchen. Most renters have very little say-so over repairs and remodeling the home, and as an owner money spent on home improvement can be deducted as a homeowner’s expense.
If you have young children you may want to consider staying put, at least through their K-8 years. Your children will make new friends and want to develop school and recreational relationships that will be difficult to leave. A sense of stability is important to your children
The average morning commute in the United States is 45 minutes. If you are moving to be closer to your job – and many Americans do – owning can be the best option. But if there are new housing developments closer to your job, or if you expect to getting a job in another location within the next few years, renting is the way to go.
You may be wondering how important this is given that many people change their jobs several times during their working years. Again, it is all about the commute. If you are considering moving to an area that has great transportation links (major arteries, bus, train, or other forms of work transportation) then ownership may be your best option. The closer you are to your place of work, the easier your life will be because you will spend less on gas or other transportation expenses, you will have a less stressful lifestyle, and you will have more time to enjoy your home.
Should I Rent or Buy a Home
There are 1000’s websites that will bury you in details about every nuance when it comes to renting versus buying a home. But the three major considerations – money, length of stay and job location – are the three most likely to impact your decision over the long term. Buying a home is a long term responsibility, so if there is any doubt whether you will have enough money or stay put for more than 5 years, renting may be your best choice. Whatever decision you make, it will very likely be better than renting an apartment.