Factors to Consider When Buying or Renting Real Estate
Home buyers have the option of choosing between buying and renting. You can decide whether it makes financial sense to continue paying monthly rent to a landlord or to take up a mortgage to finance the buying of a home depending on your financial stability and consistency.
Unfortunately, most of the decisions made by most homeowners are based on emotions. The decisions are often predicated on the desire to start a family or the fear of a significant financial commitment. The following are some of the factors to consider when buying or renting a home, including:
· Personal finances
It is important to consider how much money you have at your disposal and how much you can get from other sources. It is equally important to determine how much debt you owe, your credit score and your taxes.
If your credit score is poor, you may need to seek professional help to improve it before moving ahead with buying your first home. If you have a good credit score, you stand to benefit from a low fixed rate mortgage. This will help you get your dream home at competitive prices.
The site of a property is a very important factor in real estate because it often impacts the price and value of the property an individual is considering renting or purchasing. The location has to do with the geographic location, such as the city, rural towns, and metro areas.
When you consult the right professional, he/she will be able to advise the impact of renting or buying based on the finances that you have and the geographic location. You could end up saving a substantial amount of money every month when you buy a home in some cities, instead of renting.
The decision to buy or rent a home is also dependent on an individual’s short-term plans- the changes to one’s lifestyle and how the lifestyle fits their career goals and life. If you are young, unmarried and are uncertain about living in the place you currently live, you may consider renting and saving over the short-term before you decide to buy a home.
The real estate quandary has been around forever and the answer can fluctuate, depending on the economic circumstances. Is it better to buy a house or to be a renter?
The advantages of buying a house include saving money on taxes, a forced savings account, pride of ownership, and being a part of the classic American dream. There are substantial tax write-offs for ownership that help many to reduce their annual tax debt. Paying a mortgage each month is usually the top of the list for most people. It is often the last thing that they would let slide. Even if the prices aren’t going up as quickly as they were in the past, the money paid to the bank goes toward the principal of the residence which is slowly but surely becoming an asset.
Owning a home means that you can paint it whatever color you decide, rip up the carpet on a whim in order to replace it with tile or hardwood, put in a swimming pool or have a backyard full of wildflowers. It’s a place to raise children and to hunker down into on a cold winter’s night. Sure, the real estate prices have been up and down, but there is truly no place like home.
The disadvantages of ownership include lack of flexibility and ongoing maintenance. If there is a need to relocate to another region quickly due to a job transfer, the homeowner will need to sell their house before they can pick up and relocate. There are also maintenance issues to contend with. You will have to take care of emergency plumbing problems or a leaky roof. Or you may have smaller issues that a local handyman can fix. The buck stops with the home-owner and he or she must be prepared.
The advantages of being a renter include flexibility and being able to have the landlord foot the maintenance bills. If frequent moves are a part of a person’s employment scene, it may be wise to rent so that they can easily pull up stakes. Having someone else being responsible for repairs and maintenance can be a relief, as well. It must be noted that landlords may not always comply quickly or the way you’d like them to. You may think the carpet is hideous and needs to be replaced while the landlord thinks it just needs a bit of shampooing.
The disadvantages of renting include fluctuating rent costs and throwing money down the drain. The prices can rise from lease to lease and the person living there has no control. If they can no longer afford the rent, they will have no choice but to find another abode. The rent checks that they may have handed over for years paid for their right to live there, but in the end, they own nothing.