People are faced with two options when it comes to home sweet home: buying or renting. For some the choice is easy: they can either afford to purchase a property or they can’t so they choose to rent instead. However, in some cases people are on the cusp of either signing a new long-term lease or making a down payment on a home and beginning to pay a mortgage. What are the pros and cons to each decision? Read on so you can make an informed decision about something that will have a massive impact on your future (no pressure)!
Pros to Buying Your Own Property:
-
You get to start building up good credit by making monthly mortgage payments.
-
You are investing in something long-term that one day you can sell to get your money back (plus more, potentially). You have an asset.
-
When you own your property you can paint, renovate, and re-design things however you like.
-
You will know exactly what your payments each month will be and you are in control of what happens and how long you stay.
- You could choose to rent the property one day to earn extra income.
Cons to Buying Your Own Property:
-
It is a long term investment so you need to be absolutely positive it is the property for you.
-
There is a potential for you to loose a significant amount of money if you can’t pay off your mortgage or if, when you do decide to sell your property, the value has decreased significantly.
-
You are 100% responsible for any damage to it or for anything that breaks down
-
Upkeep of a property you own is much more complicated than maintaining a rental suite you live in.
Pros to Renting A Property:
-
You are only tied down to the property for as long as you choose to sign a lease for.
-
If anything breaks down that is not because of you, the landlord is responsible for fixing it.
-
Rent is typically more affordable than paying a down deposit and monthly mortgage on a home/
-
You can negotiate prices and terms of a lease depending on the market conditions.
Cons to Renting a Property:
-
You are not building up any equity.
-
You could be evicted if you break contract and will be held responsible for funds left to pay or expenses incurred.
-
You typically are not allowed to renovate as you wish. You need to have your landlords permission to make any major or minor changes.
-
Increases the number of years until you could have a paid-off property.
This decision to rent or buy is an important one so choose wisely!
(Photo via Canva)