Is it Better to Rent or Own a Home?

It can be really difficult to know whether it is better to buy or rent a home. There are advantages and disadvantages to both and it is good to be aware of them so that you can decide which will be right for you. Some people may be in the situation where renting will benefit them more and others where buying will benefit them more.

Cost of Rent/Mortgage

The cost of both renting and mortgaging are often determined by the interest rate generally. Obviously, some areas will be cheaper than others due to desirability and the size of the houses will change the cost too, but this will be the same with renting and mortgaging. It is easy to assume that the interest rate will only impact the cost of the mortgage. However, many property owners are paying mortgages too and so if interest rates go up they will put rents up to cover that increase. However, when interest rates are really low, this perhaps will not make much of a difference. As property owners tend to be covering a mortgage as well as costs of maintaining the house you are renting, you may find that renting is actually more expensive than paying a mortgage. You also need to consider that once you have paid off your mortgage you will no longer have to make payments, but you will always have to make rental payments. So, if you can get a mortgage, then it could be worth investigating the costs to see whether it is worth you considering switching over.

Cost of Repairs/Maintenance

When you own a house the cost of any repairs is down to you to pay for. This is also true of any decorating that needs doing as well. The cost of this will vary depending on what state of repair your home is in. If you rent a house, the landlord will pay for these things. This means that you will not need to worry about the cost, but it could mean that repairs are not done very quickly or are not done at all.

Flexibility to Move

If you own a house, then you will be tied down. If you want to move to a different part of the country or to a different country you will need to sell the house before you can move or alternatively, rent it out and rent something yourself. It is much easier to be flexible when you are renting as you can hand in your notice and move within a few months normally.

Flexibility to Change Home

If you are renting a home you cannot make big changes to it. It is likely that you will need to paint it in neutral colours and will not be able to change anything or update anything. If you do any of these things you may have to pay for them yourself or get your landlords permission. If you own a home, you will be able to make changes. You will be able to do what you wish with your home and extend it, convert rooms, update it and paint whatever colour you like. You might like the idea of having this flexibility.

It is important to think about what you think will work best for you. Consider the pros and cons and what you think might suit you. It might be that it is better to start off renting and then settle down once you have a family and need to be near a good school or to your work. There is a lot to think about as buying a house is a big commitment but it can also be very rewarding.

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