You have a lot to think about when you’re considering whether to buy or rent your home, and which is the better deal for you.
Questions you should ask yourself when considering renting vs. owning a home:
- How long do I plan to live in this location?
- Do I want to take on household maintenance costs myself?
- What sort of down payment do I have saved up if I wanted to buy a house?
- What are mortgage rates right now, and would I qualify for a loan?
- What is the average rent for the area I want to live in?
- Does the rental unit I can afford have enough space to hold all my belongings, or do I need to also rent a storage unit?
- If I purchased, what are the taxes, association fees or other payments I might need to make, in addition to the mortgage payment?
- What is the history of rent increases for the unit I’m interested in renting?
- How much would I be paying for home insurance versus renter’s insurance?
- Are housing prices increasing in the area you’re interested in living?
In many cases, for the short term, renting is the better deal financially because costs like taxes, fees, maintenance and insurance can add up. However, those interested in living in an area for a long time might discover that in the long run, homeownership is the better option. This is because as you pay off a mortgage loan, you earn equity.
You will need to do a lot of research to determine financially what the best deal is for you and your family. In the long run though, many people make the decision based on their lifestyle and if they want to live in an apartment or a private home.