Home ownership is one of those things that seems to be lodged in the national psyche as ‘a good thing’. It’s a sign that you have made it, after all, and that you are on the road to independence. But is it always a good thing? Perhaps not.
There are plenty of reasons why renting makes more sense than buying a home – and they are all dependent on your personal situation. In this guide, we’re going to outline several of these reasons and give all you renters out there a brief moment of respite.
It’s better if you are moving on
Of course, you could say that you are just throwing your money away by renting, but is this really true? If you are planning on moving in a few years time, it almost always pays better to rent. Depending on your home loan terms, it could be six years before buying turns a profit over paying a landlord.
It’s cheaper in some cities
In certain areas of the country, it’s cheaper to rent than to buy. So, you could be looking at classy, luxury rental apartments instead of a dilapidated building that you need to do up before enjoying. When you rent, you can expect a high level of decor, and everything ready for you on day one.
You aren’t responsible for facilities
When you rent, if something goes wrong, you call your landlord. If they don’t do anything about it, you can take them to court. If you own your home, you are responsible for everything. When the boiler breaks down, you have to pay a fortune to fix it. If there are structural issues, you have to fit the bill. Sure, you own the property and might pay less than a rental equivalent. But, there are added expenses that no one ever seems to account for when they think about the costs of paying for their home.
You invest your money in better areas
All property is an investment, whether you are a single finance expert, or you want to raise your family there. And, all investments are gambles – no matter how safe it appears at first. Who knows when the next property bubble is going burst? If the value of you home crashes, it could leave you in a sticky situation. There are safer investment opportunities out there – and many that can give a higher than average return.
The returns aren’t always as great as they seem
Of course, there is a big payoff when the time comes to sell a home. And, in general, terms, the longer you have owned it, the better they will be. But, when you hear about people making tens of thousands of dollars from the sale of their home, you don’t hear about everything else. You don’t hear them mention the enormous deposit they put down in the first place. Or, you don’t hear about the astonishing array of fees they had to pay before they bought – and all the maintenance they have paid for. Finally, of course, there’s the cost of the home they are moving to bear in mind. Sure, they might make a handsome profit – but it might not be all they make it out to be.