To rent or buy? That is the question. Deciding whether to rent or buy your next home or apartment is a major financial decision that can have a lasting impact on your financial wellness and wealth management. Buying is not always the right decision, even though it may be touted as the better option. There are plenty of reasons why renting may be a smarter decision. Here are a few great reasons to rent instead of buying property.
When You’re in a Place Temporarily
If you know that you will only be living in a particular city or neighborhood for a temporary period before moving again, then it is probably best to rent instead of buying. Unless you are planning on living somewhere for five years or longer, buying is too big of a commitment to make to a property. Home ownership is costly, it involves down payments, mortgages, property taxes, homeowners’ association fees, and maintenance. And then, when you decide to move and sell, you may be stuck with a home on the market for a long time, which costs lots of money. If you are somewhere temporarily, you should stick to renting.
When You Don’t Want to Deal with Maintenance
Owning a house means owning its problems. And houses come with a lot of problems. Maintenance and repairs will be your responsibility, and your responsibility exclusively. This means time and money spent keeping your home livable if you own it. When you rent, those problems are your landlords, not yours. By renting, you don’t have to worry about property management. If a maintenance or repair issue crops up, then all you must do as a tenant is inform your landlord and they are required to handle it in a timely manner. This can save you time and money if you don’t have the time or effort to keep up with maintenance.
If You Don’t Want to Take on Debt
Owning and buying a home, unless you are a millionaire or richer, is going to mean taking on a large amount of debt. That is what a mortgage is, borrowing money from the bank, that you then must pay a payment on every month. This means that you will be taking on a few hundred thousand dollars in debt, or more. While debt is not always a bad thing, in certain situations you don’t want to take on debt, even if it is leveraged to increase your wealth. When you are trying to avoid debt, renting is your better option.
Renting versus buying has long been the debate on how to live. But there are reasons why you would choose either route. If any of these three reasons hit home with you, then it may be in your best interest to rent rather than buy.
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