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Should you rent or buy a house? Here’s a comparison…

Should you rent or buy a house? Here’s a comparison…

Should you rent or buy a house?

Renting or buying a home is among the most critical financial decisions. For many, owning a home is a lifetime fulfillment. Based on financial position, your plans, and personal preferences, below are the pros and cons to help you make this important decision.

Renting a House

A good number of people these days are ruling out home ownership because it simply doesn’t make sense to them.

The Pros

  • Renting cost is lower per month/year as compared to buying a mortgage, which exerts more pressure and responsibility on your income.
  • You can choose from a variety of apartments, condos, townhomes and single family homes, depending on your financial capacity, and your rent fee often covers all costs associated with the home.
  • You are more able to change homes easily since most leases will run for one year. If your job or family requires relocation, renting would be a suitable alternative.
  • Your property owner will be responsible for carrying out nearly all the repair work and general maintenance.

The Cons

  • You will not enjoy tax breaks, and you cannot claim tax deduction on mortgage interest
  • Your renting costs aren’t fixed and may change from year to year
  • Minimal security and privacy

Home Ownership

For many, home ownership sounds like the best thing in life. However, taking a keen check, it has its own pros and cons too.

Pros

  • Home ownership provides a greater sense of security and privacy
  • Home values typically appreciate, build equity, and provide security for the future
  • Mortgage costs are more stable and predictable since they are often based on fixed-rate terms
  • Homeowners enjoy tax breaks and deductions on mortgage interests

Cons

  • Home ownership subjects you to a long-term financial commitment
  • You’re responsible for all maintenance work, including repairs on the heating system and plumbing among others
  • Owning a house ties you to one neighborhood and it’s not easy to relocate
  • Although mortgage payments are usually fixed, they’re generally higher than rent payments and include other fees like property taxes, homeowners insurance and homeowner association fees
  • Borrowing against your house can be tempting and might leave you financially insecure

Buying a home is a major investment.  For the savvy woman, we recommend weighing all the options before making the decision!

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