Pros and Cons of Renting vs. Buying a New Home
Published: July 23, 2018
If you’re currently grappling with whether it’s time to buy a home or continue renting, it can be helpful to review some of the pros and cons of each before making a decision.
Renting a Home
Renting a home, apartment, or other forms of residence comes with very little commitment. Aside from the lease term you agreed upon, there isn’t much holding you down.
When you rent, you’re not generally responsible for much in the way of maintenance. If the dishwasher in your apartment stops working, for example, your landlord will likely repair or replace it at no cost to you. Talk about convenience and peace of mind!
Of course, when you rent, you’re not building any equity. Instead, you’re padding your landlord’s pockets—and you also have very little freedom to decorate or renovate your rental space.
Becoming a Home Owner
When you buy a home, you’re certainly making a much larger commitment than you would if you were renting. You’ll need to not only place a substantial down payment on your home but get approved for financing in the form of a mortgage as well. And of course, most mortgage terms range from 15 to 30 years!
Being a homeowner also means you’ll be responsible for all your maintenance and upkeep—so that broken dishwasher suddenly becomes your financial burden. On the other hand, you’ll also be able to do just about anything else you want to personalize your home inside and out. Nobody (aside from maybe your city’s permit office) can tell you what you can and cannot do with your home.
Last but certainly not least, when you own a home, you’re building equity with each mortgage payment you make. When your home is paid off, you’ll own a huge asset outright—making home ownership a great investment for those who are ready for the commitment.