Should I Rent Or Should I Buy?
No matter the situation; whether you are a young adult ready to buy his/her first home, but you are uncertain or you just want to finally have a place to call your own - the same big question lingers in your mind... Should I rent or should I buy?
Here are some things to keep in mind when answering that difficult question.
You should rent if...
You do not plan on staying in the same place for less than five years.
Are you on a job post that is only going to last a few years? Are you in a new city and not sure you are going to stay? Do you plan on starting a family soon (which will require a little more room)? If you answered "yes" to any of these questions, renting may be a good option for you. Constantly paying high transaction costs can potentially lose you a lot of money.
You are uncertain about employment.
No one wants to be living paycheck to paycheck or worry about keeping a job they have. Being in this situation, you should be more worried about building up an emergency fund and saving money.
You have limited funds.
The statement reads true. If you do not have enough for a 20% down payment and/or cannot cover the costs of actually owning a home, renting will be the best bet for you.
You should buy if...
You plan on staying in the same place for five or more years.
You can restore what you paid for and possibly develop a return on your investment. It is also cheaper, in the long run, to buy a house than rent a place long term. It is also nice to have a place to call your own that you can do as you please with it. You could possibly make a profit if and when you sell your home.
You have a secured job.
Job security is a great feeling to have, especially when owning a home. You have a steady income to be able to pay a mortgage on time and be able to keep the home for a long time.
You have sufficient funds.
Having sufficient funds means you can cover whatever additional home costs come your way. You will be able to cover the down payment, closing costs, commissions and maintenance costs.
If you are still not sure whether you should rent or buy, click here to try the "Buy or Rent" calculator to see which is best for you.
