The rent versus buy decision has become an eternal debate attached to the idea of settling down in a home. And, why wouldn’t it be? Emotional logic, financial status, social pressure, personal freedom – these are just a few of the many factors that play a significant role in settling on a definite answer. If you’re one of the many people who is confused about the dynamics involved in this decision, then it’s time to weigh the options involved in this debate and settle on a definitive answer.
ADVANTAGES
Buying a home
- Owning a house provides a higher degree of freedom and control. From making decisions regarding the purchase of additional furniture to renovating the entire house, there are no barriers that stand in your way of modifying your home as you see fit.
- Having a house in your name will undoubtedly play in your favour from a legal standpoint as well. Being your own landlord is quite a novel experience indeed.
- Purchasing a home is a long-term investment, both financially and otherwise. The fact that the value of said property will only appreciate over time is another viable benefit, allowing you to attain a profit on the sale if the situation plays out in your favour.
- Financing the purchase of a house has become easier with the advent of new-age digital lenders. They provide hassle-free ways to avail a housing loan to satisfy your needs of purchasing a domicile.
Renting a home
- Renting a home is a flexible option that takes into account any sudden developments that might happen over time during your period of stay. Anything from a job relocation to any unforeseen family situation can be accommodated without any worries.
- In simple terms, renting a house is way more affordable than purchasing. The situational advantage regarding this should be accounted for – if you want to stay in a good locality but can’t afford to purchase a house at this point, then renting is a better course of action to take.
- There’s less of a headache involved in renting a house. The majority of your responsibility lies in taking care of the existing furniture and fittings in the house. Meanwhile, the homeowner or landlord will initiate any task revolving around renovation or maintenance.
- Renting out a place will allow you to save your funds for any future investment. Anything from a foray into the stock market, the purchase of a new car, or even saving up for a new house – the extra savings will make most of these things possible.
DISADVANTAGES
Buying a home
- Purchasing a house is a massive financial burden. The initial down payment, followed by subsequent EMIs and bond repayments can accumulate for some substantial expenditure.
- Along with these payments, various additional costs need to be considered as well. Insuring your house, paying property tax, and accounting for maintenance costs are some of the many payments that will arise over time.
- While property resale is definitely an option, there’s a chance that – keeping all the additional payments in mind – you might not make a profit on resale. Recession, high interest rates, or a location becoming less appealing for buyers are some negative factors that might affect this resale decision.
- Unlike renting, the purchase of a house is set in stone and restricts the owner’s flexibility. If you have to leave your home for any particular reason, then the headache of having to sell your house and settle any legal matters can take a hefty toll.
Renting a home
- Renting a home basically means that you are bound by the rules of the landlord. This heavily restricts your freedom. Any changes you want to make to the property need to be approved by the landlord.
- Most rental processes involve a third party, like a broker or a rental agent. Thus, the time taken to finalise the deal is needlessly extended – not to mention the fact that these third parties end up taking their own cut as well.
- Being at the mercy of the landlord implies several things, none of which is ideal. It’s up to the landlord to decide the annual hike on the property in question – that is, if they even choose to extend your lease in the first place.
The discussion of either renting or purchasing a house rests on you, and regretting this decision is not an ideal situation to land in. Thus, reading up on these advantages and disadvantages and correlating them with your current situation will help you make an informed decision on the topic at hand.
