Should You Rent Or Should You Buy?
If you’re contemplating a move, but haven’t yet found a place to live, you might automatically think renting is cheaper and easier, or you might think that buying is the best option for your future. Both buying and renting have their upsides and their downsides.
Renting
If you’re young and your current life feels a bit fluid, perhaps renting is the best option. It gives you the flexibility to pick up and move as soon as the lease is up, as opposed to after you sell your house. If you have a roommate or a new live-in relationship, it’s a lot easier to move on from an apartment than a house.
It’s cheaper to move into a rental; you usually have to pay just two to three months rent. If anything breaks, it’s the landlord’s responsibility to fix it. Unfortunately, though, all of your rent money goes into your landlord’s pockets, and you can’t do much about fixing up the place to make it your own.
Buying
If you ask your dad, though (or maybe just my dad), he would likely say that buying is so much better. Buying is how middle class people build wealth. But buying can be very expensive. If you buy, you’ll need a down payment of anywhere between 3% to 20% of the cost of your home. You’ll also need closing costs. Once you’ve moved in, all the repairs are on you.
The upside of buying is that you do get to build wealth. Housing markets go up and down, but historically, their overall trajectory is up. In other words, as the housing market increases in value, so does your home’s value.
If you’re an amateur or professional decorator, buying is typically the way to go. When you own, you can tear down walls and paint with abandon. If you rent, you’re lucky if you can hang pictures.