Use our Rent vs Buy Calculator to determine if you should Buy or Rent your home.
You can input your Rentals Monthly Rent, Additional Monthly Fees, Monthly Renters Insurance, and Annual Rent Rate Increase (%). Then input your possible Home Purchase Price, Annual Home Appreciation Rate (%), Home Loan Amount, Annual Mortgage Interest Rate (%), Years to be lived in the home, Closing Costs, Annual Homeowners Insurance, Annual Property Taxes, and Annual Maintenance Costs.
Advantages And Disadvantages Of Renting
Depending on your life situation, financial status, and tolerance level, renting a house might be the best option for you. Here are some factors to consider when renting a home. Advantages Of Renting:
- You’re free from the hassle of maintenance problems. The landlord is responsible for all maintenance including appliances and miscellaneous repairs. No muss, no fuss.
- Rental payments might be less than mortgage payments. You won’t have to worry about paying property taxes and other incidental costs of owning a house. Changes in the price of housing won’t affect you as much thus lowering your risk in the event of another housing decline.
- You can easily move. When you own a home, you might need to sell it before you can afford to move. When you’re renting you can just pick up and go giving your life increased flexibility. You aren’t tied down by a mortgage.
Disadvantages Of Renting:
- Some landlords will not allow you to make minor alterations without consulting them first. This could include hanging pictures, and other fixtures that would leave holes in the walls. This make it hard to ever truly feel at “home”.
- Some landlords don’t pay much attention to concerns regarding repairs and maintenance. It might be difficult to get your landlord to take action quickly, if at all, when something goes wrong.
- Rentals aren’t investments. Rent payments never build equity – but they can for your landlord. This means you are on an endless treadmill of eternal rent payments as long as you choose not to own.
Let’s switch gears for a moment and take a look at the advantages and disadvantages of buying a house.
Advantages And Disadvantages Of Buying A House
Home ownership is not for everyone, but there are some financial and emotional advantages to consider . . . . Advantages Of Buying A House:
- The house will be all yours once you pay off the mortgage. Also, the odds greatly favor that you will earn some capital gains if you remain in the house long-term. Neither of these will occur as long as you rent.
- You’ll have the option to rent the house out should to decide to move. Rental earnings can be used to pay the mortgage.
- You can pay off your home and stop making monthly payments. Once the mortgage is paid then your housing costs will fall dramatically thus lowering your risk long-term while increasing your equity.
- You have the freedom to remodel and improve your home whenever you want.No landlords to stop your creative expression!
Disadvantages of Buying A House:
- It’s a long-term financial commitment. It’s expensive to buy and sell real estate thus only making financial sense if you have a long-term perspective.
- It can be stressful to maintain a house. It takes time and money to complete repairs and maintenance. Some people don’t want to be bothered.
- There’s no guarantee that the value of your house will increase. There’s a chance that you may even incur losses if you’re forced to sell it due to relocation or financial constraints.
- You’ll need to shell out a lot of money for the down payment, broker fees, and closing costs. The Rent vs. Buy Calculator will take these costs into account and show you which is the best deal.
To assist your decision making process on whether to Rent or Buy a home, Contact us today for a consultation!