Are you in two minds whether to rent or buy a new home? This is a dilemma many people face in the shifty post-COVID times. Buying a home is a huge step which many people are reluctant to take, and for quite a few reasons no less. Settling down means continuous investments in your home and usually mortgage in tow – but being a renter also has its downsides, along with the perks such as freedom to move whenever you want and less taxes to worry about. To help you plan your next home move, here are some strategic steps you ought to take into account if you want to get the biggest property bang for your buck.
Consider your financial standing
Buying a home entails extremely high costs. Settling down in your own four walls is probably one of the biggest investments you will ever make, and it entails a rather high financial standing. From the down payment, mortgage, and renovation expenses to the price of furnishings and taxes, being a homeowner does come with a pretty exorbitant price tag. Nevertheless, it might prove to be a worthwhile idea down the road as you will be able to save your money in the long run when paying a mortgage as opposed to monthly rent.
To settle down or to stay on the go
In case you are not a huge fan of living in the same place all your life, it is a better idea to remain a tenant for the foreseeable future. No strings attached may be costlier, but it does allow you to change place of residence whenever you decide. In addition to that, it is a better option in the short term since it will not require a life-binding financial commitment such as a loan against property or a mortgage. To get a better idea of the rent vs. buy ratio, you can look into the offer of Midland apartments for rent and Midland homes to buy and add up the figures and compare the costs on an annual basis.
Be aware of your living expenses
Staying a tenant is a good option if you are able to balance your income and living expenses as it allows you to avoid sometimes prohibitive expenses of buying and owning your own home. On the other hand, in case your living expenses are high and you are living from hand to mouth, you may want to reconsider your options and take out a mortgage to get a place of your own. Of course, you will need your credit score to be impeccable in the latter case and you will need to have at least some cash in savings to be able to fund the property purchase through to the end.
Think about home maintenance costs
If you’d rather not fuss with home upkeep and regular home maintenance costs, purchasing a piece of property might not be a good solution. Every home needs tender, love, and care, but as a homeowner, your responsibility will be higher and your costs might punch a hole in your long-term budget. As a renter, on the other hand, you can negotiate home upkeep costs with your landlord and have them take care of the maintenance expenses and works required for the place to remain functional and aesthetically pleasing, such as plumbing repairs and wall paint numbers.
Building equity over time
As a homeowner, you will have quite a few expenses to think about, but you will also be in for some tax relief and you will also be able to build equity as time goes by, which will allow you to improve your long-term credit rating. As a renter, your living costs and financial commitments may not be as high, but you stand a risk of your landlord terminating the lease at any moment of being evicted without a good reason. Both of these scenarios are pretty real in the shifty COVID-19 property market for both renters and landlords alike, so make sure to take all the details and small print into account before you bounce off to sign a property purchase contract or an apartment lease.
Buying a home sounds amazing, especially if you are a huge fan of security and settling down for years to come. Nevertheless, home ownership comes with a stack of risks in tow, and it might not be a good option for everyone. On the other hand, being a renter does come with a high level of freedom and flexibility, but it is not a good option in the long run as it entails high monthly expenses and little or no room for savings, especially if you are struggling to make ends meet. When deciding whether you should settle down in your own home or to remain a free flat-flier, there are quite a few things you will need to bear in mind – and if you are still here, now you know the basics of home owning vs. renting strategies. Good luck with decision-making, and be sure to count your blessings whichever call you eventually venture to make!