For some people, renting a home is much better than buying a home and for others, it’s the other way around. There are different reasons people have for wanting to buy a home; most of which are valid — same goes for renting a home. Most people believe that renting a home rather than buying is a waste of time and this notion leads people into debt because of the quest of wanting to own a home. In this article, we will take a look at home renting and home buying as well as their pros and cons. This way, you’ll be able to decide whether home renting a waste of money or not.
Is buying a home a good investment?
As a homeowner, you are building equity monthly; it is, however, important to remember that the amount of equity you are building is equal to the mortgage payment that pays your principal monthly. However, there is no guarantee that your home will appreciate in value as there are several factors that affect this. Some of the factors include property tax rate, income tax, homeowner’s insurance, out of pocket costs, and many others.
You can make money on your home, but this can only happen if you sell it. Some others make money off their homes if the area in which the home is located improves and the value increases. Contrary to what most people say, buying a home is not necessarily a good investment but there are a number of benefits to owning a home.
Is renting any better than buying a home?
In some circumstances, renting a home makes better sense than buying. This is because renting is a smart financial choice because you do not have to worry about housing repairs or volatile land valuation. You can only call renting a home a waste if you are renting more space than you could possibly need or paying a very extravagant price. Renting gives you the opportunity to invest in other ventures rather than the housing market. So, don’t see renting as a waste of money rather see it as a transaction that opens you up for better investments.
To rent or buy a home?
There are certain factors that determine whether renting or buying is the best decision for you as deciding which choice to make is not an easy one. You have to consider your future plans, financial state, time horizon, the economics of your area, and many others. All these factors are necessary as they will help you make an informed decision.
Wrapping Up
Disregard all your earlier notions that renting is a waste of money as on some occasions, you will lose more money buying than renting. If you want to buy a house, ensure that you have your money in other investments that will earn you wealth. The most crucial thing everyone should take with them after reading this article is that homeownership isn’t the only way.
If you are a homeowner and you are falling behind on payments, you could be facing foreclosure. The Debt Relief and Education Foundation has pro bono attorneys that can help. Contact the attorneys at The Debt Relief and Education Foundation today for a free consultation.