Renting vs. Buying: Which One's Right for You?
By Keith Loria
Today's real estate market pluses include low mortgage rates and attractive prices, but many Americans still find purchasing a home difficult. Renting and buying both have their benefits and challenges depending on each person's circumstances. Therefore, it's essential to weigh the pros and cons.
A good rule of thumb when considering whether to rent or buy is to predict how long you will stay in the home. If you plan on moving and selling in less than five years, renting is probably a better option right now.
One of the main factors keeping people from buying is the difficulty in obtaining the mortgage they want to afford the property they desire, causing them to either shop for something smaller and less expensive or rent until they can improve their financial situation.
The main problem most people have with renting is that you won't be gaining equity, and it feels like you're throwing your money away. Plus, there's no tax advantage to renting, and there will be restrictions on changes you can make to the home.
Still, there are many benefits to renting. For one, you don't need to make a long-term commitment, and it gives a future homebuyer the flexibility and time to figure out the best course of action, both personally and economically. Other positives include being able to move when the lease expires, there's less maintenance work required, and you don't need to have a large sum of money available up-front to live in a lovely home.
For those who choose to buy, the mortgage balance decreases over time, and equity builds. You also have the freedom to make any decisions you want—including tearing down walls, building decks, and remodeling any room the way you have always dreamed.
While every situation is unique, there is a plethora of rent vs. buy calculators available on the Web to help make your decision easier. Contact our office today to discuss whether renting or buying is right for you.
Reprint with permission from RISMedia. ©2015. All rights reserved.
Eric Slifkin, Team Lead
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