by FranchBuying Vs Renting
“Should I rent or should I buy?” That is the age old question!
Buying a home is the dream of many. It signifies that you have “made it”. Deciding if you want to buy or rent will affect your financial health and lifestyle.
Renting offers flexibility and mobility.
We are here to break down the merits and demerits of both so that you can make an informed decision!
Buying:
Merits
Sense of security : Buying a home will provide a feeling of security. It will provide stability and a sense of community with other home owners in the area.
Builds wealth : Owning a home will allow for value appreciation over time. Real estate has proven to be one asset class that beats inflation time and again.
Wealth generation : Owning a home or multiple homes will allow you to rent out the property if needed , thereby generating a steady income. This can be made into a great revenue generation model if the right investments are made.
Demerits
High investment : Buying a home involves putting down a relatively big sum of money as down payment. This essentially blocks large amount of funds which could be used for other investments.
Maintenance cost : Owning a house will incur continuous maintenance costs and taxes to be paid.
Renting:
Merits
Flexibility : Renting allows you to shift base as and when required. You can just give the owner adequate notice and shift houses as and when required.
Ease of planning : Since the monthly rent is a fixed cost , you can plan your finances easily. There will not be any addition unexpected expenses that one may incur while owning a house. The landlord usually takes care of all taxes and maintenance expenses.
Demerits :
Insecurity : The land lord may suddenly decide to cancel the lease or even sell the house. In this situation , you will be left to look for a new house in a hurry.
Loss of capital : You will be paying a fixed monthly amount to the landlord and at the end of the rental tenure , you will not own anything. Instead of this you could buy a property and pay the monthly mortgage to a lender – that way at least you will own the property.
In summation , there is no right or wrong when it come to buying or renting. It all comes down to your financial comfort and priorities at that point. When in a dilemma, it is recommended to talk to an industry expert , like Franch Realty, to understand your options better.
