A home is necessary for any family, and providing a roof over everyone’s head is especially important when the family is growing. While some people would prefer to own their home, others might choose to live in a rented home. At the same time, there are still those who are undecided about whether to buy or lease.
Why? Because owning a home isn’t necessarily always better than renting, and vice versa. This dilemma is especially true at such a time when property prices are rising and the market is volatile. However, the main point is that whether one chooses to rent or buy a home is often likely to be determined by their financial position, lifestyle, and family preferences.
Nonetheless, there are ways to navigate this fork in the road with greater clarity. For those debating whether to buy or rent a family home, the following are some key differences in pros and cons to consider. And hopefully aid you in your decision.
The Benefits of Renting a Family Home
- The flexibility to move whenever you want without penalty after the lease expires if the residence does not suit your family.
- If you need a house quickly, renting one is much easier, faster, and less expensive than buying one.
- There is no need to be concerned about mortgage payments, legal fees, and stamp duty, as well as the trend of house prices.
- There is little to no responsibility for repairs and maintenance costs because oftentimes they can be handled by the landlord.
- If you need to relocate due to a job commitment, for example, moving out of a rented home is often faster than selling a home.
The Drawbacks of Renting
- The initial cost of moving in may be high, as some landlords may require a 2–4-months’ deposit in addition to the first month’s rent.
- There is no freedom to redecorate or renovate the house without the permission of your landlord.
- When the time comes renew your lease, your landlord has the right to raise your monthly rent, which could affect your monthly budget.
- Your landlord may also decide to sell the rented property, in which case you will need to find a new place unexpectedly.
- The rent you pay each month goes to the landlord, as opposed to the monthly mortgage payment, which goes toward eventually owning your own family home.
The Benefits of Buying a Family Home
- Being a homeowner will provide you with a sense of stability as well as a sense of belonging as you become involved in the community.
- Even if you are purchasing it for own stay rather than investment, if the price rises, your family would likely benefit when the time comes to sell it.
- You have the freedom to decorate or renovate your family home without seeking permission from anyone (maybe just the relevant authority).
- As you have control over the repair works, it may be completed faster than if you were renting.
- One of the best aspects is that once the mortgage is paid off, the house is completely yours.
The Drawbacks of Buying
- It requires a large financial budget, particularly because there are costs that must be prepared in advance. These usually include a 10% down payment, legal fees, and stamp duty.
- Bank credit requirements are becoming more stringent, making it more difficult to obtain approval for a home loan.
- Banks can raise interest rates in certain circumstances, which means your monthly mortgage payments may increase.
- If you need to sell your family home, it could take months to finalise the sale, so you won’t be able to move out right away.
- Although properties are always said to appreciate in value, this is not always the case, and in some areas, the price may even decrease.
Make the Best Decision for Your Family
Now that you know the upsides and downsides of buying or renting a home, you may realise that there is no right or wrong answer to this. Your decision to buy or rent a family home should be based on your personal and family conditions.
Both buying and renting have their own benefits. What matters most is that you’re doing your best to provide a safe haven for your family. And be certain of your decision. Before putting your money down, carefully weigh the pros and cons and conduct thorough research.
Good luck with your buy versus rent decision, mums!
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