Whether to buy or rent the house you live in is a major life decision as it affects the rest of your life in many different ways. Firstly, this decision comes with serious financial implications as it affects your financial savings in the long run and your bank balance at the end of each month. Secondly, this decision also determines the lifestyle you and your family enjoy for years to come.
This is why we suggest you take your time and put ample thought into making the right decision. Continue reading this article to find out 6 different factors you need to take into consideration to decide whether you should buy or rent a house.
As humans, we are all emotional beings who hate change. With time, we often to develop an emotional connection with the houses we live in. This is why owning a house is a much better option for many. Having your own permanent house to live in will give you a sense of security for your future and the chance to belong to a community. These intangible benefits of stability and comfort will make owning a house worth the money you pay.
How many times have you spoken to your landlord about renewing a rental contract only to find out they want to increase the rent once again? Rent hikes are an unfortunate reality associated with rental properties and can be a serious blow on your monthly expenses. As a result, you are left with no choice but to move out since you can no longer afford to pay the increased rent.
While you’ll have to pay a lump sum upfront, you won’t have to worry about rent hikes if you own a house. A mortgage plan has constant terms so you won’t suddenly find out that you have to pay more. This means owning a house will bring stability to your monthly expenses and peace of mind for you in the long term.
Assets and Net Worth
Buying a house increases your net worth in the long run whereas paying rent does not. The money you pay as monthly rent is simply an expense for living in a house. On the other hand, the monthly mortgage payments you make for owning a house are a long term investment. Mortgage payments allow you to own a property which is a valuable asset. This is a way of gradually increasing your net worth.
One major advantage of owning a house is that you can expect to live without paying rent or mortgage at some point in the future. Unlike rental payments, mortgage payments don’t last a lifetime. This means once your mortgage has been paid off, you will incur a much lower living expense for the rest of your life. Thus, you can enjoy your living in your house after retirement without worrying about paying rent.
Buying a house can be intimidating for people who have never done so in the past. With that said, buying yourself a house is a smart financial decision because you can sell your property in the future to make a significant profit. For instance, consider land for sale Wyndham Vale, evaluate it as per your needs-check such options that add value to your investment portfolio & make more out of your financial decision. The value of most houses appreciates over time especially if you do renovations.
Emergencies come uninvited and unannounced and dealing with them can be extremely stressful especially if you don’t have the right resources and finances. If, for instance, you have to spend a fortune on a medical emergency, at least you won’t have to be worried about how you’ll pay the rent if you have a house of your own.
Another one of the many benefits of owning a house is that you can rent it out for generating passive income. If at any point in the future you buy another house or want to live in a smaller place, then you can rent out your previous home to make some money.
The Bottom Line
Some people are still attracted to renting a house because it doesn’t require long term commitment and comes with minimal responsibility. They think of it as an easy option as they can conveniently move out whenever they wish to. However, what they don’t realize is renting a home isn’t a permanent solution to their housing needs.
Buying a house definitely offers many more long term benefits for you and your family. It gives you a permanent place to call home and you can renovate the property according to your personal needs. Furthermore, owning a house will also give you a sense of security and pride of ownership. These benefits ultimately lead to a brighter stable future and this is why the majority of people around the world continue to buy houses despite the huge initial investment.