As I have mentioned in the past, we have spent many years living overseas. We often had the discussion about whether to rent a place to live or to research more information about International real estate. We never did buy a place to live while living overseas. We always found a place to live, in a neighborhood we liked, at a price we could afford.
When we were first married we rented an apartment. After 2 years we decided to go house hunting. We found a great house with all the amenities we wanted. We were paying just a little more for a mortgage payment than rent. For us, it was worth the investment to buy a house. Here are some of the things to consider when trying to decide whether to rent or buy a home.
The most important thing is to consider is how much money you have in your budget. Owning a home may be an good investment but there are things you will have to consider when you own vs rent. When you rent a house the landlord is responsible for repairs, lawn maintenance, and other things. When you own your home, you will have to pay for all your repairs. It can be very expensive to replace a roof or air conditioning unit. If you take care of your own lawn, instead of paying a company, you will need to invent in lawn care items. All this stuff can add up quickly and put you over budget. Most experts say your home expenses should not cost more than 25% of your monthly income.
Consider your future. Do you plan on living in your current city for more than 5-7 years? If you plan on moving, buying a house isn’t a good investment. After paying for a realtor, doing repairs, and the interest you will pay in may not make any money back on the sale of your home. It may be less stressful to rent a home.
Do you have debt? When you purchase a home you need a down payment of 10-20% of the cost of the home. Before you start to save for your down payment, think about putting that money towards your debt so that it’s a little less stressful.
These are just a few things to consider when thinking about buy a home. What else did you consider before buying a home?