It’s about investing in your future, and how you see this happening. Whether it’s renting a property and planning to buy at a certain age, or you wanting to jump straight into buying a home, which would eventuate into becoming one of your biggest assets you will ever own. The decision to rent or buy is a big decision and an understandable problem to have, with both having their own advantages and disadvantages, there are numerous factors that should be considered in either situation.
If you are still not convinced on what decision is best for you, speaking to an expert in the field of residential property, will help you understand what to expect as well as giving you an insight into what pathway would best suit your requirements as well as your financial status. This can all be done by a residential property valuer who will complete a comprehensive valuation report for the property, whether you are renting or buying there is a valuation service that will be especially tailored to your needs.
Although renting and buying are both big financial commitments to make, there are a few differences for each. If you’re asking yourself, in what way does renting beat owning a home? We have the answers for you to consider before making your move.
With renting there are a few financial hurdles to overcome when you first start the process, this may include: security deposits, first and lasts months’ rent, and non-refundable application fees, but this doesn’t compare to the steep requirements needed to buy a property: home deposit/down payment, and closing costs, Although the monthly cost of renting may be higher than the average mortgage costs, you won’t have to worry about the additional property taxes and home repairs costs that tend to sneak up when you least expect it.
No matter the investment there are risks involved, buying a home is one. Becoming a home homeowner, you have the worry of the market crashing, which could affect the value of your property, and the unexpected costs that are costly and could wipe out your savings. This would not be a concern when renting, the biggest risk you may have, would be if you are happy with the place once you’ve moved in, for the long term. And I think that’s a risk most of us can afford to take.
The biggest benefit of renting over buying is the freedom. For example, if you decide to move across states/countries, it would be easier to break a lease (although there are costs involved) rather than having to sell a house and depending on the property this process could take months/years. When renting once you’ve decided on the move out date and paid a break fee, there are no other costs or concerns to worry about.
When renting, certain repairs and the costs for those repairs are the responsibility of the landlord/management company, such as, running toilet, electrical faults, and overall external or internal condition of the property from ware & tear over the years. Depending on your lease, you may be required to contribute especially if they were a direct result of your actions. Calling the landlord is less painful than having to organise repair companies for your own property.
It’s clear that the benefits we’ve mentioned so far regarding renting vs buying come down to finances. This is clearly shown in your monthly budget, home ownership is a variable cost and depending on the terms of your mortgage, interest rates change over time, property taxes tend to fluctuate throughout the year and if something were to happen and you weren’t financially prepared. But when you rent, you are locked into a set monthly amount for the duration of your lease, as you’ve signed a contract for a fixed fee, the only variable costs that may differ slightly will be the utility bills, and that all depends on the time of year and the usage during those times, but these costs will not break the budget like owning a home would.
Life has its way of throwing us curve balls, although we wish for a stress-free lifestyle there are always certain things that we can’t control. As a homeowner you have your day-to-today responsibilities, but when renting you don’t have to think twice about the little things. Like chipping paint, yellow grass or leaves in the gutter. In fact, a renter may not even notice these things.
As a homeowner, your home is your biggest investment and you’re in it for the long haul. So, upgrading your property is all part of the experience, it’s usually expected that if you ever decide to sell your property one day, you hope to make a good return on your investment. Keeping up the maintenance and staying modern as the years go on, will only benefit you and your property’s potential in the future. As a renter, the property you lease for a certain duration may not be your forever home, so it’s a lot easier to accept a property that may have an outdated kitchen or poorly designed bathroom, because its not forever. And as a renter, you’re styling a design aesthetic that can change a property completely and fit your lifestyle for the duration of your lease.
Renting vs Buying, ultimately the decision comes down to you, your lifestyle, the costs and the amount of responsibility you are willing to take on when it comes to a home. There’s nothing wrong with selling your home for the flexibility that comes with renting, nor is there anything wrong with jumping straight into buying a property.
As we mentioned, doing your research and speaking with an expert in regards to a property valuation will help determine what decision would best benefit your lifestyle and your finances in the future. At the end of the day, you want to be happy no matter where you end up.
Kerryn Lee – LinkedIn profile
Kerryn Lee is an API qualified property valuer with upwards of 20 years’ experience working in the Adelaide property market. Her expertise spans over all property types and sizes, and includes specialisation in litigation, compensation, and Family Law Court property valuations. Using this experience, Kerryn has completed valuations on large scale properties within South Australia valued over $10 million.
If your still not convinced and need a better understanding of where to begin, seeking out an industry expert in property valuations will be the first step in considering what is right for you and your financial situation. At the end of the day, you want to be happy, no matter where you end up.