Should You Buy or Rent a Home?

Millions of people have asked themselves this question at one point in time. Buying or renting has its own benefits, but the decision to purchase an apartment, condominium, or house is more complex compared to renting. Ask yourself, “Is now the right time to buy a home?”

Buying a home may just be the largest financial decision of your lifetime. Consider your lifestyle preferences and finances:

1. Do you have a steady income? Because you’ll likely wonder whether you can afford a home or not. If you have a steady income, documented income, and a good credit history, then you already have the foundations for the initial down payment and future mortgage payments. Even if you’re not ready to buy a home, you can speak with a real estate professional and financial planner who can help you answer and uncover questions about the costs of homeownership.

2. Do you plan to stay in a home for an extended period of time? With proper planning, a home purchase can be one of the safest investments that you can make. It’s imperative to understand that investing in a home is much different than investing in a stock portfolio. Homes typically rise in value over time while the owner builds his or her equity through monthly mortgage payments. If you see yourself in a home for only one or two years, you are less likely to see a significant financial return on your investment.

3. Do you plan to sell a home in order to buy a home? A local real estate professional can help you understand the local market’s current conditions and will help you make smart decisions when listing your home on the market. Mortgage financing is widely available for those with a solid credit and a steady income. First-time homebuyers have a tremendous amount of opportunity and flexibility because of the high inventories and low interest rates in markets across the United States.

4. How do your other options compare? For renters, calculating monthly housing expenses is as easy as inquiring about the monthly rent and average utilities. This gets a bit more complicated when you are considering the monthly cost of owning a home, so you’ll want to speak with a real estate professional who can help you understand the range of financial matters, such as tax incentives for owning a home, annual property taxes, etc.