You May Need to Rent Instead of Own (For Now)
Most of us have our eyes set on the big life goals. Get a great job or launch that business, find and marry the one, and get dream home. Homeownership is typically one of the signs you have achieved success and that's an incredible feeling. However, some are not ready to own and should wait. I say again, wait. At least, until you're ready. You want your home to be a blessing and not a curse. There are many benefits to renting that prove to be invaluable. Renting might be the smarter choice and feel just as great!
Here's a few reasons why. . .
1. Maintenance is not required
One of the biggest advantages of renting over owning a home is that you don't have to worry about maintenance and repairs. The landlord is responsible for this.
Renter's insurance will give you as much financial protection as possible. Offering 24-hour maintenance or specialty repairs can offer a great service that you might not otherwise have had access to. You'll find it easier to handle a burst pipe and a broken heater if you're not paying for them!
2. You’re not stuck.
With a mortgage, you are typically locked into a long-term commitment. Most rental leases can last a year but have monthly payments. If anything unexpected happens to you that would make you move, it's much easier to do so with a rental.
3. Extra amenities.
One other benefit of renting is the extra amenities offered. Many standard apartment complexes today have amenities on their premises that tenants can use freely, including swimming pools, gyms, and recreation rooms.
There's a price tag associated with getting it in your own home or using it independently. Furthermore, some places offer extra amenities for tenants, such as smart home technology, that can provide extra convenience or comfort for free you wouldn't get if you didn't live there.
4. No property tax.
In addition to not worrying about maintenance and repair costs, renters do not have to worry about property taxes. These taxes add a great deal of stress to homeownership and take a significant amount of money out of your paycheck. Landlords typically pay their buildings' property taxes as well.
5. No HUGE down payment.
Renting can save you a substantial amount of money up front, usually only needing a security deposit and maybe a last month's rent. A rental property is much easier to pay down and maintain than a home.
6. Property value is not a concern.
Since you are renting rather than owning the building you're in, the property value is probably not an issue for you. This is another matter that the owners are in charge of that you aren't. You are liberated from this stress.
7. Fixed rent.
If your landlord changes the rent after your lease has ended, you'll always know how much you'll have to pay each month. Locking in rent on a lease makes rent much more stable than the constantly changing costs of owning a home (on top of your monthly mortgage).
Having a fixed rent makes budgeting and spending easier, since you know exactly how much you will have to pay every month.
8. Much lower utility costs.
Several rental properties include utilities as a huge selling point. When a rental property pays for one or more of your utilities, you get to keep that entire bill. Also, apartments are typically smaller than houses. Therefore, apartments tend to require less energy to heat, cool, and light.
9. Less debt.
If you want to buy a house, you're going to have to pay full price. But home prices fluctuate. This usually means a bank loan. Then you'll have to pay it back for a specified period of time.
Unlike home ownership, renting places is based on the same rate each month until the contract ends and you are required to pay every single month. You will need a loan for a mortgage, but you won't have to get one for a rental property.
10. Do more.
Renting allows you to do more because of the money you can save, the lack of debt, and the freedom to move when you want. Houses aren't deadweights that keep you from doing things, but they are anchors that may hold you for a while. When you own a house, you don't get the same flexibility as when you rent. Ultimately, it comes down to personal preference.
Final thought
You shouldn't discount homeownership completely, but renting can be more cost-effective effective as you learn to beat debt and build wealth with Lionhood Financial.
In the next 4 years, you might want to move, go on vacation, or gain a new job, so it might be in your best interest to rent instead of buy. Besides your wallet, you'll be glad you did it. Happy renting!