The American dream of home ownership has been the standard for many generations. But home ownership is not always a pleasurable experience, especially if it comes at a time when you are not really ready for the responsibility. There are many instances where singles, couples, and even families are more suited for renting a home,than buying one. If you are at a crossroads and trying to decide whether you should look for a home to buy or one to rent, asking yourself these questions can help point you in the right direction.
Is your job and location stable for at least a few years?
Buying a home comes with certain costs, in addition to the amount you will actually be paying for the house. One example of this is the closing costs, which typically amount to somewhere between two and five percent of the purchase price amount.
If you buy a home with only a small down payment and then decide to sell it within the first few years of ownership, you may not be able to recoup the full amount of the purchase price, plus the closing costs. Even worse, you might end up in a negative equity position and be forced to take money to the closing to cover the difference when selling.
On the other hand, if you plan to be in the same area for several years, it can be much smarter to buy a home. In this manner, you are investing money into your own home with each mortgage payment, instead of paying it out to a landlord each month.
Are you financially ready to be a homeowner?
Ownership of a home can be a tremendous burden if you are not financially ready and able to meet the mortgage payment on time, as well as all the other associated costs, like utilities, insurance, and taxes. Those who have sufficient income and little or no other debt are best suited to purchase, while those who struggle with meeting their monthly bills should most likely choose to rent until their financial situation improves.
Still feeling undecided?
Taking time to discuss your current housing goals, along with your current employment and financial information with a real estate professional can be an excellent way to find the guidance you need to decide whether to rent or buy. To do this, look for an agent with proven experience in both home rental and residential real estate sales in your area.Share