It is not easy to decide which the best option is: buying or renting a property. The dilemma is intense both for those wishing from the beginning to acquire their own home, covering their new family needs, and the tenants who spend an important amount of money per month for a real estate which they will never own. Before getting the final decision to purchase a property it is useful to consider that its purchase is not for everyone. Not because they do not deserve it but because they can not cope with a loan and as a result they find themselves in unpleasant situations. There are advantages and disadvantages of each option in order to come up with the correct decision that will meet your requirements and abilities.
• There is no need to spend a large amount of money- perhaps all your savings as a deposit- and your savings remain available for investment.
• Renting is usually a short term commitment starting from one year and therefore you will not find yourself stuck in one area, but you can easily move around.
• You have no obligation to undertake major maintenance costs, or pay property taxes.
• In some cases, the lease may be less expensive than owning a property. So while you may be able to pay the rent for a luxurious house, you may not have the financial ability to purchase a corresponding residential construction.
• As your obligation is limited to a relatively short lease, your commitment to pay a certain rent is not an arduous decision.
• Although you pay a monthly substantial amount as a rent of a house, you do not acquire any ownership rights to it.
• You are required to accept any rent increases.
• Your ability to change and form a property as you like, is very limited.
• You depend on the owner in terms of property maintenance and repair and this can create problems if he is negligent or indifferent to maintain it in a good and functional condition.
• There is a possibility of eviction if the owner decides not to renew your lease and live in this property or sell it. The possibility of being forced to move out without choosing this and search for another property is high.
Advantages of Buying
• You enjoy a sense of ownership as you know you will gain full ownership of a property by paying a monthly amount.
• You have the complete control regarding the decoration and layout of the property and the surrounding area as well as the freedom to choose the constructing materials.
• You feel more stable because as long as you pay the mortgage loan and arrange your financial obligations arising from the property, there is no need of worrying about eviction from the property.
• In a property which is yours, you will stay longer than from one you will rent, which is why you feel more secured from frequently changing residence and therefore neighborhood.
• The property generates surplus value.
Disadvantages of Buying
• You have the ultimate responsibility and obligation to maintain the property and keep it in good condition and undertake all costs they entail.
• You undertake payment of premiums for home insurance.
• You may need to borrow a large amount of money for the purchase of your residence and your obligation to repay your loan creates great weight in order to be consistent and not risking losing your property.
• There is always a possibility of losing your real estate and credit rating if you can not keep up with the demands arising from a mortgage loan.
• You lack capital for investments since it was placed as a deposit for the purchase.
• You have a limited possibility of relocation. If there is a need to move to another area it is both difficult and time consuming to sell your existing property and buy another.
Whether or not someone wants to become an owner of a property it depends on his/ her lifestyle and it’s a personal choice. Acquiring a property is something which almost all of us want or seek to acquire.