One of the biggest questions we get from our clients is whether they should buy or rent a home. We tell them that there are a number of factors that must be taken into consideration before making a decision.
Here’s how we help them decide:
Signs that you should buy a home
- You want control over your space
- You’re looking to settle down
- You have a higher credit score and no debt
- You want to build equity
- You’re planning to move in the next couple of months or years
- You want less commuting time
- You’re not ready to deal with all the maintenance work
Buying a house gives you total control over your space. Unlike renting where you have to follow your landlord’s rules (or ask for approval), you have the freedom to customize your home to your liking. You can change the paint colors, replace certain fixtures, and even renovate your home.
If you’ve finally decided on staying in one area for a long period of time, then buying a house is the best decision for you. Mortgages typically last for around 15 to 30 years, which goes to show that buying a house is a long-term investment.
A good credit score makes a huge difference when buying a home. Mortgage lenders usually require a minimum of at least 600 to qualify for a loan. The higher the credit score, the lower the mortgage interest rate.
Having your debt under control (or no debt at all) is also a clear sign that you are ready to buy a home. Mortgage lenders also look at your debt-to-income ratio to check on your ability to manage your finances.
Home values typically increase over time, especially those in popular or highly desired areas. And once you decide to sell the property, you’ll be able to take advantage of its higher value and earn more. However, it will take a significant amount of time paying off your mortgage before your home’s equity grows.
Signs that you should rent a home
Renting a home is most ideal if you’ve recently moved to an area that you’re not familiar with. With a rental, you can get a feel of the area and try out different neighborhoods first before deciding to buy a home later on.
Renting also gives you more flexibility, especially if you’re planning to travel. It is also the better real estate option when you’re unsure about your job or the lifestyle that you want to pursue.
Many rental homes, like condominiums, also offer shorter commute times. This is because these buildings are usually built within or close to the city. If you’re particularly allergic to traffic and long commutes in coming to and from the office every single day, then a rental home would be the best fit for you.
Just like having great (super)powers, owning a home also involves great responsibility. With that responsibility comes a long list of expenses that include maintenance, repairs, mortgage payments, and tax payments.
With a rental, the responsibility falls in the hands of the landlord instead. This person or group will be in charge of the upkeep, repairs, and maintenance of the home.
Whether you plan to buy or rent a home, the Stephanie Clarke Real Estate team will be with you every step of the way. For the past 23 years, we have been helping our clients with all their buying and renting needs. Get in touch with us today!