Owning or renting a home is one of the most significant financial decisions you can make in life. When deciding between either buying a home or renting one, you are supposed to consider a lot of aspects. With both options, you have an equal number of valid points to consider, and hence making a decision is not easy. So, you should carefully assess all the pros and cons of buying or renting a home. Along with the pros and cons, you must ask yourself if you need a new home, if you have enough savings if you are ready for this responsibility, and which of these moves is in line with your desires, financial position, and future plans. In this article, we will give you critical information that you must possess when you are faced with the choice of buying or renting condos in Edmonton.
Advantages of owning a house
Owning a house is a proud moment for any person. It comes with numerous benefits. Some of those are mentioned in this section.
Owning a house gives you a great sense of privacy. Unlike rented places such as duplexes, apartments, or rented condos in Edmonton, you don’t have to share walls with your neighbor. You have a whole place to yourself, and there is no room for awkwardness like one may feel in a rented place. Also, owning a home eliminates a lot of unwarranted disturbance. For instance, regular visits by your landlord who continually bothers you to keep the place in good shape is not what you want on a regular basis. Also, your neighbors won’t get disturbed because of your child’s late night or early morning meltdowns and vice versa.
- Provide a nest egg for the future
Owning a home is a good investment. It builds equity, improves your net worth, and forces you to save more money. With time, the value of your home increases and you get high returns on investment. Also, it becomes a source of income if you rent your house.
More stable than renting
Buying a home is an excellent step in settling down and becoming a part of a community. It gives a sense of stability to the owner who then lends the same stability to their community or neighborhood. People who own a house move less frequently and as a result, building strong bonds with the people of their community. It also induces a sense of security as living in the same place builds trust among neighbors.
Owning a home reduces the amount of taxes you pay annually. It deducts your mortgage interests and property tax from your federal as well as state taxes. Though you have to bear the repair and maintenance costs, the load of paying extra taxes is taken off your shoulders.
Disadvantages of owning a house
Owning a house has numerous advantages that had to be mentioned. But, you must also be aware of certain disadvantages if you are thinking of going for this option. Here are some for your knowledge.
Long-term financial commitment
Owning a house is a long-term financial commitment. If you are a nomadic type of person who does not stay in one place for a prolonged duration of time, owning a home is not an option for you. When you buy a house, many responsibilities come along with it. No one other than you will take up those responsibilities.
- Responsibility for maintenance
One of the responsibilities of owning a place is maintaining it. You have to make sure the place is in good shape and incur maintenance expense on a regular basis.You are relieved of these responsibilities when you rent a home and not own it.
High mortgage rates
When you buy a place rather than renting one, you have to deal with significantly higher mortgage rates. So, if you are planning to buy a home, make sure you have a constant and growing income to help you better manage your finances.
Advantages of renting a house
If you one of those people who continuously keep changing places, renting is a suitable option for you.
Cheaper than buying a home
Renting a house is a more affordable option. However, your landlord will ask for some advance payment in the name of security deposit. But, these expenses add up for less than the value of down payments you have to pay when you own your house instead.
Unlike owning a home, rental places do not demand a long-term commitment. You can rent a place for as long as you require and leave it when your purpose for staying in that place is completed.
Minimal maintenance cost
Your landlord takes up all major maintenance work that your rented place requires care. You do not have to worry about those expenses. This is a significant advantage of renting a home as when you own a home, you are completely responsible for keeping it in shape.
Disadvantages of renting a house
- No tax incentives
Unlike the tax incentives enjoyed by a homeowner mentioned earlier in this article, renting a home is devoid of any tax incentives.
- No stability
Talking about stability, renting a house has limited or no stability. Your rent may increase at any time, or you may be asked to empty the place by your landlord. Such situations may put you in a tight spot. So, if you think renting is your option, be careful about such events that may catch you off guard.
- No building of equity
Renting a place is like living in a temporary shelter. Unlike home ownership, it does not help you build equity as the place you live in is not truly yours.
Buying or renting a place not only depends on your financial stability but also in your comfort zone. As your home is a place where you spend most of your time relaxing, making the right choice is imperative. Finding it difficult to make a choice? Get in touch with us at Rental Advisors where our experienced team will help you make an informed decision.