Renting vs. Buying
Homeowners have more control over decorating decisions, fewer noise restrictions and can put down roots. Renters have fewer responsibilities but more restrictions.
NEW YORK – People typically have two options when they need a place to live: rent or buy. There are pros and cons to each option, and what is best depends on the person and the situation.
Choosing to rent or buy is a decision with many moving parts, says NerdWallet. Although buying a home is often presented as a fulfillment of the "American Dream," homeownership may not be the right fit for everyone. A careful consideration of owning versus renting can help people decide which option is best for them.
Homeownership
Purchasing a home is a large undertaking that requires a significant financial investment. People often buy a home because they want stability and an asset that maintains value and even appreciates in the long run. There's also more freedom over the living situation when a person buys, as he or she is not beholden to the rules of the landlord. This affords more freedom to decorate and fewer restrictions regarding noise. Homeowners also may not be privy to rules regarding pets. People may be drawn to buying because they know precisely what they will pay each month in living expenses, provided taxes remain relatively stable. Furthermore, setting down roots can help a person feel like part of a community.
Homeownership has some disadvantages. It's a large financial investment that requires a potentially sizable down payment up front. Owning comes with an inherent, though not ironclad, lack of flexibility, as a person cannot simply move to a new geographic location on a whim. There's also responsibility involved in homeownership. Homeowners are required to pay for all maintenance and handle any additional issues that arise.
Renting
Renting can be a more affordable short-term option than buying. Renting enables a person to get a residence at a lower monthly expense and with no down payment. Those who rent have more flexibility if they want to change homes frequently. There's much less responsibility required to rent, as landlords will handle repairs and other concerns. Expenses may be less because there's no need to pay property taxes, and some utilities may be covered by the property owner.
There is a sentiment that renters are throwing away money each month because they are not getting any equity with each monthly rental payment. Rental costs also may not be fixed, as a landlord can increase rent with each lease renewal. Renters also must abide by the rules and regulations of the landlord while renting. This may mean restrictions on parties, noise after a certain time, pets and more.
There's no clear-cut answer as to which is better, renting or buying. People must identify their own priorities and needs during the decision-making process.
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