The Rundown: Renting/Buying Pros and Cons

A more traditional mindset would say that it is better to own your home than to be bound by renting. However, we shouldn’t be limited by this prevalent assumption – for those who frequently travel, or for those who are thinking of staying in an area for a shorter period of time, renting would be the definite choice. At any rate, here is a quick list of pros and cons that you ought to know for each approach:

Renting Pros:
– More relaxed requirements to be a Tenant – Your credit rating may not be as good, but you can still rent.
– You aren’t bound to a mortgage, so you are more flexible when it comes to your finances.
– You don’t have to worry about general maintenance costs.
– There is also no need to be concerned if the neighborhood depreciates.

Renting Cons:
– Rent is higher that mortgage payments
– You aren’t building any sort of equity; you aren’t owning an asset – unless, you’re on a rare rent-to-own partnership.
– There is a limit to what you can do – Renovations, Pets, etc.
– Rent can be raised at any time; Also, if the owner decides to sell the property, that means you need to start looking for another place to live.

Buying Pros:
– You are obviously building equity.
– You stand to benefit if the entire neighborhood market appreciates.
– You have the freedom to remodel and restore as you please.

Buying Cons:
– Secondary costs concerning maintenance and taxes can be a hassle.
– Your equity would definitely suffer if market prices go down.
– More difficult to be qualified – You will need proper credit/income scores.
– Mortgage can be overwhelming.