Owning a home is the ultimate goal for many people, and this is the reason why there are so many homeowners. However, renting a home is also not a bad idea. In fact, when you consider today’s economic scenarios, you may be better off renting a house instead of owning one. There are many financial benefits to renting, and discussed here are some of them.
1) No Maintenance or Repair
One of the biggest advantages of renting a house is not having to pay for the maintenance of the house or footing repair costs. The landlord is responsible for any maintenance or repair work that the house or things within the house may need. If you own a home, you will have to shell out money for anything that goes wrong or stops working. Depending on the extent of the repair, this can burn a hole in your pocket.
2) Using Amenities
Many apartment complexes have certain amenities that renters can use without having to pay for them. This is surely a money-saver, as these amenities, such as fitness centers or swimming pools, can cost quite a bit. On the other hand, if you own a house, having an in-house gym or private swimming pool can drain out your bank account, and there is an added expense of maintaining these amenities.
3) No Property Tax
All homeowners have to pay property tax, which can vary from place to place. This can work out to be quite a large amount, as it is calculated based on the value of the property. However, if you rent a house, this tax is not your concern, as the homeowner will be responsible for it.
4) No Large Down Payment
When you buy a house, you have to pay a down payment, which is usually a minimum of 20% of the total sale price. This can eat into your savings or get you indebted to family members. But when you rent a home, you do have to put down a security deposit and possibly a couple of advance payment on rent, but the amount is much less significant compared to the down payment you have to make while buying a home.
5) No Mortgage
Even though experts are claiming that the housing market has recovered, foreclosures are still continuing. When you rent a home, you are not burdened by a mortgage that is worth more that the market value of your home. This will give you peace of mind and also ensure that you do not owe money to a financial lender.
6) Budgeting the Rent
You can create a more efficient budget when you rent a house, as you know the exact amount you will be paying every month during the course of your lease agreement. While your landlord can increase the rent, he will give you a notice, and this allows you to budget even the increase. However, if you own a home, you will be adversely affected by the changes in the property tax and mortgage amount. It has also been seen that when renters cannot afford a home, they always have the option of renting a house that is more affordable. This is one luxury that homeowners do not have. If they want to sell their home and invest in a smaller house, they have to think twice, as the cost of buying and selling a house can be expensive because of the associated fees.
If you are looking to stay in a house for a long time, it is better to own it. On the other hand, if you want to save money and do not intend on staying in the property for a long period of time, you will benefit from renting the house. It is best to weigh the pros and cons of owning and renting before making a decision.