There is a huge difference between living in a home where you rent and living in a home where you own. However, they have their advantages and disadvantages.
Buying your dream home requires some big and difficult decisions and some financial sacrifices to pay for a down payment and monthly loans. Although, for many people, it’s all worth their patience and money because homeownership offers many benefits in one’s life.
Here are the disadvantages of renting.
When you rent an apartment, you are restricted from putting up unique decorations in your home, like paints and framed art pieces. The landlord can charge you for piercing holes on the wall and scraping damages on the floor. In your own home, you can build and design your house however you wish for it to look.
While this may not be the most important reason for some people, it will greatly impact your daily life. You won’t have to worry about paying a huge price when you break stuff.
Issues with Your Landlord
The longer you stay in that apartment, the more you’re doing your landlord a favor, paying them as your rent increases while you struggle with your own finances.
If, for example, you requested a repair for your plumbing, it’ll take a while before your landlord responds and accepts your request. Plus, your landlord might even blame you for the damage and charge you for it. When you own the place, you’re in charge of everything and can fix broken things as soon as you need to.
Unlike your rent, home mortgages will not let you down because the interest keeps increasing. Of course, this is if you applied for a fixed-rate loan for your house. Your rent will keep exceeding while you gain nothing. When you buy a house, paying off your down payment and mortgage will benefit you for the rest of your life.
Save your money!
As you pay this constantly increasing rent, you might not have much savings in your bank account. What about health and life insurance and an educational plan for your children? The money you’re supposed to spend on more important things will go with your rent.
Owning a home can increase your net worth. According to the Census Bureau, homeowners have a net worth 80 times higher than renters. When you own a house, it will increase its value over time, and your wealth will grow effortlessly. With this, you can build a more stable financial security.
Another way to save your money when owning a home is you can get several tax deductions. Most relevantly, for the interest and property tax of your mortgage. In the process of consistently paying off your mortgage, you can have a reputation of a good borrower, therefore, a strong credit history. With this, you’re going to have a low risk of default on your loan.
However, renting is not always that bad. Here are some advantages of renting instead of owning a place.
- Depending on the location and the apartment, rent is often cheaper than a mortgage that many people can’t afford.
- When you’re only renting, it is much easier to move from place to place. This applies to people who are always relocating because of their job or people who like to travel all the time.
- When renters are at some financial disadvantage, they have the flexible option to move to another place that fits their budget. When you buy a house, and there’s a sudden financial problem, although still fixable if you ask for help from the lenders, the worst-case scenario is you might lose the house.
- In most renting places, the landlord is in charge of paying real estate taxes and municipal expenses.
- Renting a place requires less cost and less responsibility for repairs and maintenance. The landlord mostly handles these things.
- Some apartment buildings have extra amenities that homeowners spend a load of money on, like swimming pools or a gym.
While homeownership is advantageous for many people, in the long run, it is not for everybody. It requires heavy stability both mentally and financially, and not everyone has that strength.
Some people don’t like the responsibility of owning a house, especially if they have more important things to think about, rather than hurt themselves by saving all those money while the enjoyment of life passes them by.
Of course, every individual is unique. You have the right to choose what’s best for you depending on your lifestyle and your financial situation.