Pros and Cons of Buying vs. Renting

24 Jan 2018

After a few years of living in rental properties, the constant upheavals of having to move house as well as pandering to the whims of your landlord, begin to get tiresome and get you thinking; should you buy your next home or continue with the insecurity associated with renting home.

While every person dreams of owning a home of their own at some point in their lifetime, buying a home doesn’t come easy in the pocket either. That having been said, buying a home is one of the best ways of building equity. With every EMI payment you make, you are making a saving as it increases the equity in your home. Owning a house makes your expenses more predictable over the years as against renting which is only set to swing upwards. Owning your own home also means that you are saving towards your future as home values only go up. Additionally, the interest and property tax payment portions of your EMI payments are eligible for tax deduction.

Here are some pros and cons of renting vs. buying:

Stage of life – While you are below 30, you are looking to settle down into a career and not a home. But after the age of 30, you are planning on setting up a family and it’s better to have your own home so children can grow roots.

Setting up equity – By paying out rent money every month, you aren’t getting any asset in return; rather, you are just helping your landlord pay off his own EMIs and build his equity!

Responsibility – It’s the homeowner who gets to pay the EMIs, property taxes, maintenance, so here the renter gets away scot-free, except that repair works are only done when the landlord’s wishes.

Kids – Families with kids and pets are usually not on the priority list of landlords as they are considered, noisy and messy and capable of destruction. A homeowner gets to enjoy providing space for their kids and pets at their own discretion.

Décor – A renter needs permission (not always given!) before they can make any changes in the home to suit their needs. Such is not the case with homeowners who can make whatever changes needed according to their tastes.

Flexibility – Renters are free to move home to wherever they wish; though it’s believed that homeowners are unable to move, it doesn’t stand true, as they can always move out and give their homes out for rent and even earn a second income from it!

Control – A renter is always at the mercy of the landlord increasing his rent or not renewing the lease as suitable to his own whims. A homeowner, on the other hand, owns his own home and there are no insecurities, only stability in every sense.

Based on the above, becoming a homeowner seems better – but then, there are always two sides to every coin!

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