Buy Vs Rent is the smarter choice? There is no right or wrong answer to this question, it just depends on where you are in your life and what you want out of your living situation. Here are four questions to ask yourself to help you decide what’s right for you.
What’s Your Timeline?
How long do you plan on being in your new spot? If you plan to stay for a long time, buying would be the best option. However, if you’re still not sure how long you will remain in that location, it may be best to test the waters out in a rented property. On the flip side, if you buy a home and need to move due to a job or other reasons, you can always use it as a rental property, even earning a little income each month. Property management companies can help you manage renters, repairs and payments while you are out of town.
During times of transition, renting for a year or two gives you time to get your feet on solid ground before making a life-changing decision. Here are a few examples:
- You just graduated from college and aren’t ready to plant your roots in one place yet.
- You moved to a new city and aren’t sure which neighborhood is right for you.
- You’re in the military and don’t want to lose money on a home every time you’re stationed in a new place.
How Secure Is Your Job?
If you have a job that with a consistent paycheck you should be good to go! If you work on commission only or a similar setup, you may need to wait a few months until you get an established flow of income. Not only for financial stability, but your lender may require a certain amount of paystubs that show a consistent income for commission only jobs. Talk to your lender about the specifics!
What about A Down Payment?
Have you saved enough at this point in your life to cover a down payment for a home? If not, there may be options available to help you with coming up with your down payment. Contact us for details!
Will You Be Better Off Financially?
When renting, your money goes towards paying for your landlords investment. When buying/owning your own home you are putting money towards your own future and your own investments. If you are paying the same amount in rent as you would in a mortgage payment, it might be time to start looking to buy a home.