Renting vs. Buying a Place to Live
Is it better to be a proud owner of a house or rather a tenant of a luxurious flat, free like a bird? On some level it probably is a philosophical question. But modern people are practical creatures. They need to bring both options face to face and compare them. Read further to make your mind more easily
Of course, buying requires much bigger initial investment than renting. When buying, one surely has to have some starting capital and make a mortgage contract with a bank in order to get the residence in the first place (that is, if you are not a rich heir or a lottery millionaire). Then come the additional costs on notaries and legal taxes. Note that this money can amount up to 20 per cent of the overall price of the property, and that money is not retrieved when you sell the property later. This cannot be compared to the rent plus the deposit one needs to spend before stepping in the flat.
At first look owing a property has on its tale some extra expenses, like taxes, rates and caretaking. Tenants don't pay for repairing the roof or the heating or the plumbing. However, tenants have to deal with paying the rent every month, and, in longer perspective, rents have a steady tendency of rising continuously.
If buying a home, all or most of your savings will be low to none, after you have to do mortgage payments or payments on the bank credit. If living in a rental home, you can preserve and raise your savings, and use them for reasonable (upon your personal opinion!) purchases such as a new car, a flat-screen TV, a washing machine or a world trip. Paradoxically, researches show that people who own a house under mortgage tend to be live more economically and to manage to make bigger savings than those who don't.
Flexibility and independence
Both are often listed as the main advantages of renting - one is more independent and not bound to a certain place and/or job. Tenants can switch towns and even countries, and take another job or another position in a different place. However, one step away from full independence is the fact that they have to conform to the landlord if changing interior, or the duration and even sudden termination of the rental contract.
Quality of life
Generally living in the own four walls is equal to higher standard. One feels much better, saver and more comfortable and can settle in the own home. Besides, every property is a valuable asset and a kind of insurance for an old age, when the owner has retired and doesn't have an income like before. But here is the place to say again the fact that people living on a rent can afford and tend to go on holidays and trips more often. Plus, in today's cosmopolitan world, young specialists in big cities find it more prestigious to live in enormous luxurious flats downtown, even if they can afford buying.
Owing the home you live in gives the unforced felling of safety. This isn't the case however, if the mortgage payments cannot be paid off the bank has the right and the real opportunity to take the property, and leave you without a home and without all the money you have put in the buying so far.