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If you’re looking to relocate and secure a new home, one of your first questions may be: is buying or renting a home a better option? The answer depends on your situation, finances, and preferences. The important thing is to take the route that best reflects your needs. Here’s how you can start working out which choice is the right fit for you!
There are a few key reasons why people choose to own a home instead of renting a property. While every home owner’s situation is different, here are some of the most common motivators behind purchasing a home.
Build home equity
Perhaps the biggest reason Canadians want to own a home is the ability to build home equity. The housing market can be very beneficial to break into, as it is often competitive and owning a piece of land means owning a valuable asset. Home prices often appreciate over time, so many home owners sell their properties at a higher price than they purchased them for as the years go by. This provides a sense of security for Canadians, who know they own a large asset. Many home owners prefer to make mortgage payments instead of paying rent, with the idea that their money helps them build this equity.
Total property control
Another big benefit of buying a home is having full control over how you manage your house. As the owner, you can choose how you want your home to look, what furniture to include, what colour you want your walls to be, and how you want to set up your yard. You can complete home renovations or projects whenever you want, and you don’t need to worry about getting landlord approval for any major changes. Many home owners enjoy personalizing and customizing their houses so they feel truly at home. It is very comforting to be in an environment that reflects your own style and tastes!
Ability to settle in one spot
Finally, home owners are committed to staying in one area long-term. When you own a property, you are anchored to a specific location, presumably one you love. This is a security renters do not enjoy as much, since renters do not have control over landlord decisions or building sales. Home owners can rest assured they can remain in their property for as long as they want, and any decision to relocate is entirely up to them.
On the other side of the buying or renting a home debate are the reasons people choose to rent. Just like with homeownership, there are certain advantages that are unique to renters as well.
More flexibility and less commitment
Renters have much more flexibility in their housing arrangements than home owners. Most rental leases are one year long, followed by a month-to-month agreement. This means renters can choose to relocate without consequences fairly easily if necessary. This is a huge benefit for people who are unsure where they want to live long-term, or who might need the ability to relocate on short notice. Renters do not need to commit to one home for years at a time, so they don’t need to worry about planning so far into the future. This is especially helpful for young adults who may be starting off in their career paths and do not know where they wish to settle permanently.
Lower maintenance costs
When something goes wrong in a house you own, you are responsible for fixing it. Whether you decide to do it yourself or hire a professional, it will cost you money to get the necessary repairs. Renters, for the most part, can rely on their landlord for covering the costs of any repairs in their dwelling. For example, if your toilet stops working, your hot water disappears, or your stove breaks down, you can be confident your landlord will arrange for the repair or replacement. Unless you are the cause of major damage that is solely due to your behaviour, you likely won’t have to pay for any of the expenses. This is a big chunk of money you don’t need to account for in your budget.
Fewer savings required
Lastly, renting a home is financially much easier to do than purchasing a property. Renters do not need to save a down payment, secure a mortgage approval, or make mortgage payments with interest. While you still must be approved to rent, the process is much quicker and flexible than the application for a mortgage. Down payments take years to save, so renting provides a way for you to find your own place to call home sooner. Many people choose to rent so they never have to worry about saving up hundreds of thousands of dollars for a down payment. The financial preparations required for renting are much less stressful than for purchasing.
Which is right for you?
If you’re torn between buying or renting a home, how do you decide which path is best for you? It can be scary to make the leap into homeownership if you’re not completely certain you are ready for it. That’s why it’s important to talk to a broker if you’re considering purchasing a house. We can help you determine whether buying or renting is the better choice for you right now. Homeownership is a great option for those who are truly prepared, but it’s essential that you understand what you are committing to.
If you have any questions about your mortgage, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770 or contact us here.