If you do not have the money to buy a luxury home, you may consider renting one instead. When you choose to rent a home, you will feel more independent as well. As you build your career or start a family, you might consider buying a house. Maybe you are retired and wish to free yourself from the restrictions of a mortgage. If so, renting may be the more attractive option for you.
Looking at the Pros and Cons
If you look at the upfront and closing costs of buying a home, you will probably find renting more and more attractive. Whilst it is advantageous to own a home, it is not for everyone. Some people feel it is more affordable to rent a home instead. For example, when you purchase a home, you need to provide a down payment and will need to buy homeowners insurance. Closing costs cover items such as the taxes, inspections, appraisals, and insurance costs.
You also have to consider the ongoing costs of owning a home. Typically, you have to make loan payments over a period of 15 to 30 years. Preferably, you will take out a mortgage with a fixed interest rate. Otherwise, you might receive some unexpected and unwanted surprises if your mortgage happens to be attached to an adjustable rate.
However, if you choose amongst the houses for rent, you can remove a good amount of stress and anxiety from the entire process. Normally, you will need a security deposit to ensure against damages or delinquent rental payments. The deposit also covers broken leases. The first month’s rent is often required as well.
The moving costs for a rental house is usually equal to moving into a purchased home, however, you probably will have less items to move. Some rentals, if you are lucky, will include furniture. The recurring costs you will assume when you rent include the monthly rental payment, and pet rent, if applicable. To play it extra safe, you also should buy renters insurance. In addition, you will need to check on the cost of utilities. Whilst some landlords permit you to pay only a part of the utilities, others require that you pay for all the utilities besides the rent.
If you choose to buy a home, you will be able to build equity into your living space over a certain period of time and you can receive tax benefits. Renting does not offer these two advantages. However, you do not have to be responsible for the maintenance or repairs, and relocation is much easier than if you own a home. Again, you may be able to rent a house without paying for all the utilities.
Review the advantages of renting for yourself. If you are interested in a luxury property, renting is a viable solution when you currently cannot afford to buy a house.