When Should You Rent a Home?

The thought of living in your first home is an exciting one. After living with so many roommates for a few years and dealing with loud and obnoxious neighbors in the apartment next door, you have dreamed of having a space just for your family that’s separate from the rest of the world.

But now you have to decide whether it is time to buy your own home or stick with renting one. How do you decide? It is good to keep an eye on the housing market, looking for good deals in the buyer’s favor, but there’s more to it than a good selling price. Don’t forget to consider these four things when deciding if you should stick with renting a home.

Flexibility--

If you are not set on staying in the area forever or even the same neighborhood, it’s a good idea to rent a home rather than buy your own. You may have to sign a lease for one year, but that is significantly different than the 30-year payoff you could expect with a home loan.

Other factors playing into the flexibility of your life and how that affects your housing include whether you or your spouse is in school, if you have an amazing job with lots of room to grow, or if you have children that are already settled in the area and doing well in school and among their peers.

Maintenance Costs--

Renting means your property management company will foot the costs of any mandatory maintenance like plumbing, electrical, or other home repairs.

Depending on the home you are in, there could be very few maintenance costs to deal with, but buying your own home means you are fully responsible for addressing those issues, so if you don’t think you can cover home emergencies gracefully, stick with renting for now.

Property Taxes--

Maybe you can get a great deal on the perfect home, but have you looked at what the property taxes will cost you? The taxes you pay are based on an assessment of the value of both the property and existing home.

Things that can play into this assessment are the value of similar properties in the area or the estimated cost to reproduce your home. So if the selling price is a steal, but the property is highly valued, you may pay more in the long run than you had planned on.

Homeowners Insurance--

Don’t forget to compare the cost of homeowners insurance versus renters insurance. Homeowners insurance will be more expensive because it is meant to insure both the home and the items you own inside it.

This expense may also vary based on the assessed value of your home and possessions. If you’re not ready to increase the amount you’re paying for insurance, it is a good idea to wait to buy a home.

Overall--

A majority of the deciding factors you will consider when choosing whether to rent or buy a home will deal in the expenses, but your lifestyle can still tip the scale toward renting even when you have the means to buy. Even if now is not the time for you to buy, you can still make your rental feel like a home and plan for the home you want in the future.