What’s the real difference between owning vs. renting?
Rent is just throwing money away!
You might have heard this sentiment at some point when considering owning vs. renting. But is it accurate?
As it turns out, there are plenty of positives and negatives attached to both owning your own home and renting a place to live. Some benefits of owning, such as building equity, seem obvious. Some of the costs, however, can be hidden.
When it’s time for you to decide between owning vs. renting, keep these tips in mind.
This is the biggest point many homeowners take into account when buying their first property. Equity represents your ownership stake in your home. It grows over time as you make improvements and pay down your mortgage.
Equity is an asset. You can borrow against it, use it to fund your next home purchase, or pass it on to your heirs. Renting doesn’t provide you with equity; this is what most people mean when they say rent is “throwing money away.” But there are other considerations that make renting attractive.
Property Management Costs
As a homeowner, you’re responsible for everything on your property. From shoveling snow in the winter to mowing the lawn in the summer, you’ve got to handle it all.
Renting can be attractive for people who lack the energy, interest, or funds for maintaining a property. A landlord is usually responsible for major repairs, including replacing broken appliances. As a renter, you don’t have to worry about property tax, inspection & appraisal fees, or closing costs.
While the lesser responsibilities of a renter appeal to many, renting also comes with a lower emotional stake in the property.
Sense of Place
Home ownership can be seen as an investment in a community. When you own your own home, you’ve become part of the neighbourhood and have a vested interest in the area. You have complete control over your home’s interior design, including flooring and paint colours. You can authorize renovations, change out appliances, and enjoy living in a place that’s exactly how you envision.
By contrast, renting can bring a sense of impermanence. Generally, renters cannot repaint rooms or replace appliances. You may have less control over landscaping, if you have a yard. Renters may feel less invested in neighbourhood organizations or council meetings.
Of course, that lowered investment may be what some renters are looking for!
When considering owning vs. renting, one of the major factors is flexibility. Home owners are tied to their property in a stronger sense than renters. If a new job offer comes up, or you want to move to be closer to family, selling your house can be a long and involved process.
If you travel frequently, move cities often for your job, or simply haven’t decided where to make your permanent home, renting can offer more freedom. It’s easier to end a rental term and begin a new one than buy and sell property. Every lease is different, so be sure to check the penalties for breaking a lease before you sign one.
What’s Right For You
Ultimately, when you decide between owning vs. renting, you’ll choose what’s right for you. The right call may be different throughout your life.
If you’ve decided to buy a home, our agents at Coldwell Banker Fort McMurray can help. We can even advise you on purchasing a rental property. You can enjoy the benefits of home ownership while offering a place for those who would rather rent.
Give us a call today and we’ll get started on finding your perfect property!