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Renting vs. Buying a Home: Pros and Cons You Should Know

To rent or to buy is an intimidating question, and unfortunately, there is no universal answer to it. 

Well, the reality is that owning a home is considered the American Dream. However, if you have bad credit or no credit, owning a home remains a fantasy, and you are left to rent. 

Evaluating the advantages and responsibilities that come with either option is the best approach helping you answer the question. 

For instance, if you choose to buy a property, it means you may require servicing AZ home loans for a number of years and eventually end up accumulating some wealth. The upper hand is that you are a property owner, and can resell the property after some years and recover the amount paid plus a substantial income.

On the other hand, if you choose to rent, you will not need to apply for Mesa home loans, meaning you will have fewer financial responsibilities in the form of loans to repay. However, you do not own property, and cannot recover the rent paid when you terminate the tenancy. 

To help you figure out whether to rent or to buy a home, we evaluate the advantages and disadvantages that come with either of the two options. 

Buying a property: What are the Pros and Cons?

If you have been considering applying for Scottsdale home loans to purchase your dream home, chances are that you are wondering what it means for you in the long run. Here are some of the advantages and disadvantages associated with buying a home. 

The Pros of Buying a Home

  1. Accumulation of Wealth

A home is considered the greatest asset in one’s lifetime. Therefore, whether borrowing chandler home loans to buy or build a home, consider that you are not only putting a roof over those you love, you are also accumulating wealth.  You can sell the property after you have repaid the mortgage, and earn a decent profit from the transaction. 

  1. Enjoy the Freedom of Renovating and Decorating the Property 

Owning a home comes with the freedom of adding extra rooms as you wish, and renovating the property to match your current lifestyle. 

2. Enjoy Tax Benefits

If you borrow Utah housing loans today, you are entitled to mortgage interest deductions when filing tax returns. This is unlike paying rent, which you do not earn any tax returns on. 

The Cons of Buying a Property

  • Comes with  more financial responsibilities as you have to pay the property maintenance costs, service the mortgage and keep up with monthly utility bills 
  • A home is not a liquid asset and requires time to cash on if you plan to resell
  • Property value depends on prevailing financial times. Therefore, the property may lose value resulting in losses at the time of selling 
  • Buying requires a huge upfront fee compared to renting where you just clear the monthly rent and a security deposit.

Renting a Property, what does it, Mean and What are the Pros or Cons associated with Rental Properties? 

The cost of purchasing a property keeps increasing, with some Utah housing loan companies requiring a large down payment. This means that borrowers have to forego luxuries to save for the seemingly high down payment. 

The alternative is to pay monthly rent, which takes a smaller percentage of the monthly income compared to servicing a mortgage and paying utility bills plus the cost of property maintenance. 

Here is a quick overview of the advantages that come with renting a property

  1. Tenants Enjoy More Flexibility and Freedom 

Firstly, a renter can choose to move from one city to another, and it is an easier experience. This is compared to someone who already owns and lives in his or her home.  Therefore, people who love working in different cities may pursue different opportunities or pure adventure should opt for rentals rather than buying a home. 

The second reason why renting comes with flexibility and freedom is the fact that you are not tied around the difficult mortgage terms and conditions. Mesa home loan companies will put restrictions on the use of the property so long as you have not paid the mortgage in full. In that regard, renting is considered a better option for buying if you are looking to enjoy some freedom and flexibility. 

2. No Property Maintenance Responsibilities 

Renters are not obliged to pay property maintenance costs. It is the responsibility of the landlord ensuring properly paved pathways and repainting of house walls to maintain the property net value. 

Disadvantages of renting a property:

  • Your landlord could wake up one morning and serve you with a rent increment notice. 
  • Renting only gives you a home and not an asset
  • There are no tax benefits
  • Strict restrictions including no modifications or decoration, no pet’s policy and so much more.

Are you wondering whether to rent or to buy? Refer to the pros and cons of renting vs. buying as indicated above to help you make the best decision. Better yet, give us a call at the nearest location to you and we can help you!

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