Describe the advantages and disadvantages of buying vs renting?

Answer 1

There are many websites that will give advice about this question. I'll just answer it from the experience of someone who has owned a house outright (no mortgage) but who has decided to currently rent. So, some of my observations: Owning a place outright doesn't make the bills go away. There are rates, insurance costs, repairs. I also found I was spending endless bits of cash on jobs around the house and garden even when I didn't need to. Many of these were labours of love, but they still cost money. An owned home can be a real anchor. If someone difficult moves in next door with a noisy dog (as happened to me), you're stuck with it. That is unless you want to incur substantial costs associated with selling your house and buying another one. As a renter, you can just up and move. Likewise, changing jobs, even taking temporary acting opportunities in another city, is a problem when one owns a house. I found my house had termites! Endless sleepless nights and many $s later the problem was fixed. If I had been renting, I would have passed the sleepless nights on to someone else via a phone call to the estate agent. I also had an on-going problem with a blocked sewer line which the plumber said may cost $5,000 plus to fix if it kept happening. With older houses in particular one never knows what nasty expenses may be lurking. It really is hit and miss with equity. Houses prices were pretty flat in my neighbourhood for some years and, taking into account costs such as rates, maintenance, purchase and sale fees, I would have made more money renting and placing any excess dollars in the bank. Its important to research the prospects for house price movements before buying, and even then its about as certain as the stockmarket. Don't be fooled by people (usually property managers and estate agents) telling you houses are a safe haven for equity growth. Sometimes they aren't. There are plenty of poor souls out there who owe banks more than their properties are worth after prices slipped - they can't sell and they can't move. Do your homework very carefully - this is the biggest investment you will probably make. The purchase and sale costs of houses are so prohibitive that you really need to be sure you're going to be in a place for several years to make it worthwhile. If you don't think you'll be in the same neighbourhood in 5 years time, then its probably not worth it. Eventually, when I am close to retirement, I will doubtless buy a home again. Who wants to be paying rent when they have retired? But by then I'll only need a small place and purchase costs will be lower than the four bedroom family home one needs when bringing up a family. The point is, unless one really needs to own a large family home, which will eventually be replaced with something smaller anyway, it may be worth considering whether renting is a better option in the younger and middle years. Renting is invariably cheaper than paying off a mortgage and the balance might be better placed in one's superannuation than paid as dead money to the bank in interest. Of course, this requires the discipline to save, and not spend, the difference. In the end, its up to you. Buy in the right place and live there many years and you can do very well out of purchasing a house. It can give you many years of pleasure turning it into a home, become an integral part of your family life and leave you financially secure. However, buy in a neighbourhood where prices start to decline and then find yourself needing to move, having the neighbours from hell move in next door or being paid a visit by termites can turn your dream into a nightmare. Good luck with whatever you decide and do your homework well!

Answer 2

Monthly mortgage payments may be more expensive than rent. However, the cost is fixed and will not go up. Part of the money will become equity in your ownership of the home.

Residents of a rental cannot alter their living space without permission.

Both options, renting or buying, may offer flexibility. You can move when the lease is up; with a house you may have additional monies when you sell, so you can obtain another place to live.

Answer 3

Buying and owning a property like house is the best achievement a person can ever had, but in every action we make there is advantage and disadvantage in it. The disadvantage of it, that it is very expensive and that is the advantage of renting, it is affordable.
But for those who can afford buying, it is some kind of investment. For those who can't afford, there are lots of way on how to save.

Answer 4

The advantages of a rental apartment over owning a home is the convenience of a bundle price that includes utilities and rent. The disadvantage of a rental apartment is the fact that you are paying for something that is not yours in the long run.