Should you buy or rent a home?

Deciding whether buying or renting a home is your best deal can be quite a daunting and frustrating moment; although it is among the most important decisions you can take. Numerous individuals are of the opinion that purchasing a home rather than going for homes for rent Olympia is a far SMARTER decision since all your monthly rent figures go to building your assets rather than fattening’ the landlord’s pockets. Nonetheless, without actual market figures and related costs, it remains just a theory’.

In such a moment, it is very easy to conform to external pressures from colleagues and parents each with their individual suggestions. As such, prior to scribbling your signature on those dotted lines, there are several factors that you need to take into account when searching for a house:

Price-to-Rent Ratio (P/R)

While it is an easy task comparing typical rent against your anticipated mortgage, there are several other costs that come with purchasing a house. One practical technique you can use in assessing whether to rent or purchase a house is better is using price-to-rent ratio.

To calculate this, select 2 similar houses – one for rent and the consequent one for sale. Divide the overall pricing with the expected yearly rent and the answer is the ratio. If the ratio exceeds 20, purchasing the house is said to be more expensive and in such a situation renting is a smarter decision. Renting means you’ll have to deal with a property manager.

Proximity to your Workplace

You will agree that living in a posh lovely neighborhood is dream come true for any house owner. Nonetheless, if the location is not close to your workplace or the area’s business district, the expenses and the hassles become quite significant and tiring.

Whether it is waking up very early or long distance travels, the journeys and tussles become hectic and ultimately boring. Moreover, besides your workplace, you need to take into account proximity to social amenities such as hospitals, shops, and schools.

Work Stability

Purchasing a house when you don’t have a steady job is absolutely senseless. Ensure your job can sustain all mortgage pays and other associated costs such as repairs, interests, closing costs plus other additional expenses that may ultimately overwhelm you.

If you are uncertain about your employment, rent is a better option to allow you to save funds for emergencies and other expenses.

Lifestyle

Contrary to popular convictions, saying that you will alter your lifestyle in order to afford a home is an easy utterance but in reality, habits are rather difficult to break. When you continue to lead an extravagant lifestyle your foreclosure risk gradually increases. That can put luxuries like a house cleaner out of the question.

If owning a house is your major priority, then you need to be committed to paying for the house. In all simplicity, you need to have a steady income plus a moderate lifestyle. If not, then renting a house is a better pick.

Final word

All in all, one thing you need to remember is that the best short-term investment is renting while purchasing a house is the better long-term investment. Prior to making this huge financial decision, it is important you evaluate the market, your subsequent income, and your overall lifestyle and then decide which option best suits you.