» Rent Vs. Buy: How To Decide In 5 Steps

There’s no doubt that buying a home is a major life decision, but is it right for you? Of course, there’s no singular correct answer as there are pros and cons to both renting and buying. A major factor in anyone’s decision-making process comes down to finances. In most cases, renting seems to be the more affordable option.

However, that’s not always the case. Your decision can boil down to several lifestyle considerations such as whether you want flexibility or stability, what your career goals are and whether you want a place to truly call your own.

If you’re on the fence about whether you should rent or buy, read on to find out what you need to consider before taking the plunge.

Renting Pros And Cons

PROS

• Mobility/freedom to move around
• Landlord pays for maintenance
• Doesn’t require expensive closing costs
• No fluctuation in monthly housing expenses
• Allows you to test-drive different living spaces

CONS

• You don’t build any equity
• Limited ability to customize your living space
• Rent could go up over time
• Landlord might sell or decide to stop renting
• Limited sense of home stability/permanence

Buying Pros and Cons

PROS

• You build equity over time
• Home value may increase over time
• You may reap tax benefits
• Unlimited freedom to customize your living space
• Sense of home stability/permanence

CONS

• Closing costs can be prohibitive
• Responsibility for maintenance and repairs which requires time and effort
• Less flexibility to move (at greater difficulty/expense)
• Home value may decrease
• Recent tax laws could hamper tax benefits