How To Decide If To Rent or Buy

A commonality with all human beings is the need to have a shelter – a place you can rest and sleep in, a habitat you can store your belongings, a home you can grow in and build memories with. As we move out of our parents’ home and begin our journey to independence, or when we feel we are ready to make that next adulting step, one is faced with the question, “To buy or to rent?”. This may be a daunting and scary endeavor to the ignorant but definitely more obvious to the few wiser. With this, here are a few considerations to help you navigate towards your best next move.

Financial Situation

Before you could start purchasing or renting your next home, the first and most essential step is for you to assess your current finances so you can come up with your realistic budget. How much is your cash at hand? Is it sufficient to cover down payment, closing costs and loan processing fees for a mortgage, or just enough for security deposit and advance payment on a rental? The stability of your current job is an important consideration as well given that home mortgages require 10- to 20-year payment commitment compared to a short-term rental of 6 months to a 1-year lease contract.

Long-term Goals

Determining your life plans is also pivotal in making this decision. If you’re already set on a particular location to put down your roots in and have the financial means to do so, then it may be better to purchase a home and build equity. If, on the other hand, you wish to test the waters first and see if your lifestyle fits with the community, or if your current job or relationship would probably require you to relocate in the near future, then renting could be a smarter move. Abrupt changes and demands in your personal life can easily be accommodated if you are not tied down with a mortgage.


One of the main benefits of renting is having your landlord assume responsibility for the repairs, improvements, and upkeep of the property, thus, allowing you to put more towards your savings. This position also gives you the equally important peace of mind from knowing that someone else will handle the maintenance of your home. For homeowners though, this cost and obligation can eventually be worth it as most property values have an upward trajectory, thereby, offsetting all these expenses from the amount of equity they acquire in their home.

Fixed Costs

As a renter, your primary monetary obligation is to pay your monthly rent. Depending on the terms of your lease contract, this amount is stable for a time being though eventually increases to account for inflation and rise in property prices. If you choose a life of tenancy, you will always have to pay these rental payments. On the contrary, homeowners can be freed of monthly mortgage payments in 10- or 20-years’ time upon full payment of their home loan. However, do keep in mind the property tax due to the government yearly and the necessary maintenance costs involved in owning a home.

Intangible Benefits

Living in your own home gives one a sense of security, stability, and confidence. Aside from having full control on its design and décor, knowing that you will always have a place to come home to is indeed comforting. Your home is not only a prized possession that you are able to pass on to generations, but also a true valuable source of pride and proof of personal accomplishment that a person can achieve in his life. On the flip side, the flexibility of home renting can also provide you contentment and pleasure by not being tied down with long-term mortgage payments, costly renovations and repairs, and fixed home address and location.

To buy or to rent a home is a personal decision that each of us must eventually make at least once in our lifetime. Proper analysis is essential for you to come up with the best scenario that would work for your lifestyle, goals, and finances. To give you valuable knowledge of the real estate industry and assist you in making this decision, consult a licensed real estate broker who has expertise in your chosen location.


By: Niña Norrdell

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