For most people, we’ve heard that the main goals in life are to have a house and a family to spend your years enjoying. This ideal is even described in cliches such as the ‘white picket fence’ dream. What many people seem to miss is that this isn’t the only option for people! You can raise a family in a rented apartment or home just as easily, and for many, it’s the best choice. Here are the reasons many end up in a rental, and how to stop asking yourself, ‘should I rent or buy a house?
Maintenance and Upkeep
As much as many prospective home buyers love to imagine how their yards and gardens will look when they get to put their touch on things, maintenance and upkeep of a property are expensive. If you own your home and your water heater goes out, you could be looking at the cost of a couple of thousand dollars in replacement and working hours. If you’re renting and your water heater goes out, the prices are on your landlord’s hands. This safety net is enough to keep many renting.
Fewer Upfront Costs
When someone purchases a home, there are tons of costs that have to be kept in mind. From closing costs that include a realtor and filing to the taxes and fees that come with transferring the title- a lot of money goes into buying a home. Down payments are four to seven percent of the home’s cost, ensuring many can’t afford to buy property as quickly. When you rent, the only expenses you usually have to worry about is the first and last month’s rent and the security deposit, depending on the apartment, which could be less than a couple of thousand dollars.
A top reason that many people find themselves gravitating towards renting is the need for shorter contracts. This timing doesn’t mean that there aren’t any bonding documents that lock a person to their apartment- just that those agreements are shorter-lived. For those buying a home, your mortgage will be for ten to thirty years. The moment you purchase it, it’s like being in a timed debt to the building. For renters, their contracts are only six months to a year. This shorter time means you don’t have to commit to your home forever and that you can feel free to explore other options.
Having a credit score below 600 is enough to stop many people from trying to purchase a home. Although a score of 570 is possible for some loans, those that will take it are usually extremely expensive because of a high-interest rate. Because of this, many forgo the headache and pain and instead opt to rent. Not only can renting help tenants eventually repair their credit score, but it also allows them to get by a little easier. Renters can ignore their credit score if they make enough per month, and they won’t have to worry about the pain of paying off interest.