Purchasing a property or house is considered an American dream. However, when it comes down to brass tacks, which is the better option, buying or renting? Your choice can directly affect your financial health, personal goals, and lifestyle for the next ten to fifteen years. These decisions primarily affect those in service or those with pre-existing loans (like student loans) in the US. There are also other expenses to consider like premiums, medical, and schooling expenses for children (if any).
Many people are relocating to the US and cannot figure out the best decision for their housing situation. There could be many reasons for the shift, and most people go via a reputable immigration lawyer USA to ensure all the paperwork is taken care of and handled with utmost priority. Many people also prefer visiting different countries on a visitor visa, checking out the place first, and then deciding whether it is suitable to move lock, stock, and barrel.
Who Needs To Think About Buying Or Renting A House?
While most people always want to own their own property, there are a few that need it first. In this category would fall those in other countries returning to America after an extended stay abroad. These people usually are in other countries like the UK on a family visa and are returning to the US.
Homeownership has its ups and downs and is meant for those who can take the additional risk of predictable monthly expenses, renovations, maintenance, handle all repairs, mortgage interests, property taxes and charges, insurances, trash pickup charges, and miscellaneous costs that come with being a homeowner in the US.
Renting is helpful since you know your monthly costs in full each month. It is all mentioned in the lease agreement, and renters don’t need to worry about all the other expenses. While you are not building an asset, you are spending towards housing (which you will one way or another).
What Are The Key Differences Between Renting And Buying A House In The US?
Most people feel the only difference between renting and buying a house is that you either own the property or not. However, when making an informed decision regarding the best course of action for your future, you must consider all possible aspects of the enormous financial and lifestyle risk you are about to take.
- Tax Benefits: Property owners have certain tax benefits not awarded to renters. For renters, there is no mortgage tax reduction in itemized plans. However, renters can opt for the standard deductions available to all.
- Maintenance and Repairs: Homeowners are responsible for the entire maintenance, upkeep, repair work, and renovations of the property. This maintenance can be pretty costly since this work is ongoing. Many homeowners constantly renovate their homes to increase the property value. However, compared to the project cost, the sale price doesn’t go up that much. Renters, however, do not have to bother about any of these expenses. The only drawback for renters is that landlords (owners) may take their time to get the work done.
- Property Value: Homeownership is often considered a way to build assets and wealth. However, like all investments, there are plenty of ups and downs that can affect the valuation of the property. Some examples are housing surplus, maintenance, economic issues, outdated interiors, outdated electricals, plumbing and roofing, and exterior conditions of the house (including the garden and front lawn). The property value also affects the renter since a property that is not well maintained or done up will have a lower rent than one in excellent condition.
Is Renting A House Cheaper Than Purchasing One?
Renting is an excellent way for people to get an idea about the expenses involved in owning a house. However, depending on your lifestyle, the standard of living, and area or locality, you may end up spending more on rent than you would on a mortgage. In this case, you may find it cheaper to purchase a house than rent (depending on your lifestyle).
Is It Better To Rent Or Buy A Home?
There is no yes or no answer to this question as it depends wholly on individual purchasing power, steady flow of income, lifestyle, habits, income, savings, personal goals, and overall financial situation. Taking stock of your personal objectives, career progression, and income statements is best, and then discussing the best future course of action with a trusted banker.