Moving to a new city generates a very important decision. Should I rent or buy? Regardless of if you currently rent or buy, moving forces you to consider at the very least whether you should continue your current housing strategy or switch strategies. Today, we’re going to weigh the pros and cons of both options and help you make an informed decision for your upcoming move.

Renting

Let’s kick things off by exploring the perks of renting. First up, we have no maintenance costs or repair bills. Say goodbye to that leaky faucet nightmare. The landlord’s got you covered! Next, we have access to amenities. Pools, gyms, and tennis courts are just a stone’s throw away. No membership fees required! And let’s not forget about the lack of real estate taxes. Your hard-earned money can be used for other things, like treating yourself to a spa day or that new gadget you’ve had your eye on. Plus, no down payment necessary. That’s right, folks. You can keep your savings intact for that dream vacation or maybe even starting your own business.

Now, one of the biggest advantages of renting is the flexibility it provides. You can explore different neighborhoods, experience city life, or even downsize if you desire. Your options are wide open! And hey, if the property value goes down, it’s not your problem. You can just pack your bags and find a better spot without losing a dime.

Another pro of renting is having a fixed rent amount. No surprises here. You know exactly how much you need to budget every month. Lower insurance and utility costs are also on the table. More money in your pocket means more nights out on the town, am I right?

According to Forbes, renting is not a waste of money. It can actually be cheaper, especially if you’re craving that big city life. Save those dollars for those fancy dinners and Broadway shows! Renting also frees up your time and money to focus on growing your income. Want to start that side hustle or take up a new hobby? Renting can provide the financial flexibility you need. And let’s not forget that when you rent, you’re rich with time and money. No more worrying about fixing the roof or mowing the lawn. Sit back, relax, and enjoy the extra leisure time.

Many of the pros to renting are founded in good logic, but I do have to say, some of them don’t hold up and become cons when examined further. The first pro we mentioned that has some problematic logic is the lack of real estate taxes or cost of maintenance or amenities. Though it’s technically true that a renter is not responsible for these costs, landlords do factor these into the rent prices charged. 

Having a fixed rent is also a bit of a problematic pro.Now if we are considering renting vs having an adjustable rate mortgage, this pro would be a very good one. But after the 2008 housing crash, ARMs became much less common due to their high risk. And compared to a fixed rate mortgage, this argument just doesn’t hold up, considering landlords often raise rents every year or so.

Buying

Renting definitely has its perks, but what about the advantages of buying a house? First up, buying a house can actually be cheaper than renting. With landlords raising rents every year or so, it may be more expensive upfront, but if you are planning on living in one area for a little while, buying a house with a fixed mortgage will end up cheaper in the long run and you can expect stable payments!

Plus, buying a house forces you to save. It’s like having a piggy bank that grows over time as the value of the property increases, building equity and net worth. And we know from historical data that property values always go up over time. Yes, there are dips and crashes in the market, but there is an overall upwards trend.

And let’s not forget about stability. When you own a home, you have a sense of permanence. It’s your castle, and you’re the king or queen! Oh, and did you know that owning a home can have a positive impact on your community ties? You’ll develop strong social connections and be more likely to play an active role in the community or local politics, since you care more about the area you live in. Also, buying a house brings pride of ownership. It’s your canvas to personalize and create your dream home. All with no more landlord restrictions!

And here’s an important fact: property is an investment. As a buyer you are paying for your own investment that you can get a return on, but as a renter you are paying for your landlord’s investment and won’t ever see a return. Also, tax benefits come with homeownership. Not only do you get tax benefits for selling a home, but also you can deduct mortgage interest payments and other write-offs. Generational wealth is another great benefit of homeownership, being that it’s an inheritable high value asset. Homeownership can also help generate more income. Buying a home with an in-law suite or other similar guest accommodations gives you the ability to rent the space out for additional cash flow. Additionally, some side hustles or self-employed jobs may only be feasible with property. Examples of this might be raising chickens for selling eggs or building furniture in your garage. 

Just as there are cons to renting, there are cons to buying as well. Maintenance costs are on you when you’re a homeowner. No more calling the landlord to fix that leaky faucet. But hey, you can always learn some handy DIY skills! The risk of decreasing value is another issue. It’s a reality of the real estate market. As I mentioned earlier, historical data shows on overall upward trend in property values, but there is a risk of life events happening that cause you to have to sell when your property value is upside down.

Buying a house also requires a hefty down payment. This is a pretty big hurdle, but a good loan officer should be able to help you see if you qualify for any programs that may help with this burden. Programs that allow for low down payments, no down payment or down payment grants are available for qualified buyers. Moving can be a bit more challenging when you own a home as well. You don’t have to worry about a lease being up or paying a fee for breaking the lease, but financial ability might restrict you, if you owe more than your property is worth due to a dip or crash in the market. HOA fees, property taxes, and other expenses can also add up as well.

Alright, so, we’ve explored the pros and cons of both renting and buying a house. Now it’s time for the big reveal. Which option comes out on top?

Well, I’m sure you won’t be surprised to hear a realtor be in favor of owning a home, but I honestly had this opinion even before I got into real estate. My fiancé and I both saw the investment value in homeownership, and we had a priority of buying a home as soon as we could as part of our wealth building plan. In fact, helping families build wealth through real estate was a major draw for me in choosing this career.

With the potential for lower costs, building equity and wealth, and creating your dream home, the advantages of homeownership just can’t be beaten in my opinion. But hey, let’s not completely discount renting. It offers flexibility, no maintenance headaches, and a lifestyle that suits many individuals.

Ultimately, the decision between renting and buying comes down to your personal circumstances and financial goals. Consider your priorities, consult with professionals, and make a choice that feels right for you. If you are considering moving to Lynchburg, then I hope this video has been informative and helpful in your decision-making process. Thank you and I’ll see you next week!