Buying a house is a big decision. You may be wondering if renting is better for you financially. But owning your property doesn't just make you a proud owner of an asset but also gives you a psychological satisfaction of your space.
The idea of having to take care of your house can seem daunting to some people. Not only do you have to pay for repairs after natural disasters or wear and tear over time, but you also have to consider expenses like taxes, insurance, and utilities. Owing to this, many people choose to rent a house. And instead use their money in other ways, like traveling or investing in stocks. Both the choices have their own set of pros and cons. Reading through this article should give you a rough idea of whether you should buy a house or rent it.
It can be hard to decide whether it's better to buy or rent a house as there are many factors to consider before making the decision. Price is one of the most critical considerations in this decision, as you may save money by renting. However, if you plan to stay in your new home for a long time, buying may be the best option.
Renting is also an appropriate option as it doesn't require you to invest all your savings into it at the time. But impressive schemes and offers for a home loan at the lowest possible interest rates seem to fascinate us.
The home loan interest rates are becoming competitive every day, in turn reducing the installment each month. But there is a catch here when you buy a house with a home loan. A home loan ties you in with a long-standing relationship with the bank financially. You can't step away from the EMI's until you clear all the dues to the bank. Let us look at two aspects of buying a house to understand this better.
Emotional Aspect:
To some people, buying a house is a step up in their lifestyle. They feel a great sense of achievement. Buying a home is a big decision and should be thought objectively/logically and not emotionally.
Financial Aspect:
When you buy a house, you compromise on your flexibility and freedom. As mentioned above, when you buy a home, you're signed up with the bank for a long term, and you cannot leave the house. Renting a house gives you the freedom to relocate multiple times.
How to know if you need to buy or rent a house?
If you know that you will stay in a specific geographic location for, say, 20 years and the chances of your relocation are very little, you may consider buying a house.
If your finances are strong and the interest rates are lower, and the stay's end cost is low compared to renting the space, you may consider buying the house.
If you want a precise analysis of the finances, please click here to check out a Home BUY/RENT finance calculator. Key in all the values here, and you will be able to make a choice.
Courtesy- Magic Bricks
If you plan on buying a house, the ideal age to buy a house is in your 30's because an average home loan lasts 20 years, and you may not want to keep paying your EMI's after your retirement.
Hope this article helped you make a decision.
Hoping to see you all soon!
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