52 Simple Ways to Manage Your Money – 48. The American Dream – Owning Vs. Renting
What it is…
The “Great Debate” between owning your own home and tenting. Often taken for granted, the possibility of ownership has become more remote for many young people, yet many benefits remain.
How it helps…
Renting; allows for mobility; no large down payment required; affordable; close to neighbors in multiple-unit housing; may not require ownership of a car if location is central and public transportation is available and acceptable.
Owning: offers stability; gives a feeling of possession; can offer investment opportunities through appreciation; you may be more separate from your neighbors; gives you freedom to make decisions about the property.
Key items to look for…
Renting:
- The terms of the lease— how can you get out quickly if you have to?
- The neighborhood— how safe is it?
- The amount of deposit— how you can get all or part of it back when you move.
- The condition of the property and other charges, such as utilities, etc.
Owning:
- The terms of the purchase— interest rate, down payment, amount of monthly payment, etc.
- The size of the property— the actual boundaries, limits on the use of the property, easements, etc.
- The purchase price and the value of the property in relation to the neighborhood.
- The neighborhood— how safe is it?
- The condition of the property.
- Other costs upon moving in— hook-up fees for utilities, etc.
Keys to action…
Renting:
- Check local newspapers carefully co become familiar with the current rent rates in different areas.
- Check your budget co determine the optimum amount that you can afford for rent.
- Talk to realtors, colleagues, and friends about the market and about what is available
Owning:
- Take your time. You will be there a while and mistakes can be hard to overcome.
- Working with a realtor has many advantages, including the fact that a professional is working on your behalf.
SET IT UP
Review your lifestyle and the location of your place of residence.
Is it more practical to own or rent?
STEP ON IT
Study the market.
Either choice brings good buys and poor buys.
STEP ON IT +
Be prepared to make the commitments and sacrifices chat go with the pros and cons of your selection.
Notice …
What are your priorities in life?
How much of the decision is yours?
But what if…
I sacrifice and buy a house, and then the value goes down?
- Recognize that this is a lifestyle choice and not an investment choice. If the value increases, that is an added bonus. Your home is an important part of your life’s fabric.
Thought primers…
To me, renting means…
To me, owning my own home means…
If I bought/rented, Mother/Father would say…
At the thought of changing my lifestyle, I…
When I think of signing a long-term lease, I…
