If you’re moving to Salt Lake City, you will have to decide whether to rent or buy a home here. The good news is that there is a wide array of choices for you in the city, whatever your decision may be. Just make sure to weigh your options very carefully.
Here is a list of benefits and drawbacks about renting or buying a home. Each option comes with a set of its own pros and cons that you must consider before packing up and moving in.
Pros and cons of renting
An article published February 2020 in iPropertyManagement.com reveals that there are almost 137 million housing units in the United States. Out of this number, around 930 thousand are rentals. Despite the strain of rent prices and lease terms, many Americans see renting as a great real estate option. Now, let’s see some pros and cons of renting your house:
Flexibility is the primary advantage of renting. If you have an unstable job situation, your work requires constant relocation, or you don’t intend on staying in one place for a long period of time, renting is the right choice as it does not require a long-term commitment.
Another perk of renting is less home maintenance expenses. If the roof leaks or the HVAC system breaks down, the task of repairs falls on the landlord. You also don’t have to worry about upkeep.
Tenants are bound by the rules of a lease agreement. Before finally getting the keys from the landlord and moving in, a new tenant should sign a lease agreement that cites what you can and cannot do while residing in the unit. The parameters set by this agreement leave you with little elbow room to make changes or renovations to the property. You’ll need the consent of the landlord or homeowner first.
There is no return on investment or wealth creation when you rent. Your rental fee goes to the homeowner’s pockets and there’s no home equity for you to capitalize on.
You have no control over annual rental fluctuations. Your current rent can increase drastically in the coming years, depending on the economy and other factors.
Pros and cons of buying
Buying a home is a worthwhile investment, especially if you’re financially prepared. Here are some pros and cons of buying a house:
Security, equity, and potential growth in wealth are the three most attractive reasons to invest in a property. The value of a home will appreciate over time and the moment you decide to sell, you earn a sizable profit. Moreover, with a fixed-rate mortgage, you won’t have to worry about rising interest rates.
Homeowners enjoy more freedom with their properties. Owning a home does away with having to deal with a landlord or any third-party rental agent. Apart from any construction limits set by law and physics, you are free to do renovations to the property that will suit your tastes and needs.
Buying a house is a major financial responsibility. From the huge down payment to the taxes, insurance, and maintenance fees, buying a house requires a solid and sustainable source of funds. Mortgage can help to finance a home purchase, as long as you qualify for their terms.
There’s no guarantee that a resale will be profitable. Economic factors like recession or high interest rates can put a strain on your home reselling efforts.
Home maintenance costs are shouldered by the owner. If you buy a home, be prepared for future expenses dedicated to home maintenance. Thus, see to it that you get a home inspection prior to buying.