Should I buy or rent, on my own?

Question

Hi,

Been looking to move out for a while..I am quite financially sound, have a fair chunk in savings and in a steady job. I've not lived away from home before, but hate the idea of renting and paying someone elses mortgage ;) But I am not sure what the sensible thing is to do and would like someone more experienced opinion. Any help would be appreciated :)

Answer 1

If you live in the U.S., you should definitely buy. The real estate market is slow now. It is a buyer's market. You would only want to rent if you plan on being in a certain area for less than a year and when the market is strong for sellers. Good Luck..

Answer 2

I belive that buying is better because it is actually an investment in your retirement. I have had the privillage of buying two homes but I had to sell them both becasue I got divorced. My last home was in a bad area and we made 15% per year in appreciation even though the area was not that good. Good areas were appreciating a 30 percent a year then. If you consider the percentage you are making on your down payment and payments it is astounding. My down payment in 1982 was $17,500 and we made $100K in appreciation in 6 years plus we collected $2200 a month in rent from three units that were behind our house on the same lot. We were actually getting paid every month to live in our home becasue we were collecting rent too. If we had rented all we would have gotten was a place to live and maybe $600 a year renters credit from the state for being a renter. Now I pay more for a room than I was paying for those two buildings on a lot in 1982. We had a fixed rate mortgage so we could plan ahead and not have any surprizes at the end of the month.

Answer 3

If you are in the UK you could consider the shared ownership schemes that developers and housing associations are now promoting if you want to get on the housing ladder but think financially it might be strained.

I'd be inclined to rent though - we first time bought two years ago and although we love our home it is a lot of responsibility and costs a huge amount to keep going. I think rent, keep your savings and build on them - wait to see what the property market does - it is expected to crash, or at least dip down a lot in the next 6 years - you might be better to hold out for that - or perhaps buy a reposesssion property, because already there are a lot of them as people cannot afford the increases in interest rates on the huge mortgages they have.

Answer 4

It depends entirely on your situation.
If you are financially sound and are stable enough to know you are not moving away anytime soon, it can be a great investment.
Rent can come pretty damn close to mortgage and if you purchase a place of your own (even if its a condo or a small duplex) you will build equity. My friends just purchased a small duplex a year ago and they've already built $20,000 in equity. Granted, it depends on the place you purchase and the location... but make a good choice and it is very worth while.
If you end up moving, just sell the place, it is a win-win situation as long as you make a good investment.
Key notes: do not purchase a place that is out of your budget.

Answer 5

If you've done the homework and know that you can afford a down payment and monthly payments, definitely buy. And better yet, buy a multi-room house or apartment and rent out the other rooms to friends. That will help you with the mortgage payments and allow you to put extra money into savings.

When you decide that the house is no longer for you, you can continue to rent it out or you can sell it and have the extra cash you put away from collecting rent.

But make sure you are ready to own--it's not difficult, but you do have more responsibilities: repairing or replacing broken appliances, keeping up the yard, painting, insurance, etc.

Answer 6

If you have a down payment saved and are willing to accept the responsibilites that come with owning a house, then you would be best to buy a house. You would be taking your money into a good investment.

If you are like me and rather spend the least amount possible on living expenses, I rent with a roomate. 600 a month is all i pay for living...no mortgage no maintence no taxes.

All about what you value in your life. Financially, home owning is more sound...but much more aggrivating!

Answer 7

The very best option for a person in your situation is to
"LEASE WITH OPTION TO BUY". A portion of the rent is applied toward the purchase of the home/condo you are
interested in. This is a good way to come up with a down payment for your future mortgage and lock in a good Home price now while housing rates are low.
Consider looking into this option. Again for any future program you choose, please take time to evaluate it thoroughly and never rush into a situation that requires your signature on any legal document.

Answer 8

How long will you live there and how much can you put down? It's best if you can put down 20% to avoid mortgage insurance. You will have to pay closing costs, which can be significant (5% of the house or so). It won't pay off if you're there a short time.

Answer 9

BUY, if you can afford it on your own....like you say, you're paying someone's mortgage and you will have nothing to show for the money you have paid to rent a property, if you then decided to buy. In my opinion, it's money wasted. You won't regret buying your own place . Good luck. :)

PS you could always rent a room in the property to help pay the mortgage.

Answer 10

Put on your big girl panties and buy a house. The housing market is in a slump and buyers can practically name their prices for homes. Plus, you get a tax write-off if you take out a mortgage.

My husband and I built a house when we were both 20 and are currently in our 5th house and waiting for the market to strengthen so we can sell this one and build again. I highly recommend being a home-owner.

Answer 11

If you aren't sure then I suppose it might be better to rent. You could perhaps just get a 6 month contract and see how you feel after that. It'd give you a bit of time to decide exactly what you want. Better that way round then regretting buying something and loading yourself with an unwanted mortgage. Good luck! :)