Homeowner Or Renter ?
Lately, I have been involved in a lot of conversations about owning a home or renting a home. In recent years, real estate prices have increased exponentially. In Greece, I have seen the sale of houses in 2022 increase by 40% and rent in some cases by 50-60%.Many people thought, ' Why pay such high rents when I can buy a house with an interest rate of almost 0% and have my own house '. When we first see almost 0% interest on mortgage loans, we naturally get blinded and think that we will milk the cow forever, but interest rates will eventually rise, and a mortgage loan is a long-term loan that we may have to pay off for 20-30 years depending on the amount of principal borrowed.
So there are two sides: those who believe it is better to own a home and those who believe it is better to rent. As far as I know, there is no one right answer; both have advantages and disadvantages.
owning a house
Pros
Owning a house builds equity over time as the value of the property increases and the mortgage is paid down
Homeowners have more freedom to make changes to their home, such as renovations or updates, without the need for landlord approval.
Cultural and family values, In Greek culture, owning a home is often seen as a symbol of stability and security, and may be considered a rite of passage for many families. Additionally, many Greek families place a high value on passing down property to future generations.
Cons
Homeownership can limit flexibility, as it can be more difficult to move or change living arrangements due to the costs and time involved in selling a home.
Homeowners are responsible for the maintenance and repairs of their property, which can be time-consuming and expensive.
Housing prices can appreciate over time, they can also depreciate. Nothing is fixed.
Renting
Pros
Renting have more flexibility to move or change living arrangements without the responsibility of selling a home or finding a tenant.
Renters are not exposed to the risk of fluctuations in the housing market, which can impact the value of a home.
Repairs and maintenance most of the times is the responsibility of the landlords.
Cons
Renters may be subject to rent increases when their lease is up for renewal or if the landlord chooses to increase the rent during the lease term
Restrictions on customizing or renovating the property
No equity
Iboth sides have good arguments, so it all depends on circumstances, needs, financial possibilities etc
I own a house and I think that it's better to own a house than to rent it.
You?
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I don't own a house yet. At this moment in time renting seems more appropriate for me given the flexibility it offers. Owning a house is no piece of cake!
I love the legacy part and passing it down to future generations. It's a great experience to live at a place where one's great grand parents used to live.
Yes owning a house it's not an easy task. it's a commitment especially if it's specifically for living and not renting out to someone else.
unfortunately since I live in a big city like Milan the house prices are very high and therefore in some way it is better to rent even if lately it is reaching stratospheric prices
In Big cities it's almost impossible to buy a house nowadays unless you are rich or want to get really indebted.
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Unfortunately homeowners percentahes are on a slump. It's no longer as easy to own a home as it was half a decade ago.
Now, even if you owm a home and no longer live in it you can still profit from it aside from the usual price appreciation, which is not really a price appreciation but rather a hedge against inflation, by renting the house.
Yes they way younger people view owing a home is rapidly shifting. More and more younger people don't wont to commit on house or a city. that is good too.
Yeah, especially when interest rates are low it make sense to lock in a mortgage as those cost of that debt doesn't inflate while the cost of money does.
There is a ratio somewhere that shows whether buying or renting makes sense present day, which in some areas of America renting actually makes more sense.
I still lean toward ownership tho, especially since I turn them into rental properties.
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If you can use it for renting or something like airbnb, renting a sofa or a room then you can even pay the monthly repayment. I also thing that buying is better especially in the right circumstances
In Brazil, I would say buying (of course, with a lot of savings) 'cause the price for renting ridiculous high.
Like you said there is no right answer. It is different for everyone.
For some people who are not that into investing, a home becomes their main source of retaining and going some wealth.
But for a savvy investor who has a great deal on rent, he can deploy more capital towards stocks, a business, or crypto of course. The latter of course is the highest appreciating asset class which can change lives quickly (for good and for bad if not careful).
Lets not forget that comparing buying to renting for buyers there are some things that don't cost as much or don't exist for renters, like:
-interest on that mortgage
-property taxes
-other home taxes (everywhere is different)
-basic maintenance costs (think wear and tear + damaged paint, walls, plumbing, electrical work etc)
-big maintenance costs (think roof, hot water tank, foundation, yard, snow etc)
-higher insurance costs
and so much more.
Yes there are a lot of “hidden” costs that you realise after you bought the house 😂
Here in Pakistan, where we live, we have our own house, it is a very good thing, but here why the house rents here are very high and we don't even know about the months that pass and we have to pay. It is said here that the life of a person who owns his own house is much more peaceful because he does not have to pay rent every month and the same money can be spent on his children.
It’s better there to own a house since you don’t have to worry about rent payment etc.
In Nigeria there are very few estates that are cost-effective enough to consider buying. When we think about owning a home in Nigeria we usually are thinking about building one from scratch in your own compound in a new area fenced without neibours.
Building it from scratch if you have the financial means it’s the best cause you making it exactly as you want
Yeah, I agree! more expensive but very fulfilling. You also have generations that can read into the mind of the builder...beautiful legacy.
I had a boss once, who used to say that they would never own a house because he wanted to have the freedom to go wherever he wanted. He also had a family of 5 members in total!
To cut the story short, he had houses/apts that he rented and he always was in the rent, living in other people's homes.
However, he has made lots of money.
I think it is not really important, having your own house comes also with lots of extra expenses. What someone chooses depends on their priority and financial plan
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He saw owning a house as a pure investment and not a place to live. That was a great plan !
I live in the south of France where the cost of renting a sufficiently large house is slightly less than the mortgage payment I would pay to buy it. From my point of view, the rent is money I throw out the window. The real problem is finding a lending institution that will finance you. Once the financing is obtained, (the debt capital), it will depreciate over time due to inflation (which is normally in the order of 2% in Europe and France), assuming that my salary retains the same purchasing power or even grows in the meantime (and considering that I am at the beginning of my working career, this is very likely... I hope). The house should keep the same value, but this depends a lot on its maintenance and the demographic pressure in the area where I live.
If I buy a house with the right characteristics I will have no difficulty reselling it when I want to.
I agree that the choice between buying and renting depends on many factors. I believe that renting a home can be a good solution for those who are looking for flexibility and want to avoid commitments. If you want to learn more about rental options in Australia, I would advise you to visit the Rentola website: https://rentola.com.au/. Here you will find various real estate properties for rent, as well as useful information on finding a suitable option. Good luck in choosing a house or apartment!
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