One of the biggest dilemmas that most people face in their adult life is figuring out whether to buy or rent a home. While buying a home is a great investment, because the cost is ridiculously high, the decision isn’t an easy one to make at all. In fact, for some people, it is quite impossible.
While everyone has a take or a piece of advice to share on this topic, you should learn to filter out the crowd and weigh the pros and cons rationally. To help you make a valid decision and reach a proper conclusion, here are a few questions you should ask yourself when considering whether to rent or buy your next property:
How Long Are You Staying in Your Next Property?
One of the most important factors that will help you determine which is a better decision to make is how long you’ll be staying in your property. Because buying a property is so expensive and is something that most people can’t afford, the only possible way to do that is through loans or mortgages. Because you’ll end up paying a hefty amount as a down payment and committing to a 20-30-year loan/mortgage, you can find yourself in a huge financial obligation. While this is usually a great investment in the future, it does not make sense unless you’re staying at least 4-5 years in this property. The hassle of trying to sell off your mortgage and losing money with real-estate agents makes the entire process not worth it and a lot easier to actually rent.
What Are the Property Values?
The next question you should be asking is how expensive are the prices of the properties you’re interested in. If you’re looking for property to invest in, in Cyprus for instance, seeing as it’s an up and coming market in terms of real estate-, the logical thing to do would be to compare property prices. Real estate moguls from Arazo Estates based in Cyprus clarify that having the option to buy, sell, and even check out valuations is a service that is crucial in the market. In some cases, you’ll find that the price of properties in the destination you’re heading to is reasonable and can help you make a long-term plan. In other cases, you could find the property values to be more expensive than usual and that no matter how much you have set aside, you’ll still find it difficult to afford the price.
However, for some people, the price in mortgage per month is pretty much equivalent to the rent being paid each month. This makes it a wise decision to be paying that money into something you own instead of just going down the drain.
Can You Keep Up with Payments and Maintenance Fees?
Owning a home doesn’t just come down to making a long-term decision in terms of properties, but also making sure you’ll be able to continue making payments or returning the loans you’ve taken. This requires you to have a stable income and a job you like knowing that you’ll have to stick to it or something similar for a fair amount of time in the future.
You will also need to make the proper calculations and be sure that you will be afforded to make the payments as well as pay up the maintenance fees while still covering your daily expenses and living a somewhat reasonable life. Because this is a long-term plan, it doesn’t make sense that you end up paying in all your income and not being able to enjoy your life because of how tight it is. What’s the point of owning a home if it will make you a home-owner with nothing else in life?
What Is the Interest Rate? And Are There Any Hidden Costs?
While the value of a property might seem reasonable as a whole sum, once you start calculating the hidden costs and the interest rate, you could find that it is out of the question. However, there are places where the interest rates of taking a loan especially for real estate purposes are so low that it makes it more appealing to take out a loan. After all, if you won’t be losing much money and be paying the equivalent of the rent or slightly higher into a property you will be owning in the future then why not?
The decision of whether to rent or buy a property is something that everyone goes through in their life. For each person, the variables change completely making the decision highly dependent on the situation itself. To help you make a wise decision, ask yourself the questions above, look at your finances closely and try to figure out how long you’ll be staying in your property to make a wise, logical decision.
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