Renting Vs. Buying a house: Which is better?

Renting and buying a house is a big decision you have to make since you have to invest a lot of money and carefully plan your financial savings. In most cases, some people prefer to rent because it's more affordable, while others buy a house to have a place they can call their own.

If you're stuck in a situation where you can't decide which is better, read on to find out the pros and cons of renting vs. buying a house, the difference between them, and some questions you can ask yourself if you should rent or buy a home.

Pros and Cons of Renting a House

Pros of Renting a House

• Flexibility to live wherever you want to.
• You are not responsible for the maintenance and repairs since your landlord will take care of the needed maintenance.
• Fewer upfront costs and paperwork.
• You won't have to pay the property tax.
• Less commitment because you don't need to worry about maintaining the place.

Cons of Renting a House

• The landlord can increase your rent anytime.
• Renting isn't an asset since you don't own the property.
• No tax benefits.
• Inability to decorate or make renovations because you don't hold the place. You can't also bring a pet if it's in the housing policy.
• You have little to say in your housing situation, and your landlord may sell the property if they want.

Pros and Cons of Buying a House

Pros of Buying a House

• You have a place to call your own, and it's considered your asset.
• Owning a house can give you more stability.
• Since you are now a homeowner, you can have tax benefits.
• You have the freedom to decorate your home whenever you want and have a pet if you like.
• You have your privacy.
• There is no landlord to bother you.

Cons of Buying a House

• Owning a house requires more responsibility because of the monthly maintenance and repayments.
• Renting may be more affordable than purchasing a home.
• Property taxes can increase anytime.
• If you plan to sell your house, you could lose the money you invest instead of gaining it since the home value may decline.
• Your monthly expenses may rise.

Differences Between Buying and Renting

There's more flexibility with renting. Renters often don't need to sign long-term contracts that bind them for years; they can move out any time and are not responsible for maintenance on their units like owners. They are not also responsible for property taxes and other costs homeowners must pay.

But there are also good reasons to buy a house. As a homeowner, you can customize your home to suit your family's needs by doing things like adding a bedroom or bathroom. 

When it comes to the financial benefits of buying a house, homeowners pay property taxes and insurance each year, but the good side is they reap the rewards of these added costs through living in their homes for years or even decades. Renters don't get the same perks; you'll likely find another place to make your living when your lease runs out.

There isn't much difference between renting and buying — it all boils down almost entirely to personal preference. If you're unsure whether it's right for you, consider taking baby steps: Buy a house if you want a big project that will add value to your life in the long term, or rent if moving around is more your thing. 

Should I Rent or Buy a House?

These are some questions you can consider to help you determine whether you should rent or buy a house:

1. Are you prepared for long-term investment?
2. Can you afford the monthly repayments and other maintenance costs?
3. How long do you plan to stay or live in one location?
4. What are your financial, family, and career goals?
5. Do you prefer flexibility or stability?
6. Do you have a stable job that can support you along the way?

The Bottom Line

There isn't always a clear answer, but always keep in that both buying and renting a house have pros and cons. And no matter what you choose, make an informed decision based on your financial situation and lifestyle preferences.