Buying or renting a house? Here are the pros and cons

MANILA, Philippines – One of the most important things a family should have is a home.

Paying for monthly house rent can be painful. It’s a regular expense that weighs on your finances and you don’t get any tangible investment under your name.

Acquiring a property is definitely an option and a dream for most families with regular incomes.

Whether you decide to rent or buy a property, here are the advantages and disadvantages:

Buying a Home

Advantages:

• Owning a home is one of the best investments you can make because it is a great potential in your personal wealth as it benefits your security and equity.
• The value of your house and lot will always appreciate over time. So when you decide to sell it, you will surely earn a profit off the sale.
• You have control over your property. You can do anything with it. You can alter everything, including the interior and exterior, for your needs and wants.
• If you don’t want it anymore, you can sell it or have it leased for added income.
• If you availed of a home loan, it will be a good way to improve your credit score if you’re a good re-payer.

Disadvantages:

• It’s a huge financial responsibility. Loan payments and house maintenance are never cheap.
• Interest and fees, such as association dues, are always present unlike when you rent – your landlord pays for these things.
• Reselling is not easy especially when you’re located in flood- and earthquake-prone areas.
• Owning a home entails real property taxes that have to be paid annually based on the assessed value of your property.

Renting a Home

Advantages:

• No ownership and less responsibility. You can come and go as you please. You can move out anytime because there’s not loan to think about (which can be as long as 30 years).
• Save money on maintenance costs because these are shouldered by the owner. You can share the rent, electricity and other bills with anyone you want.
• You can live in an area where you can’t afford to buy in.

Disadvantages:

• Rent costs may be as high as your loan payments. You don’t have a say in anything. When your landlord sells the property, you have no choice but to move out.
• There’s restriction – you can’t just renovate or fix it.

Look at all these pros and cons to help you make a sound decision on what really suits your needs, lifestyle and budget. Buying a home is a good investment, but if you can’t afford one yet, renting is good for the time being. At the end of the day, choosing between buying and renting all boils down to one thing: your long-term financial capacity. – Rappler.com

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MoneyMax.ph is an online platform for comparing financial and telecom products and services. It aims to give the power of smart purchase decisions back to Filipino consumers by providing everything they need to become financially savvy.