Thinking About Renting Versus Buying

by The Irvine Team 09/30/2019

Dollar for dollar, you might determine that in this year, at this time, buying might be more to your advantage than renting. Alternatively, the numbers may show the opposite: that renting will save you money this year over buying. Given the conventional wisdom that buying is better on the one hand with your bottom line on the other, how do you decide?

The tangibles or the intangibles

Take the example of two identical homes in the same neighborhood. One is for rent, and the other is for sale. Do you choose to rent or to buy?

If tangibly (things you can accurately calculate) the dollars show that renting is less financial outgo (bottom line) than buying, you may choose to rent. However, buying might offset these tangibles with intangibles such as pride of ownership, the ability to make changes and upgrades, or the stability that comes with a fixed mortgage payment.

On the other hand, it might be that dollar for dollar, it would be less expensive for you to buy the home. In that case, is buying always the right decision? That depends. If you are new to an area, you may not be sure that this is the neighborhood for you. Renting for six months or a year gives you an out should you decide that you do not like it there. Perhaps the school does not have the right programs for your child, or you find the commute is too long to your place of work. Until you experience them, you may not be able to determine how these intangibles might affect you. 

Another intangible is flexibility. If you are nearing starting a family, or conversely of becoming empty-nesters, locking down a home via purchase might not be the best choice, because you will have more options in just a year or two. Moreover, if you need to move, repeatedly buying and selling homes produces extra costs in addition to the down payment that you would not have as a renter that needs to move. These include broker and agent fees and closing costs.

Of course, as a renter, you always should prepare for the possibility of your rent increasing with each rental contract or lease. Also, your property owner could decide not to renew your lease for any number of reasons, so you may need to calculate the cost of moving every year or two as well.

Before taking the leap into home ownership or determining to stay in the rental market, talk with a financial professional to determine which scenario best meets your current and future needs.

About the Author
Author

The Irvine Team

Blending a lengthy background in marketing and 25 years of trade knowledge surrounding real estate, Drew & Linda Irvine are the perfect recipe for success.

Originally from New England, Drew has an artistic eye for effective home staging and years of experience in sales and marketing. Linda, originally from the west coast of Florida, brings years of trade knowledge including mortgage origination, title, and experience dealing with closing agents, appraisers and surveyors. Their combined strengths, dual availability, outgoing personalities and true professionalism make them an effective and capable team in any real estate transaction. 

Whether dealing with homeowners or future homeowners, Drew & Linda are always working to make people feel at ease when buying or selling a home. One thing that is constantly said about this team is that their style and personalities makes people feel instantly comfortable and relaxed.  They know that this process can often be stressful and are always striving to make their clients feel confident and secure as they buy or sell a home.

Drew & Linda also pride themselves in their passion and heartfelt drive to stay ahead of the game when it comes to market education, trends and technology. They are familiar with upcoming development and exciting changes in our Treasure Coast and love to put their expertise to use for their clients.

Drew & Linda have three children and are expecting their first grandchild in September. As avid foodies and music lovers, you will often find them trying new restaurants, dancing to local music and attending neighborhood festivals.

If you’re looking for someone with a wide range of experience and commitment to their clients, look no further than the Irvine Team.