Your home is undoubtedly one of the most important things in your life because it’s a place where you can feel at peace and otherwise safe and relaxed even if you’re dealing with numerous stressful things. Have you been considering whether now is the right time to buy a home or if you should rent instead? There are several things that could help you reach a firm conclusion about that common question.
The Likelihood You Could Secure a Home Loan
A home represents a significant expense. Because of that reality, you probably won’t be able to afford the upfront cost unless you have inherited a significant sum of money or gotten into a similar situation due to a wealthy relative who wants to help you get your first home and has the cash to make it happen.
If you’re like most people, a home loan is the only way you’ll be able to afford the place to live. There are many types of paperwork you may have to produce as proof of eligibility, such as employment history and tax returns. Your credit report will also likely be examined.
When the probability of getting a loan seems very low, that may be one of the major things that convince you to keep renting instead of buying. However, if you have read documentation about the things that are typically required from loan applicants and feel you could meet or exceed those expectations, now might be a great time to invest in a place to live
Your Willingness to Pay for Home Maintenance
One great thing about renting a home is that if your refrigerator breaks down or the heater goes on the fritz, it’s usually your landlord covering the cost to fix the issue and all you need to do is report the problem. However, if you own a home, you’ll need to set up a budget for maintenance.
Sometimes, potential homeowners have difficulty figuring out how to calculate the amount they need to put aside for upkeep, but there are a couple of methods to consider. One of them involves figuring that the maintenance for your home over a given year will be the equivalent of one percent of its purchase price. There is another technique involving budgeting one dollar for every square foot.
You may not feel nervous about the potential maintenance needs associated with being a homeowner, especially if there are people in your household who are skilled enough to take care of minor repairs or you already know some trustworthy companies that can handle things when problems arise. However, if you are anxious about how much repairs might cost and feel you don’t want to bother with logistics when issues come up, it’s probably best to rent a home.
How Long You Plan to Stay in the Area and How Much You Like It
If you have been offered a five-year contract position at Duke University and like Durham, NC so much that you’re almost certain you want to stay there even after the period has finished, those are strong indicators you should look at real estate in Durham and make serious plans to buy a property. That’s also true if your kids are enrolled in school there and you like the educational system or you have put down other roots in the area in meaningful ways.
However, if you’re still getting to know the area and haven’t warmed up to it yet or you are certain that staying there long-term is not a plan you’d get behind, renting is a smarter solution. It doesn’t tie you down to a particular area and doesn’t make you have to deal with putting your home on the market before moving
Eagerness to Receive a Return on Investment
A common criticism of renting is that by doing it, you’re just “throwing money away” by putting it towards rent each month. On the contrary, when you own a home, you have opportunities to keep getting returns on investments because you can do various things to improve the residence. Ultimately, they could allow you to ask for a higher price when you put it up for sale on the market if you ever decide to take that route.
Now that you’ve learned some of the things that might dictate whether you buy or rent, it should be easier to make the all-important decision. Good luck!