An important step into adulthood is making the decision to leave the nest, but many face a more difficult question: is renting or buying a home better? Buying a home requires a large sum of money to put down a deposit, which some younger adults are not quite ready for. Thus, they jumpstart their independence by renting a home or apartment. On the other hand, some couples who are ready to start a family might want to buy a home so they can have a more long-term place to raise their children. Whether you are looking to venture out on your own or find a more permanent residence, consider these questions before you decide!
Are you financially stable?
Buying a home not only requires a hefty down deposit, but also a monthly mortgage that can last for up to 30 years. This means that as an aspiring homeowner, you would need a steady income to keep up with these expenses. Not only that, but lenders will want to make sure that you are responsible and have good credit to your name.
Aside from paying for the house itself, you will also have to buy furniture to decorate if you want your space to feel like your own. Additionally, there are maintenance requirements that come with a house such as landscaping, pool cleaning, or general repairs. These are things people don’t immediately think about when purchasing a home, but they can add up to a pretty penny.
With renting, you’ll still have to pay an initial deposit, though it won’t be as much as one for a house. If you’re ready to be independent, but aren’t ready to buy a house just yet, perhaps renting an apartment is the better choice. You can experience what it’s like to cook your own meals and do your own laundry — without Mom’s help.
Getting an apartment is a good first step because it forces young adults to manage their finances and account for all the things their parents would have taken care of for them. You can plan out your day with working, cooking, and cleaning in mind, but also rest assured knowing that you don’t have lawn maintenance or pool cleaning duties just yet.
What are your long-term plans?
It makes sense for newlyweds or married couples to want to move into a house. Some couples might be moving from their parents’ place while others might be upgrading from an apartment to a house. Whichever the case, it’s important for married couples to live on their own so they can establish a good partnership and dynamic. Along with that, some may be looking to start a family, and it would be ideal to have your own space to raise your kids in.
Alternatively, for recent graduates who still have tuition debt, it might not be the best idea to look for a house. It would be difficult to manage loan payments on top of a large mortgage payment. They can find a middle ground solution and rent an apartment instead, where the monthly payments will be more affordable.
If your plans are not as long as an apartment contract, which can last for up to one year, try renting a room instead! Homeowners who need tenants to fill up their extra space might allow you to stay there for as short or as long as you need.
Moving out of your parents’ nest and into your own can be difficult with lots of choices! But with the right kind of guidance, it can be easy as 1, 2, 3. Whether you decide to rent or buy a home, contact us at The Reed Team. Let us help you get started on the next big step in your lives!