Renting VS. Buying a House: Which is right for you?

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Renting VS. Buying a House: Which is right for you?

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Every person’s dream is to own a house; it is the most exciting experience. All of us have to make the decision of whether to purchase or rent a home. Many are inclined to buying a house; however, not every one of us is cut out to buying a house because the needs and the income levels are not the same.

Buying or renting a house is a decision that will affect how much money you will be left with after paying bills at the end of every month. If your income level is low, and you choose to buy a house, then it means that at the end of every month, a bigger share of the salary will go towards paying the mortgage, and your lifestyle will change completely, you will have to cut on most of the expenses.

On the other hand, if your income level allows you to buy a house, and you are renting, then it means that you are wasting money because your monthly rent could be going towards paying off your mortgage.

Renting Vs. Mortgage.

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Paying money monthly in mortgage takes a lot more than rent, and the payments continue for years; it can take 15 to 30 years to pay off a mortgage, at low interest rate fully. For low-income earners, the monthly deductions will ultimately hurt their lifestyles. The good news is that the money is going towards your investment, and at the end of the day, you will be a homeowner.

Paying rent every month allows for flexibility, you can always move to a cheaper house, and if you are a low-income earner, you can still maintain a decent lifestyle. The bad news is that the monthly rent being paid to the landlord is a dead investment; in the long run, you will not have any long term investment.

Bottom Line: Choose what is right for you.

High-income earners are better off buying a house because the mortgage will not affect their lifestyles, on the other hand, low-income earners should opt to rent because there are many other expenses to fulfill in life apart from housing.

Some neighborhoods are too expensive to buy a house, but renting in the same areas is possible. So you should assess your own financial situation, and how flexible you are willing to be when deciding whether to buy or rent the house.

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