Renting or buying? Buying or renting?
And is renting really a complete waste of money?
In fact, the question that many are asking is “why pay the rent to the homeowner if I can pay for my home directly?”
To answer this question we must start from the beginning of the question and analyze the situation one piece at a time. And the only thing that makes sense is to analyze the problem over the long term.
First of all, renting a house is not throwing money into the fireplace, but it means having the use of an asset, in this case a house or an apartment. you are paying for the use of space that has no value to you in the future. This concept is basic, the value in the future is the key.
When you buy a house, and in almost all cases you are buying it making debt with a mortgage, you are borrowing money instead of a property and therefore you will pay the debt first, and then the interest for the use of this liquidity.
It should always be remembered that the money you borrowed today is used to buy an asset that will hopefully increase in value tomorrow.
It should also be considered that when the bank makes you a loan, you do not always have all the necessary money for the lend since not all banks provide 100% loans. So you will need to have a place to live for this period.
Another point to be sure of is what is expected in the short term. If you work in a company that sends you around the world, does it make sense to buy a house? If you change jobs and cities often, does it make sense to buy a house?
Being the owner of a house when you decide to take root and create a family is beautiful, but all the expenses that a property entails must be considered, therefore ownership taxes, purchase taxes, writing taxes, possible breakages of part of the house, checks to do at home, management fees and services without having to talk about house bills.
Those who are renting, on the other hand, have only the cost of the rent, insurance, various expenses and bills. And a much easier chance to move if the area gets worse or coexistence with neighbors becomes impossible.
Remember that needs and requirements change over the years, especially if the family grows with one or two children. Buying a house for two people and then having to live there in 4 is not easy but living there 35 or 40 years is certainly more economically viable than living in rent for the same time, especially because after 40 years you will be the owner of a property that will have a value.
But think about how many things can change or go wrong in 40 years, think about the divorce rate in your country.
The issue is difficult to tackle on a general level since each of us has different ideas, ways of life and expectations of the future. The real estate market is a market that must be studied and understood like any market and which is subject to price fluctuations. Many personal factors need to be considered before making the final decision.
Buying a house is simple, much more difficult is having to sell it. Always without falling into the debt trap