To Buy or To Rent?

The Better Option

Buying a house has been the talk of would-be-buyers since the imposition of 30% RPGT  coupled with the clampdown loan criteria imposed by BNM way back in 2013.

Expectations are such that there is a strong belief that the price of houses will slowly decline to be within the reach of the common wage earner once more.

Is that so? Any early indications? Can you but an affordable unit anytime soon as we reach the mid-year mark of 2014?

Then there is the other school of thought.

Why buy when you can comfortably rent so that it will not create a dent on your savings and life-style.

Let us look at the pros and cons of renting a house.

On the surface, renting a house or an apartment seems to be the more economical of the two choices. With only having to pay the monthly cost of rent and basic utility bills, people need not concern themselves with the details that come with housing loans and avoid a lot of the risks that comes with the possibility of not having the capability of paying off those mortgages. It is certainly a far less complicated scenario.

Another advantage of renting a home is the mobility it provides. Considering how it is very likely that one will encounter a situation wherein packing up and leaving on relatively short notice (like a job opportunity in a far away land), merely renting a home makes it simpler to change addresses without having to sell the house or find someone who would take care of the house.

Renting, particularly an apartment, makes sure that certain small problems are taken care of. When the need for repairs and maintenance occurs, the responsibility usually falls on the landlord, instead of the tenant, to take care of such matters.

There are also a few disadvantages to renting. The lack of security is one of the most glaring of those disadvantages. At the end of the day, the house you live in is not yours. There is also the regular increase in the price of rent that regularly occurs. This would throw you off budget or prompt you to look for other lower rental  neighbourhoods to live that commensurate with your financial capabilities .

Let us now look at the pros and cons of owning a house.

Having your own home is a benefit in itself. While there are going to be financial obligations that come with purchasing your own home, the one thing to take away here is that you will end up owning the house you live in, giving you peace of mind, and a paid up property at the end of the day.

One thing you can do with an owned house, which you generally cannot do with a rented one, is to  to have a go at home improvements that suits you. Since you own the house, barring local building by-laws, you can basically do with it whatever you please.

Having your own home also guarantees that you can leave behind a legacy for your kids, which is a big deal these days. If you have a family, then living in your own house ensures that your kids will have somewhere to go to whenever they need it. Essentially, you guarantee that you and your family have a roof over your head for the foreseeable future.

The disadvantages of owning a house are also several. As alluded to earlier, having your own home makes moving out complicated and difficult. Sometimes, it can be immobilising, having to choose between an owned home and a career opportunity.

Funding your own home may also take a long time, thus the enjoyment of owning a home may come after years and years of paying it off.

So what is your verdict?

With both housing options brandishing their own set of pros and cons, it is really up to which one fits your lifestyle more. If you are a mover, rent. If not, plant your roots in your own home.

Quite a simplistic evaluation, don't you think?