Buying v. Renting

Before you start your property search, you should take some time to assess whether buying a home is a better choice for you than renting. Both options have their own set of benefits and potential drawbacks.

Whether buying is a better choice financially than renting depends on a number of factors such as how fast rent and home prices are expected to rise and how long you plan to stay in the home. Our Buy v. Rent Calculator can help you analyze the potential financial difference between renting and buying a home.

In addition to evaluating which option is more advantageous financially, you should carefully consider whether homeownership fits with your future plans and the lifestyle you want to live.

Buying may make sense if you...

• Have reliable income, secure employment and are not planning or expecting any major career changes or changes in your employment status that could impede your ability to make your monthly mortgage payments.
• Have accumulated sufficient cash reserves to cover at least a 3.5% down payment and closing costs with adequate reserves left over for a rainy day fund to provide some security in case of job loss, medical illness or other financial setback.
• Are willing and able to take on home maintenance and improvement projects.
• Want a chance to build equity and be eligible for homeowner tax breaks.
• Are planning on staying in your home for a few years and are not expecting to relocate for professional or personal reasons in the near future.
• Want more control over your living space and the freedom to customize it to your own personal taste.

Renting may make sense if you...

• Are in the process of rebuilding your credit and do not at this time qualify for a mortgage loan or are not eligible to receive favorable mortgage rates and terms.
• Have a job that may require frequent or sudden relocation.
• Have a job that is not secure or have income that is not reliable.
• Want the freedom to relocate to a different city, state or country at any time for any reason without much impediment.
• Are not sure what your housing needs are or will be in the next few years.
• Cannot afford unforeseen home maintenance expenses.
• Do not have any interest in or time for home maintenance or home improvement projects.
• Would prefer to invest your money in more liquid assets such as stocks or bonds.