Should You Buy or Rent?

By
Real Estate Broker/Owner with American West Realty and Management 12599

Should you buy or rent?

It's a question we all face at some point in life: does it make more sense to buy a home or to rent? Most people believe it's wiser to buy a home and build equity rather than paying someone else's mortgage. In most cases, that would be true but there are particular times in life where it makes more sense to rent.

To help you with the decision, realtor.com provides a rent vs. buy calculator that can help you calculate the net cost of buying a home versus the cost of renting over time. Net costs compare the total amount of money you would be spending over time, minus the potential value you might receive if you someday sell the property.

scale with coinsIf you view the interactive graph, you can see how the benefits change over time and the impact of keeping the home for a longer period. Be sure to customize the options to get more specific results.

Keep in mind this is an evaluation of the financial costs. There are other things to consider before deciding whether you should rent or buy.

 

Comments (11)

Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Nathan. People should buy since the discipline of investment is beyond the capabilities and discipline of most! Enjoy your day!

Dec 12, 2017 05:24 AM
Nathan Gesner

The "forced savings" affect is definitely a consideration, Wayne!

Dec 12, 2017 07:04 AM
Barbara Todaro
RE/MAX Executive Realty - Happily Retired - Franklin, MA
Previously Affiliated with The Todaro Team

Good morning, Nathan Gesner for those who "qualify," buying should be the number 1 option.... but unless the payment and entire financial picture is a comfortable one, renting would be preferable.....

Dec 12, 2017 05:32 AM
Nathan Gesner

I agree...most of the time. There are situations where it makes more sense to rent. It's important for individuals to assess all the factors and make an educated decision.

Dec 12, 2017 07:05 AM
David Popoff
DMK Real Estate - Darien, CT
Realtor®,SRS, Green ~ Fairfield County, Ct

If you are planning to stay for more than 4 or 5 years then buying tends to work out best in my experience.

Dec 12, 2017 05:38 AM
Nathan Gesner

I agree that is probably a good rule of thumb.

Dec 12, 2017 07:06 AM
Nina Hollander, Broker
Coldwell Banker Realty - Charlotte, NC
Your Greater Charlotte Realtor

Hi Nathan... no doubt understanding the financial aspects of renting versus buying is important. But we also need to layer on the top that calculation someone's personal needs and lifestyle, as well.

Dec 12, 2017 06:04 AM
Nathan Gesner

Yes, they have to look at the whole picture and make an educated decision.

Dec 12, 2017 07:07 AM
Scott Godzyk
Godzyk Real Estate Services - Manchester, NH
One of the Manchester NH's area Leading Agents

One of the leading places i am getting first time buyers is from those renting, the cost to buy including taxes, insurance and upkeep, was way less for nearly all the buyers compared to the rents they were paying and it was not theirs Nathan Gesner 

Dec 12, 2017 07:09 AM
Debe Maxwell, CRS
www.iCharlotteHomes.com | The Maxwell House Group | RE/MAX Executive | (704) 491-3310 - Charlotte, NC
The right Charlotte REALTOR!

We have apartment buildings sprouting like weeds near our Uptown area that cater to Millennials who haven't had an opportunity to save & build credit. That said it's always better to buy & build equity rather than give your money to someone else.

Dec 12, 2017 11:58 AM
Joe Pryor
The Virtual Real Estate Team - Oklahoma City, OK
REALTOR® - Oklahoma Investment Properties

People should make this calculation but also add in are they up to the responsibility and expense of home ownership.

Dec 12, 2017 05:38 PM
Endre Barath, Jr.
Berkshire Hathaway HomeServices - Beverly Hills, CA
Realtor - Los Angeles Home Sales 310.486.1002

Awesome question and not an easy answer as Michael Jacobs  would say, well it depends:)Endre

Dec 13, 2017 12:28 AM
Debbie Reynolds, C21 Platinum Properties
Platinum Properties- (931)771-9070 - Clarksville, TN
The Dedicated Clarksville TN Realtor-(931)320-6730

Buying isn't for everyone but it can be financially better. Many things are to be considered.

Dec 13, 2017 08:26 PM
Carol Williams
Although I'm retired, I love sharing my knowledge and learning from other real estate industry professionals. - Wenatchee, WA
Retired Agent / Broker / Property Manager

It depends on lifestyle and the need for mobility.  I love knowing I NEVER have to pay rent again since my home has been paid for for many years.  I do, however, have the ongoing expense of taxes, insurance and maintenance which is a definite consideration.  Still, long term, buying is the way to go IMHO. 

Dec 16, 2017 10:27 AM
Nathan Gesner
American West Realty and Management - Cody, WY
Broker / Property Manager

I agree, Carol Williams . Owning your home provides some freedom and is a "forced savings" plan. However, I also agree there are some situations that could be conducive to renting.

Dec 16, 2017 03:42 PM