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▶️ Renting Vs. Buying - Home Ownership | EP#449
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ScottCBusiness
32 Subscribers
41 views
Published 3 years ago
Many people have been debating buying verse renting a home and what is more financially optimal. Let’s dive into the pros and cons of both and then I will share my opinion at the end.

Video Timestamps:
00:00 Intro
02:42 Rent Or Buy
03:30 Inflation
09:04 Renting Pros & Cons
11:45 Buying Pros & Cons
19:30 What I’m Doing
29:00 Outro

Important Things To Consider:
Before diving into the bulk of this, it’s important to consider a few questions that may drastically impact your decision regardless of what’s more financially feasible:
• Where you want to live versus where you are willing to live?
• At what age do you want to own your home and or start the buying process?
• Are you willing to live with roommates or to rent out part of the property?

https://www.realtor.com/mortgage/tools/rent-or-buy-calculator/
This is a random tool I found to calculate the difference between the cost of buying and selling wherever you live. They found that it’s cheaper to rent any place for less than 5 years, but if you intend to stay there for more than 5 years, it will become less expensive to buy a home in the long term.

Renting
Pros
• You don’t have to save a ridiculous amount of money for the down payment.
• You can invest your money and avoid losing wealth to inflation.
• You have total freedom to move and live anywhere without being tied down geographically.
• You don’t have to pay for home maintenance, condominium upkeep fees, property tax, or insurance.
• Getting rid of roommates or changing your living situation is much easier.
• You don’t have to stress about the property, its value, or anything related to the legal and administrative side of owning a home.
• Tends to be cheaper than buying within the first 5 years of living there.
Cons
• You cannot easily make modifications to the property.
• You are not building equity – you are putting money into paying off someone else’s mortgage.
• Lack of certainty & stability that you will keep renting after your current lease ends.
• More expensive to live there after 5 years.

Buying
Pros
• You will have your own home. This can provide a huge amount of peace and bring less stress to your life.
• Ideally your real estate will appreciate a lot in value.
• Your rent payments will go towards equity instead.
• You can sometimes get tax benefits for owning your home, especially for first-time buyers.
• It’s cheaper than renting if you intend to live there for more than 5 years.
Cons
• You need a massive amount of money saved to afford the down-payment to get a reasonable mortgage.
• Housing prices are currently at all-time highs.
• You have to pay home owner’s insurance, home maintenance, property tax, or condominium upkeep fees.
• You will pay insane amounts of interest on your mortgage aka this asset will make you lose money acting more as a liability.
• Your ability to move or travel will be greatly limited, and you will have to deal with potentially bad neighbors, a bad neighborhood, etc. over time.
• If you rent out part of your home or have roommates, it’s more challenging to evict tenants or change up the living situation given the landlord usually has much more legal obstacles.
• Real estate is very illiquid.
• You need to find the right home to buy and you need someone who wants to buy your home in order to sell.
• There could be one-off events that can impact your home value and people’s willingness to buy it like natural disasters, animals on the verge of extinction living on your property, or someone dying in your home.
• There are additional costs to selling and buying like inspections and realtor fees.

For the rest of this including my recommendation and what I'm doing check out these links:
Publish0x: https://www.publish0x.com/at-scottcbusiness/renting-vs-buying-home-ownership-xnxlklx
Read.Cash: https://read.cash/@scottcbusiness/renting-vs-buying-home-ownership-fb10ca11

Are you renting or putting equity into a home? What works best at what age? What’s right for you? Let me know what you think about this in the comments below and don’t forget to subscribe!
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*Disclaimer: This is not financial advice and is purely for entertainment purposes. What you see, hear, or read is my personal opinion, and any statements made are based on my views and should not be misconstrued as fact. My crypto portfolio may or may not be simulated*
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