Home “ownership” has got a nice ring to it when you say it, you can stand tall and proud when you point to your own domain and say “I own that house”.
For most people owning their own property is the ultimate objective in life, but there are still a large number of people that prefer renting rather than having a house of their own.
There are many decisions which we all have to make in life – where to work, who to marry, which car to buy and making a decision of purchasing a property is one of the best decisions that we can make in our lives, with the most obvious benefit being the security and stability home ownership offers.
Property experts have stated that even though it might appear that renting has more short-term benefits than owning a property, home ownership however definitely has more advantages in the long run over renting.
While home ownership is not for everyone, advantages that home owners have over tenants is that they don’t have is that they can offer their families a much more secure and stable life while renting offers no such guarantees.
Benefits of buying a Property
You are in control…
When you buy your own property you have the peace of mind of knowing that you can permanently live there for as long as you want unless you encounter some unfortunate circumstances that will force you to sell your property.
Unlike tenants your stay at a property is subject to a lease agreement between you and your landlord and this has no automatic guarantee that it will be renewed.
When you have a bathroom or kitchen that you don’t like, want to change the wall paint color, add some interior and exterior décor, or add even do some improvements you have the flexibility of totally revamping it into a space that matches what you want.
You win in the long run…
What is the difference between a tenant and someone paying a bond of R10 000 for example after 15 years?
They are both paying the exact same amount but one of them actually benefits at the end of the day and that is the one buying a property.
If your property is in a well located neighbourhood which is close to essential amenities such as schools, malls it will appreciate in value over time, which results in the increase in your own personal wealth.
You can rent it out and get passive income…
One of the things you can take advantage of when you own your property is leasing it out and getting a passive income from it. That income that you get every month can be put back into the property itself through improvements or going towards the mortgage payments.
Through online platforms such as AirBnB most homeowners have been making huge profits through renting out their rooms which might for renters might not be allowed in their lease contracts.
On the other side of the coin…
When you renting you are actually paying for someone else’s bond and even after faithfully paying your rent in time there are no guarantees that your lease can be renewed when it expires. If the home owner decides to sell the property there is absolutely nothing you can do to continue staying there.
Benefits of Renting
More Flexibility to where you can live
One of the most important benefits of renting over home ownership is the fact that you have the flexibility to live virtually anywhere you want, and when you no longer like it you can move to another location that has what you are looking for.
With home ownership you are more restricted to where you can live by your affordability, mortgage, insurance, property taxes and so on.
Also when the economy takes a hit you have an option to downgrade to areas that are more affordable, and this is much more difficult for home owners to buy or sell a property to downgrade because of the various fees involved in buying or selling a property.
Fixed Monthly Rent
For tenants they have fixed monthly rentals for the duration of the lease agreement which means that they are able to budget and save much more effectively than homeowners who have to deal with fluctuating property rates.
No Down Payments
Tenants have a one up on home owners when it comes to the upfront costs that are associated in home ownership. Although a tenant might be required to put up a security before moving in, it is significantly much lower than the down payments required to get a mortgage on your property.