Introduction
Inasmuch as the question of owning or renting home is concerned, many people are unable to decide whether to own a home or rent one. This is an important decision putting in mind that either of the options has its own advantages and disadvantages in relation to today’s economy. Therefore, none of the options needs to be taken lightly. It is important for a person to evaluate keenly the benefits and the disadvantages for each and to make a decision, which best suit or rather accommodates his/her needs. In making the decision, one needs to consider various variables that exist at hand. Some of these factors, worth considering include the cost, the long-term implications and more so the economic position of the person and not sparing the general economic environment at that particular moment (Streitfeild 45). The decision of whether to rent a house or to own one is solely dependent on the individual. It is a decision that should be reached after carefully analyzing and evaluating oneself in terms of financial stability and the ability to meet the requirements needed for the option selected. Some of the factors worth considering before making a choice include the level of disposable income at hand, the living standards of an individual, and the amount of income one earns, the spending rate of a person. In addition, one should also consider other environmental factors like, “…availability of loans, investment in housing opportunities, the rate of inflation, security of job, the rate of economic growth and the political stability of a country” (Smith 34). All these factors call for thorough checking prior to making a concrete decision. However, considering these factors, renting passes for the best option in relation to owning a house. One can ask, ‘Why is this so?’ The reasons behind the claims stand out well in the succeeding expositions.
Renting vs. Ownership
Without a keen research on which is better, between the two, people have rushed into owning rather than renting houses. As a fact, they are the very people who file cases in court claiming regarding their houses: reason being that they have failed to adhere to the laid down requirements. Renting a home is more preferable as compared to homeownership to many people. There are various reasons why many people would prefer to rent a house rather than owning their own home. Nevertheless, it is worth clarifying that the stated preference does not declare renting entirely safe. The bottom line is that all have their flaws and strengths, with renting stronger compared to owning a house and the claim. One of the advantages of renting a home is that, it is the only vital and viable way to those people, who earn low amount of income. Renting a house therefore will enable someone who earns low or average salary to have a shelter to go for after his daily activity. Therefore, when it comes to minimizing costs, renting is much more advantageous compared to owning a home, as the cost of owning one’s own home is much higher and maybe beyond the reach of the majority. There is low move in costs when it comes to renting a house as opposed to owning a home. For instance, upon payment of rent and security costs alone is able to get access to a house immediately without having to undergo many logistics and procedures, which at many times may be discouraging and tedious, as evident in those who attempt to come up with their own homes. In addition, the fact that renting bears a fixed monthly payments expense, it allows the renter or of a house to prepare well by preparing and planning the amount due and therefore able to carry on with other activities without feeling the burden in terms of his/her expenditures. Renting also allows the renter to budget for his needs well and make better use of his resources within his scope and his available finances. In renting, it is more convenient in that one is able to select a location which he or she can easily access for instance one is able to make a decision of staying close to his place of work hence cutting some overhead costs he would have spent for example transportation expenses/commuting expenses. In addition, there is less cost when it comes to repairing and maintenance costs to the renters. This is because the house rented is under the management of the owners who is responsible for the costs of repairs and maintenance. This saves the costs of doing such work hence is accommodative and is economically viable or sustainable.
Renting also comes with other benefits like playing grounds, playing amenities like tennis court and pool which otherwise are not easily accessible when one owns a home or otherwise may have increased the cost of seeking for them at other places (Morrissey Para.3). Therefore, people would prefer renting to cut costs of such facilities, which they can easily cater for. Renting generally is less expensive than home ownership. The cost of owning a home is very high, as one need to spend at once. Such an amount may not be available to a person leaving home with the option of renting a house, which he is able to afford. Renting may also provide someone with some surplus amount to acquire some other wants and needs especially is the cost of renting is relatively low. Furthermore, in renting, other expenses related to renting like electricity bills, water bills sewer bills, and garbage collection bills may be included in the rent fee hence minimizing the costs. The renter is therefore relieved of such like payments. It is more convenient for renting a house since it is easier for one to move in another house when one hits a financial hardship. One is able to shift to more cheaper house when there is a financial crises for example financial crisis, increase in inflation rates and in case of bankruptcy of a person as much as other option of renting a house is more preferred in the times of economic upheavals. However, one cannot neglect the other side of renting in his/her pursuit for a choice to make between it and owning a house. Some disadvantages come with renting as opposed to home ownership. These includes there may be a tendency to face uncertain increases in rents which money may not have planned for. This may result in increased cost of living and increased rate of inflation. Therefore this unplanned changed may distort the budget hence leading to financial crisis. In addition, a person who opts to rent a house has a limited space for his /her money in the sense that you are required to pay the required rent due regardless of having other plans which you could spend your money in like investments and savings (Braxton Para. 6). Furthermore, there is a risk of eviction any time by the owner. This risk comes with many costs, which involves cost of transportation, looking for another house and many other costs, which may not be friendly to ones spending. Another disadvantage is that one may be restricted to engage in certain activities. More so, the rent that one pays is not going into productive investments for you and therefore is not the cutting cost per se as it seems to look. In addition, disadvantage of renting a house there is no tax benefits or any other financial returns on the rental payments. Home ownership on the other hand has its own strengths and weaknesses. However, as the paper unfolds, the weaknesses are too expensive to manage, paving way for renting as the only option as afore-suggested.
In home ownership, a person erects his/her own house or opts to purchase the housing unit as his or her own property. However, this take is only limited to people who have a large financial reserve. Highlighting its strengths, home ownership is an investment especially when the owner sells it at a slightly higher price compared to the cost, which it incurred, an increment otherwise called equity. In addition, home ownership also is a good avenue of financial planning and savings as it can assist an individual in planning for the benefits of owning a home later in life. However, could this be the case, then very few would manage to possess one considering the income of the majority and hence not a good option. Owning a home too has benefits in that it improves buyer’s credit rating and therefore acts as an alternative form of accessing credit in times of bankruptcy. In addition, there is benefits of income tax deduction for the mortgage interest and property taxes, potential of increase in value. The bottom line however is that the common person cannot afford his/hers and if he/she does, then durability will be short based on the affordable materials. Investing in home ownership is not easy for those people who have fewer funds in their reserves. Therefore someone with less or inadequate amount is not able to acquire or rather afford the cost of owning a home. The cost of maintain the home too is relatively high. As Presser Points out, the cost of owning a home is not easy to meet owing to the huge amount of money required to carry out the maintenance initiative (47). Money invested in the homes may not be readily available if the need arises since the asset is no liquid. It may therefore take some time before one realizes the money from the sale of the asset due to involvement of huge sums.
Conclusion
As discussed above, it is evident that renting a house is much preferred as opposed to owning a house especially when it comes to dealing with the economic struggles. The advantages, which accrue from renting a house, are more compared that of owning a house. In addition, renting a house has fewer disadvantages as compared to owning one’s own home. As the advantages reveal, renting a house is much easier as the amount involved is not much compared to the money involved in owning a house. Factors associated with economic struggles like lack of employment opportunities and increase in the cost of living standards, because of inflation whereby more money chases few commodities, affect mostly house owners. For instance, in the case of lack of employment, people will have to opt to rent houses that are less expensive and therefore affordable. Although many wish to purchase or erect their own homes, it sounds rather pathetic since the state of economy does not at all allow them to meet the requirements. This therefore, is not the option for many people, who have small financial bases. Irrespective of some of the advantages which results from the ownership of a home like equity and income tax reduction of property, it may not be a viable option for many people especially during economic lapse since it could take time for the conversion of the assets into liquid form. Therefore, it is advisable for a person to choose an option that he/she will be able to meet well. However, it is important for someone to ensure that the option he/she decides on is manageable in relation to the current economic situation to avoid situations whereby a person is not able to meet the requirements like paying rent due and mortgagees in case owning a house. In summary, the decision to rent or own a house should be a personal decision, but as the paper reveals, renting passes for the best alternative compared to owning a house in the current economic state.
Works Cited
Braxton, Geoffrey. Economic Influence on Home Ownership. New York: Word Press, 2010.
Morrissey, Janet. “Price-to-Rent Ratio: Where Houses Are the Best Buy.” Time 2010. Web.
Presser, Caxton. The Cost of Owning a House in today’s World. Britain: Longmans Publishing, 2010.
Smith, Michael. “Homeownership.” Issues & Controversies. Facts on File News Services 2011. Web.
Streitfeild, David. “Housing Woes Bring a New Cry: Let the Market Fall.” New York Times 2010. Web.