There are multiple benefits to renting versus buying, and in fact, renting is becoming more common in today’s market because of the high housing prices. Regardless of whether you are renting a small apartment for yourself or a condo for your family, there are many reasons why renting can be more beneficial than buying. Here are some of the benefits of renting versus buying.
The Lack of Ongoing Added Costs
A significant advantage to renting is the lack of ongoing additional costs associated with your dwelling. The purchase of a home not only requires you to pay the mortgage every month, but there are many additional costs associated with owning a place. Land transfer tax, fluctuating mortgage rates, and overall maintenance of your home can be extra costs on top of your monthly mortgage payments, which means there may be more financial stress. When you rent, any maintenance is covered by your landlord, and there is no worry about land transfer tax, or fluctuating mortgage rates, making renting the more cost efficient choice.
Renting an apartment is advantageous because an apartment has less square footage, lowering your utility bill, especially in the winter, when heating is essential. The smaller space allows you to conserve energy, making it a greener choice. Purchasing a home would mean you would have more space to heat in the winter, therefore using more energy. The more square footage you have, the higher your energy consumption would be.
A rental apartment is much easier to deal with in the event that you or your partner need to relocate. With a home, you would be required to hire a realtor, get an appraisal, and hope that someone would buy your house. In Ontario, in the event that you must relocate before your lease is up, the only requirement is that you give your landlord 60 days notice. There are no other responsibilities that you must worry about in the event that you must relocate, regardless of the reason.
The value of a property fluctuates, depending on the location, and therefore choosing to rent may be beneficial to you. With a fixed monthly rental rate, your budget may allow you to live in a more desirable location within the city, whereas if you were looking to purchase a place, the cost may be out of your price range in that same location. Renting can open up many possibilities of living in the perfect location for your lifestyle.
Insurance Costs are Lower
As a homeowner, the maintenance of your home, and any modifications are your responsibility to cover through insurance. This can cause your rates to increase, and put financial stress on you and your family. In contrast, a renter is only required to pay insurance on their personal property, if they choose to do so. This means that monthly insurance costs are significantly lower for someone who rents their place, and they are not responsible for ensuring any maintenance upgrades that occur on their property.
The many benefits of renting vs. buying are obvious when the two are compared. Renting can be very beneficial to you and your family, and can significantly decrease a number of financial stressors in your life, making it a smart choice. For more information on renting vs. buying, visit the Medallion Blog.