The media often portrays home ownership as part of the American dream. A man’s home is his castle, after all. However, purchasing a home is a big decision, and families considering it should think it all the way through before they sign that mortgage agreement. In some cases, renting an apartment is the wiser choice. Before you make your next move, consider the following factors.
Deciding Between Renting And Owning
Cost of the Keys
Keys are such little things, but they can represent hundreds or even thousands of dollars spent. The upfront cost of buying a home is often significantly more than that of renting an apartment. A typical down payment on a house is 20 percent of the home’s price, and homes average around $200,000. Not all mortgages require a down payment, but experts recommend that prospective buyers be able to make one.
When you rent an apartment, you often have to pay a small application fee, a security deposit, and the first month’s rent (and sometimes the last month’s rent as well). If you have furry friends, you can expect to pay a pet fee. Even if you’re renting a place in a new building in a popular neighborhood, you still save money over buying a house.
Month to Month Expenses
Usually, when you budget for an apartment or house, the first thing you think about is the monthly rent or mortgage payment. However, there are other things to take into account with each type of living arrangement: