Some people, such as Ramit at I Will Teach You to Be Rich, go on and on about how renting is the best way to go for most of us. Others say that renting is throwing money away. Few people, though, have a real tool to tell you which is best for you.
I’m not saying it’s never better to rent than buy, nor am I saying it’s better to always buy than rent. I’m saying you need to do the research and you should understand that multiple variables are going to come into play. Such as:
- Length of time you’ll be in the home.
- Total cost of home
- Monthly mortgage payment vs. monthly rent payment.
- True cost of home ownership (taxes, insurance, maintenance, etc.) vs. maintenance free living as a renter.
- Percent decline of home from real estate bubble prices (not a factor in non bubble locations).
Follow his advice and make your way to the New York Times the next time you are looking at renewing your lease or if you are on the verge of a home purchase.
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