The Age Old Debate – Is It Better To Rent Or To Buy?

 

Why am I renting when the rent just pays for my landlord's mortgage?

If I buy, at least my money goes to my mortgage and I'm busying an asset, right?

Why are real estate investors renting?  Isn't it better to buy?

 

This is the age old debate.  People have been debating this for years.  

Let me start by saying that there's no right or wrong answer.  Is it better to rent or is it better to buy?  Is one better than the other?  

Well… it depends.

What do I mean?

Let me lay out some pros and cons for renting and buying below

RENTING

Pros:  

1. Flexibility:  Similar to leasing a car, you can switch places every year or few years.  You're not locked in to a mortgage.
2. No need for a down payment:  If you're renting, you don't need to save up for a large down payment to buy a place, just need to come up with your monthly rent.  Real estate investors often rent and use their home as an office and claim it as a business expense, then use the money that they would have used as a down payment to invest in real estate deals.  
3. Maintenance:  As a tenant, you're typically not responsible for repairs of fixtures in the property.  

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