What is your opinion on Home Buying vs. Renting? A lot of people I talk to say home buying is more worth it because you aren't "throwing away" your money to a landlord. Sometimes I think if I get a mortgage, I'll be "throwing away" money to my broker until about 5 years later where I can start making some decent equity. 

Here's the deal, my husband and I have been married for 5 years. We have lived in 4 different cities and are finally ready to settle down. We love where we live. He has a job as a city planner and will qualify for a senior planner position once he passes his boards in 1.5 years. At that time, if the city he is working for doesn't promote him, we would need to move to get any decent increase in pay.

Our lease is up at the end of April and we are looking around for good rentals. The thing is, if we buy, it wouldn't be much more a month (maybe $100 more). But that means we would be putting it to chance on whether he gets that promotion or not.

If we keep renting, we wouldn't be attached to a home and could move anytime. If we buy, we could start our building equity ... eventually.

This all comes down to what we think is best for our family, but I was curious what you all think! Tell me your experiences with renting vs. buying.

PS. I should say that a home rental we are looking at is $1200/mo plus all utilities. A home of the same caliber would be about $1300/mo plus all utilites. 

Another thing that just kills us is a home in this area just 2 years ago would have gone for 20% less than it is going for now. That spike scares us because we think it could go down just as fast.

Original Post

I agree with Shannon. One thing I've noticed from watching friends and family who opted to buy a home instead of rent is how often a mortgage turns into more of a ball and chain instead of the equity they were promised. People often get offered better jobs in different areas of the country, but because of their mortgage, they find moving to a new place to be almost impossible. If you're not 100% sure you want to be in that home for the entire length of your 15-30 year mortgage, I would hold off for the time being. 

I also saw you posted about considering a tiny home. I mentioned this in a comment on that thread, but I'll mention it in a comment here as well: you may want to consider renting a smaller apartment until you find out whether or not your husband gets his promotion. This will help you adjust to a smaller space (if you do want to go the tiny house route) and help you save money for either a big deposit on your new digs, or a nest egg should you decide to move. Since the promotion is a year and a half away, that's a great standard leasing time. 

Best of luck!

Bonnie Squires posted:

@Kirsten Cherry rite now we are buying this home. We have rented in  the
past. 

The good thing about renting is if some thing breaks down the land lord
has to fix it.

With owner you have to fix every thing your self.

Yes, that is a great point! Our current landlords are awful and we have to fix most things ourselves, but for the major fixes it is nice we don't have to pay for them!

Shannon H posted:

Since you aren't sure you will be there in 5 years, I recommend renting as costs for buying and selling would not be recouped in less than 5 years.  

I agree! We definitely wouldn't move if that were the case. I think I wasn't too clear in my original posting. If we ended up buying, we would stay because of our home purchase, even if my husband didn't get the promotion. 

Are housing prices skyrocketing in your area currently? In the past two years, houses have increased by about 25% here.

Jules posted:

I agree with Shannon. One thing I've noticed from watching friends and family who opted to buy a home instead of rent is how often a mortgage turns into more of a ball and chain instead of the equity they were promised. People often get offered better jobs in different areas of the country, but because of their mortgage, they find moving to a new place to be almost impossible. If you're not 100% sure you want to be in that home for the entire length of your 15-30 year mortgage, I would hold off for the time being. 

I also saw you posted about considering a tiny home. I mentioned this in a comment on that thread, but I'll mention it in a comment here as well: you may want to consider renting a smaller apartment until you find out whether or not your husband gets his promotion. This will help you adjust to a smaller space (if you do want to go the tiny house route) and help you save money for either a big deposit on your new digs, or a nest egg should you decide to move. Since the promotion is a year and a half away, that's a great standard leasing time. 

Best of luck!

Thanks for your reply! I love hearing everyone's input!

I think having a home to call your own would be really nice! Especially since you already know and love the area. I think there is something really special about having a home for your little one to grow up in. You don't have to worry about your losing out on your security deposit when a game of indoor catch makes a ding in the wall. It would also allow you to put personal touches on the home like hanging up photos and painting the walls different colors! I know many of these examples are pretty sentimental but I think they are things that matter, too!  

Renting is just right for me. I don't know how long I'll stay in my neighborhood or city, and renting gives me the peace of mind that if my situation changes, my only hassle is losing my security deposit and whatever other penalty there is for breaking my lease. I've never had to do this, but it's nice to have the option of getting out of dodge if the situation requires. When I renewed my lease most recently I asked my landlord for a few cosmetic upgrades and was allowed to paint the apartment as long as I provided a paint chip for the landlord's reference. And when the water heater crapped out, I had a new one the same day with no cost to me! 

I'm renting now, and have for the last 7 years after a divorce. My ex kept our house. I HATED renting at first, and still do sometimes, because I feel like I'm 'throwing money away'. Then again, there are times I like it, like when my furnace broke while I was out of town at Christmas, and all the pipes froze and burst during a really really cold snap. Also, I can relocate easily. I COULD buy I house, and almost did more than once, but backed out every time because I just don't feel settled where I am, and want the option to easily make changes. 

I guess I didn't really answer your question, this was more like rambling. but those are my thoughts.  

Definitely wait if you aren't sure you want to be there in 5 years. This market is still a little unpredictable and the closing costs etc. are a lot of out of pocket that you won't recoup unless your home really does go up a lot. At which point great! If not then you likely have spent about the same you would have on a rental and without the hassle of home ownership (assuming most rentals cover repairs and things as part of the rental). Not to mention that if you opt for a typical 30 year mortgage you wont' be build equity for a lot of years. On average I think like year 15 is when you start paying down the principal.  Also, here are just some things we have had to pay for since moving in: new roof (unexpected since the roof was JUST replaced in full like 5 years ago), hot water heater thermostat replaced, dryer vent reattached ($100 for that!), lawn care since we don't have time to do it ourselves since we both work...etc. In our case we just bought a year ago and already want to move since we aren't loving the area as much as we hoped. The only good thing we did was to do a 15 year mortgage so our very first payment was paying into the principal. 

Kirsten Cherry posted:

What is your opinion on Home Buying vs. Renting? A lot of people I talk to say home buying is more worth it because you aren't "throwing away" your money to a landlord. Sometimes I think if I get a mortgage, I'll be "throwing away" money to my broker until about 5 years later where I can start making some decent equity. 

Here's the deal, my husband and I have been married for 5 years. We have lived in 4 different cities and are finally ready to settle down. We love where we live. He has a job as a city planner and will qualify for a senior planner position once he passes his boards in 1.5 years. At that time, if the city he is working for doesn't promote him, we would need to move to get any decent increase in pay.

Our lease is up at the end of April and we are looking around for good rentals. The thing is, if we buy, it wouldn't be much more a month (maybe $100 more). But that means we would be putting it to chance on whether he gets that promotion or not.

If we keep renting, we wouldn't be attached to a home and could move anytime. If we buy, we could start our building equity ... eventually.

This all comes down to what we think is best for our family, but I was curious what you all think! Tell me your experiences with renting vs. buying.

PS. I should say that a home rental we are looking at is $1200/mo plus all utilities. A home of the same caliber would be about $1300/mo plus all utilites. 

Another thing that just kills us is a home in this area just 2 years ago would have gone for 20% less than it is going for now. That spike scares us because we think it could go down just as fast.

It is a difficult decision to make. However in your case I think you should look for something rental that will take you through the waiting period (18 months). Although it would be a wise decision to have that money paid to your own mortgage. In the event that you have to move at the end of that period, having a mortgage will tie you down a bit. 

I lived in an apartment building before buying my first house, and yes in dollar the increase was around double that. But it was not all toward the mortgage payment, but also the maintenance. Garden service and renovations etc. So when you buy be sure that's where you're going to be for a long time. Buying a house means making it a home and that's where the real money goes. 

Hope this helps. May it all work out for you.

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