Rent vs Buy
Your Dream Home Awaits
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Rent vs Buy | Should you Buy or Rent?
The decision to rent vs buy! Choosing whether to buy a home or lease from a landlord can be a challenging decision. We created this page to help you understand the offerings of each decision so that you make the greatest choice for your situation.
Benefits of Renting
Most of the benefits of being a tenant can be summed up as two points: short-term flexibility and minimal responsibility.
Renting from a landlord offers short-term access to a new city or part of town. If you’re only in the area for a few years, leasing offers a lot more flexibility in the form of annual or semi-annual contracts. It’s the perfect choice for many seasonal South Florida families and students.
Minimal responsibility is also appealing. Owning a home means taking responsibility for the larger details of property upkeep: When appliances stop working or a pipe begins to leak, usually the homeowner covers the cost and works out the logistics of that repair.
Benefits of Buying a Home
Homeownership tends to provide greater benefits to the buyer than leasing offers the tenant.
Firstly, homeownership is an investment. Home values tend to appreciate steadily from year to year, which means you can literally earn money while you sleep.
It also offers some payment security: Tenants don’t know what their room will cost the next year. Paying rent to a landlord who scales what your rent costs annually isn’t unusual, so it can be difficult to achieve long-term financial planning. On the other hand, most homeowners choose a fixed-rate mortgage, which means their monthly payments usually remain consistent over the life of the mortgage.
Owning a home also offers greater autonomy, privacy, and much more. To learn more, see our Buyers page to help you in your decision to rent vs buy.
Closing Costs vs Monthly Rent
Closing Costs vs Monthly Rent: How to Save Money On Living Expenses
Knowing how long you’ll spend in a city is the best indicator of whether you should rent vs buy.
Rent vs Buy – As a general rule:
1-5 years: Rent
5+ years: Buy
After 5 years, most properties will appreciate enough to cover the closing costs of your purchase, making it more financially expedient to buy.
Three distinct financial advantages to owning a home:
- The real estate market: I won’t be the first person to tell you that the real estate market tends to appreciate, but it’s worth mentioning again. Buying a property is one of the greatest ways to grow personal wealth and financially prepare for the future.
- Large, affordable investing: A push-back against the above point might be: “Why should I invest in real estate instead of something like stocks?” Simple answer: your mortgage. A mortgage is a loan that helps you make a large investment that would otherwise be unaffordable. When was the last time you heard of someone taking out a low-interest loan of $250,000 to invest in stocks? It doesn’t happen. A mortgage gives you the opportunity to invest in appreciating assets that would otherwise be out of reach.
- Pay your own taxes, not your landlord’s: A common misconception about paying rent is that you don’t have to worry about paying additional bills like closing costs, annual property taxes, etc. But remember, your landlord runs a business. Good business owners make sure their services cover their overhead. In other words, the price you’re paying for rent likely covers your landlord’s home expenses. When you pay rent, you’re paying someone else’s mortgage, property taxes, and closing costs. Just one more consideration in your rent vs buy dilemma.
Rental Properties – Single Family Homes
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Rental Properties – Condos / Townhomes / Villas
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How to Find the Right South Florida Property
Whether you’re in the market to rent or buy, Chris Donati will connect you to a South Florida property, apartment, or house that matches your unique goals and lifestyle. Contact him today for a consultation and discuss your decision to rent vs buy.