Is It Better to Rent or Buy Your Home? it’s an important subject to discuss as some people ask me which is simply better.
Pros and cons:
There are pros and cons to both renting and buying your own home. It really depends on your personal circumstances as to which option is best for you. Some people prefer the flexibility that comes with renting, while others feel more secure owning their own home.Renting
Renting your home has a number of advantages. For one, it can be much cheaper than buying a home, especially if you’re not ready to commit to a long-term mortgage. Renting also gives you the flexibility to move around more easily, since you’re not tied down to one property.
However, there are also some disadvantages to renting. For example, you may not have as much control over your living situation, since your landlord could decide to sell the property or raise the rent at any time. Additionally, unless you’re careful with your money, it can be easy to fall behind on rent payments.
Buying your own home
Buying your own home is a big investment, but it comes with a number of advantages. For one, you’ll have complete control over your living situation – no landlords or rental agreements to worry about. Additionally, owning your own home can be a good investment, as your property is likely to increase in value over time.
However, there are also some disadvantages to buying your own home. For one, it’s a much bigger financial commitment than renting, so you’ll need to be sure you’re in a good financial situation before taking the plunge. Additionally, if something goes wrong with your property – like a burst pipe or a broken window – it will be up to you to pay for the repairs.
So, Is It Better to Rent or Buy Your Home? Ultimately, it depends on your personal circumstances. If you’re not ready to commit to a long-term mortgage, or if you like the flexibility of being able to move around more easily, then renting might be the best option for you. However, if you’re in a good financial situation and you’re looking for a long-term investment, then buying your own home could be the right choice.
Lets look at cost to rent vs cost of mortgage to get a better understanding of which might suit you better and the key considerations you need to make when you are thinking about taking the plunge into home ownership.
Calculation
The average rent in Melbourne per week is $660 for houses according to multiple online searches. That means that the monthly cost to rent a house in Melbourne is $2860. To get to this calculation we simply take the weekly rental figure (which in this case is $660) and multiply that by 52 weeks in the year, then divide that by 12 months. So the average monthly cost of rent = is $660×52/12.
This is indeed interesting as right now if you are a first home buyer and have access to the FHLDS or FHB grant, you could buy a $550,000 house and have a home loan repayment of $2,659.86 (based on 95% lend, no LMI, no stamp duty, and a rate of 4.54%*). Of course, you would still need to have the 5% required to buy your own home however, it has never been easier to get into your own home right now, even with rates exploding at an astronomical pace.
Is It Better to Rent or Buy Your Home? Therefore, if you are looking at getting into the property market and have a modest salary, now is a great time to buy your first house as we don’t know if the current government assistance will be around next year.
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