This very question can put a little fire into the most civil of dinner discussions. Some will tell you that renting is “paying off someone else’s mortgage”, while others tell you that home loans “tie up all your assets”.
But we’re not here to dampen your sail. We’re going to show you why buying and renting houses can both be smart options. And by showing what you stand to gain, we might even prove which option is better for you.
Why You Should Rent
Less Investment Upfront
If you’re looking to rent, the only capital you need is your bond (usually valued at 4 weeks of rent), and your opening rental payment. Sure, you might also have some furniture and lifestyle costs, or other fiddly purchases to make the property suit your needs. But all in all, moving into a rental property doesn’t take much financial input.
Less Ongoing Costs
Even the nicest-looking houses will have hidden little issues from time to time. Maybe a gutter will clog and send off-coloured water down the walls of the house. Maybe a bathroom sink will stop running hot water.
If you’re renting, you can send your landlord a polite message to let them know there’s an issue. Then they end up covering the costs.
No Taxes on Land
Lifelong renters might not even know what “rates” are. But to put it simply, you don’t get an extra annual tax for renting. You do if you own land.
The same property might cost you $450 a week in rent or $650 in mortgage repayments. If saving in the short term is important to you, renting isn’t a bad way to go.
Why You Should Buy
Your House is Truly Yours
Would one wall look about 50x better with a new coat of paint? Do you have the time and drive to do it yourself? If you own, there’s no permission to be sought. There’s no one to ask, and there are no roadblocks. You can do what you like with the place and make it the home you’ve always wanted.
(Some) Tax Benefits
This might also come as a surprise to long-term renters, but you can make some pretty handy claims on your tax return if you’re paying off a mortgage. If you work from home, certain homely expenses can be claimed back on your annual income tax. And if you rent out a room, expenses related to your tenant’s living quarters can also be recovered.
Not everything can be claimed, so if you’re not sure on something, it can’t hurt to seek the advice of a tax accountant.
Why You Should Buy New
Did we tell you there’d be a third option? Whoops, sorry. But this is one option you seriously don’t want to overlook.
Everything You’d Gain from Buying Used
That whole list of benefits for “Why You Should Buy” apply to buying a new home. So that’s a good start.
Less Rolling Repairs
Let’s be honest – some old homes come with more little issues than comforts. If staying on top of your finances is important, a new home is far less likely to cause trouble. And if it does, chances are, warranty periods will apply.
Sure, you can make as many modifications as you like to a house you own. But wouldn’t it be better if the house was designed from the outset to suit your needs? If you buy new, you can spearhead the designs from day 1 and ensure the house you move into completely caters to your lifestyle.
So, what’s the smartest option?
Saying one is categorically smarter than the others is a bit silly. But depending on your circumstances, there’s bound to be one option that’s the best.
If buying new is right for you, take a gander through your nearest Clarendon Homes display village. You can get a feel for what house design suits you best and start your journey towards your forever home.