SHOULD A COLLEGE STUDENT OR RECENT GRAD BUY A HOUSE?
Getting a student ready for college or the real world after graduation can be quite stressful. Housing is always a major factor to consider. Should they buy or rent? We know that coming back home to live with parents is not what anyone wants! There are many factors to consider and there isn’t a simple black or white answer that fits for everyone. There are too many variables for that. It’s best to make a list of Pros and Cons and weigh out the balance for you to decide. Here are some facts about both Buying and Renting to help!
The Benefits Of Renting
- Renting doesn’t need much equity, since all you have to do is identify an apartment that suits your needs, contact the agent and move in once you’ve paid your deposit and signed the papers. This is cost-effective, especially if you’re in college and don’t have access to large amounts of money.
- Renting also gives you the peace of mind in knowing that should anything happen to your apartment, you’ll have the freedom to up and leave. If you buy a house and have it destroyed due to a hurricane or fire, you may have to start from scratch, something that’s not so easy if you’re young and in college.
- Renting saves you a lot of money in the form of maintenance and repairs. This is because it’s the landlord’s responsibility to fix that broken pipe or make sure that the grass is cut every so often. If you decide to buy a house, the amount you will spend maintaining your property will add up over the years. This could’ve been money you could’ve used for other types of investments or put down as part of your retirement fund.
- Renting may also help if you don’t want to be tied down at a particular location for extended periods of time. If, for instance, you have a 1-year lease and decide to move to Costa Rica once it expires, nobody can stop you. Buying a house will mean that you won’t have this kind of flexibility since you’ll be stuck in one place, forced to keep making payments as well as take care of the house for extended periods of time.
Now lets look at buying
The Benefits of Buying a House
- Buying would make more sense in case you’re looking to start a family. You’ll have the stability that comes with knowing that you own your home as well as a sense of community especially if you buy in a family-orientated estate or county.
- Buying a home will eventually free you from making mortgage payments. This basically means that you’ll be home free after a certain amount of time has elapsed compared to renting which will have you making checks out to your landlord for an indefinite amount of time.
- Owning a house is a good idea if you want to have more autonomy and control when it comes to home improvement projects. You’ll be free to decorate whichever way you see fit, and you can make as many changes as you’d like. In fact, the value of your home will increase over the years provided your home improvement projects are done well and add more quality and comfort to its occupants.
- You can also rent to roommates that live with you, which could offset some or all of the mortgage and other expenses. Some of the millionaires we’ve interviewed followed this strategy to get a leg up in college.
- Even if you decide not to stay in your home for long periods of time, you can still make money off it to help pay for the mortgage. For instance, if you don’t want to be tied down to a home and want to travel for a couple of years first, you can opt to rent it out at a price that’s slightly higher than your mortgage amount. This way, you’ll have an income stream as well as be able to pay off your mortgage in a convenient way.
- Buying will also give you access to tax credits which can offset the cost of buying your home. All you have to do is make sure to itemize property-related expenses when filling in your tax return.
- Buying a house gives you security that renting can’t provide. Should your income remain the same over a long period of time, you can automate your mortgage payments, giving you stability and the confidence in knowing that you’ve got accommodation sorted for the better part of the future.
Here at Metro First Realty, we hope that these facts have been helpful. Please reach out to us if you still need help making plans for your student or grad.