Web Wealth: Buy or rent?
In the housing meltdown, many homeowners found, to their chagrin, that ownership wasn't necessarily a good thing. Is renting any better? It all depends, of course. Here are ways to find out.
In the housing meltdown, many homeowners found, to their chagrin, that ownership wasn't necessarily a good thing. Is renting any better? It all depends, of course. Here are ways to find out.
Rent forever. A site called Bargaineering carries this "devil's advocate" post urging, "rent forever, don't buy a home." The reasoning points are basic. Renting keeps you flexible, lets you off the hook on the costs of repairs, and pretty often means someone else has to mow the lawn. And - by the way - home values can go down. They can go way down, as many sorry buyers now know.
Calculations. Rent-or-buy calculators help you take a look at the specifics of your own life. This one at Bizrate.com steps you through some basics and will quickly eliminate buying as a good option if you have little or no money for that all-important down payment.
Another calculator, at Move.com, asks for numbers. It'll compare a specific rental with a house you may be considering buying. The introduction says the calculator "attempts to forecast the net effects of all the hidden forces so you can make an informed decision."
The loan-guarantee agency Ginnie Mae has a rent-vs.-buy chart.
Buy, and rent. This, of course, is about becoming a landlord. It's hardly for everyone because of the potential headaches of caring for property and dealing with tenants. But if you have the notion to be a landlord, About.com has a short list of how-to tips, such as making sure local rules allow rentals and finding out if the rent you'd need to charge is realistic for the neighborhood.
The Buzz. CNNMoney.com's The Buzz writer Paul La Monica had this recent post giving both sides of the rent-vs.-buy debate. He notes the freedom argument for renting, the American dream argument for buying, and the wait-and-see argument for staying on the home-buying sidelines while the real estate market gets back to some sort of normal.