Should you rent or should you buy? Naturally, the de facto answer from an ex-real estate agent would be, "You should buy". But an answer from an everyday human being is, "Home buying isn't for everyone." While the fiscal benefits of homeownership are undisputable, there are some folks who are better off renting. However, you are in control of whether or not you are a renter or a buyer. If you want to figure out the right answer to the rent or buy question, as it stands for you right now, take a look at a my top four self-evaluation questions.
Are you handy?
Landlords handle repairs and maintenance for you, homeowners handle their own, or hire someone. Homes require regular hands on maintenance and repair. As such, handy people generally do better as homeowners. If you don't know a circular saw from a screwdriver, you might be better served as a renter -- or at least buying a home warranty policy.
Are you saver or a spender?
Because owning a home comes with regular costs and lofty expenses (mortgage, insurance, property taxes and upkeep), savers are usually better equipped to keep up with the financial demands of owning a home. Renters, on the other hand, only need to worry about making the rent payment each month -- since the landlord does the maintenance and foots the rest of the bill and the worry. In short, savers are better suited to buy houses, and spenders are probably better suited to rent.
How's your credit?
Even though today's mortgage rates are at astonishing lows, lending standards remain tight. If your credit score is below 620, home ownership isn't in the cards right now. However, if your score is 620 or above, you are a saver and know your way around a screwdriver, house hunting you should go.
What's your job situation?
If your job requires you to relocated every couple of years, buying a house might not be the best investment. That is, unless you have over 20 percent to put down on each house you buy. If you have been in the same place for 10 years and have no intention of moving, buying a home should become a consideration, if you meet the other criteria.
What's the Verdict?
The nice thing about deciding whether or not to buy a home is that you can always change certain elements of your life (and your spending habits) to conform to homeownership standards. On the flip side, if you've tried out owning a home and it's not for you, you can always go back to renting. There isn't a one size fits all solution, and the one thing you need to always remember about personal finance is that it is just that: personal. Ask the right questions to make the right financial choices for your budget, your habits and your lifestyle, not someone else's.
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