Your real estate agent may give you an odd look if you say you’d rather rent than buy, but there are some good reasons for choosing to be a tenant rather than a buyer. By Lea Jacobs.
Generally speaking, if you ask an estate agent about the benefits of renting, they give you “the look”. Many agents can’t understand why you’d want to pay a large amount for something you’re never going to own. They may have a point, but here are some examples of when renting, as opposed to buying, may be the best option.
* Potential buyers moving to a new city who want to take time to find the perfect home often choose to rent.
* Those who believe the market isn’t favourable for buying.
* Those who don’t want to be saddled with the maintenance issues associated with home ownership.
* First-time buyers who don’t want to start at the bottom of the property ladder, but would rather wait until they can afford something more upmarket.
* Young executive couples with demanding jobs don’t necessarily have time to look through carpeting and paint swatches or spend weekends scouring nurseries. In the early years they are too busy for the mundane demands of homeownership.
* Financial circumstances often change, and there are many who prefer to rent because they don’t want to be indebted to a bank for something they may no longer be able to afford.
* Those looking to live a lifestyle without paying the full price for the privilege. They may be able to afford the rental on an exclusive estate, but would be hard pressed to pay the deposit and bond if they owned the property.
Maintenance is another reason many choose to rent rather than investing in their own home. The costs of upkeep can be high. While tenants are required to maintain the home to a certain extent, they aren’t generally responsible for the overall upkeep of a home.
But renting offers very little in the way of security. A tenant may find the perfect home, only to be asked to leave once the lease expires. Ask the landlord about future plans before signing a lease.
People who are renting while saving up for something better could find themselves left behind if property prices take off. Tenants often become entrenched in their comfort zones and end up renting for longer than anticipated.
If the experts are to believed, now is a good time to seriously consider buying property. Property prices are pretty stable, the interest rate remains relatively low and the major banks are more amenable to lending. But the fact that South Africa’s credit rating was recently downgraded could put pressure on the Reserve Bank to hike interest rates. Consider this before buying a home.
The bottom line? Renting is a personal choice. Weigh up the pros and the cons, and you’ll be well placed to make an educated decision.
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