Particularly for millennials, the question of whether to own or to rent a home presents a conundrum. Home ownership has long offered stability and a chance to recoup your investment while renting lets landlords take on the burden of repairs and allows for easier moves.
So, which is better? As with most real estate concerns, it depends on your situation and location.
How Long Do You Want To Stay?
If you’re planning on living somewhere for under five years, renting may be the best option. You don’t have to take on the extra burden of a home, and you can make your plans for relocation well in advance. When you own a home, there is no guarantee that you’ll sell your house before you move, so you’ll end up paying for it even when not living there. If you are in a growing housing market like Riverside County, the longer you stay, the likelier it is you’ll sell your house for more.
That being said, in busy markets, you may be able to resell your house faster due to heightened demand – for example, inventory ratesfor real estate in Orange County have remained low, making quicker sales possible
How Hands On Do You Want To Be?
Owning a home means a willingness to get your hands dirty and do some of the work yourself. If you have to pay someone to handle even the smallest repairs, your home cost will keep going up. When you rent, your landlord or management company will take care of your needs. However, you may end up waiting or unable to choose replacements.
How Are Your Finances?
If you have the cash available to pay for real estate in Corona, you probably don’t need to read on. But if you’re looking at real estate in Los Angeles County and you’ll need a mortgage, your finances will need to be in good shape. Most lenders will require a credit score over 620 for a conventional loan, and you’ll need a down payment of 20% unless you get a loan through a special program.
When renting, you’ll probably need to pay first and last month’s rent and a security deposit, however, that number will be significantly lower than a down payment. Plus, you can count on your deposit being returned if you treat your rental the same way you would your home.