Posted by Admin on June, 22, 2019
re you perplexed between owning a home or living on rent? Read on below to know the pros and cons of owning a home v/s living on rent.
A common dilemma that most city-dwellers face is the one that pertains to owning a home versus living on rent. While some advocate that living on rent costs less, at least in the short term, it has been seen that property ownership comes with a host of advantages. Experts recommend that if you have the funds and loan options to support a home purchase, then it is highly advantageous to make that investment.
Here’s why owning a home is a better choice when compared with living on rent, especially in the long term.
1. Buying a home might seem like the more expensive choice at the outset; however, rental costs add up to a large amount in the long run and cannot be recovered in any way.
2. With the passage of time, rentals go up but the home loan EMI remains the same. When you sign up for the home loan, you know exactly how much you will be paying towards the EMI for the entire loan tenure, which allows for better financial planning and stability (as compared with unpredictable rentals).
3. As a tenant, you are largely at the mercy of the landlord. The landlord can ask you to vacate the property at short notice, bringing in another element of unpredictability into your life. As a homeowner, you can enjoy a sense of security, stability and pride, with no interference from any other party.
4. As a homeowner, you can gain Return on Investments (ROI) in two ways—through rental income as well as through capital appreciation. The rental can serve as an immediate source of additional income. This, of course, is not the case when you are living on rent. The rent that you pay every month cannot be recovered in any way.
5. Finally, as a homeowner, you can mortgage the self-owned property to enable other purchases. As a home renter, you do not have this privilege.
It can easily be illustrated with any example that the cost of living in a rented home for a long period of time is much higher than the cost of living in one’s own home. This is, of course, discounting the other hassles that come with living in rented accommodation. At the same time, the capital value of your home continues to increase in the case of a self-owned property. From the long-term perspective, it is always recommended that one invest in a home of one’s own.
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