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2/21/2023

Rent or Buy? That is the Question...

Like many growing cities, Olympia has numerous options for renting or buying a home. But the cost of housing in cities like Olympia is on the rise, and it can be intimidating to consider buying a home. Renting an apartment or house can be an attractive option, particularly for those who prefer the flexibility that renting offers. But is it really the right decision for you? In this blog post, we’ll explore the pros and cons of renting vs buying to help you make an informed decision about your living situation.

The Case for Buying

However, if you're looking for an investment opportunity, then renting isn't it. Homeownership provides an increase in equity over time as mortgage payments reduce principal amounts while property values appreciate. Plus, homeownership can lead to tax deductions such as home loan interest deductions and property tax credits.

In a good market, the value of your home may increase, giving you long-term financial stability should you need it. Even in a down market, your home has a tendency to remain the most valuable asset you have in your financial portfolio.

Unlike renting a home, you have full control over what you do with the home you’ve purchased. You can upgrade appliances, repaint the inside and outside, and change flooring and landscaping whenever you desire. While some homes fall under the rules of a homeowner association, owning a home allows you the flexibility to make your home feel more like yours.

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The Case for Renting

On the plus side, renting may provide greater flexibility than buying – when your lease is up, you can move without worrying about selling a home or taking on the costs associated with owning property. In addition, renters have fewer maintenance responsibilities compared to homeowners, which comes as a relief for anyone who doesn’t have time to keep up with repairs or landscaping.

If you’re younger, or an individual in the military, the long-term commitment of buying a home may not be the right option for you. Renting can establish a good history of making regular payments on time, bolstering your attractiveness as a buyer when you’re ready to dive into the housing market, and short-term lease agreements make it easier for you to be able to move when the time comes.

Even though rental prices have increased over the last two years, it still may cost less to lease an apartment or condo than it would to purchase a home. Unlike owning a home, you are not directly charged with real estate taxes. You also would have lower insurance costs, and depending on your agreement with your landlord, you may also not incur utility costs while renting.

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It’s a Personal Decision

When it comes down to it, deciding whether or not to rent or buy depends largely on one's individual financial and lifestyle needs. Those who don't have a steady income or credit score might find it easier and less risky to rent than buy initially but eventually plan on transitioning into ownership when their finances are more stable. On the other hand, those with good credit scores might think twice before getting stuck in rent payments indefinitely if they know they can afford to purchase a property after doing their research and crunching numbers carefully.

Ultimately, exploring both sides of this debate will give you a better understanding of what works best for your individual situation - so make sure you do your homework before making any decisions!

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