There was a time when the decision between buying your own home or renting was based solely on what your budget allowed. Today, there are many valid reasons why even people who can afford a new house choose to rent instead.
There are pros and cons to both renting and purchasing; the decision boils down to both affordability and personal preference.
Why You Should Buy
Home ownership is a serious commitment. One of the biggest advantages of owning your own house is having property that increases in value. If a time comes when you decide to either upgrade to a bigger home or have to move because of work, you can always rent out your house for a profit while also being able to keep up with your mortgage payments.
Of course, there’s always the option to sell your house. And because Seattle property is in demand at the moment, it shouldn’t be that difficult to find a buyer for your home. If you’ve made any renovations, you might even turn a profit.
Purchase a home if you’re prepared for upfront and closing costs. Buying and owning a home means being prepared with a down payment upfront. For example, if you’re planning on buying a house in Beacon Hill for $574,000, you’re looking at a minimum down payment of about $20,090. This means that your monthly mortgage payment is $2,997. If you’re earning well above that amount and mortgage payments aren’t a major concern for you because your job offers stability, home ownership isn’t so risky.
Why You Should Rent
One of the biggest advantages of renting is flexibility. As a tenant, you can relocate from home to home. Seattle has a lot of wonderful neighborhoods to choose from. You could easily move to another neighborhood and into a new house or apartment once your lease is up. It’s ideal for people who don’t want to be tied down to one place for too long.
When you rent, you don’t have to worry about a portion of your wealth being tied up in a single asset. With the unpredictability of the market that threatens some industries and jobs, it can be scary to suddenly find yourself unable to make your mortgage payments. We hear stories every day of people losing their homes when they can no longer afford them due to an economic slump and mass layoffs.
Earlier, we mentioned purchasing a house in Beacon Hill. The median rent in neighborhoods like Beacon Hill is $2,461. That is significantly less than what your monthly amortization would be if you had purchased the home worth $574,000. However, unlike a mortgage, you’re not putting money into a property you will ultimately own when you are paying rent. Essentially, you are paying that amount simply to live there month to month.
However, now is also a good time to be a renter in Seattle as rents are dropping significantly for the first time in a decade as Seattle’s hottest neighborhoods are flooded with empty apartments in newly constructed buildings.
Ultimately, the choice is up to you. Whether you decide to be a proud homeowner or a satisfied renter in Seattle, you still enjoy living in one of the best cities in the country.