When it comes to making your own home, you must choose between two basic options as far as a residence is concerned. Either you own the home you live in outright, usually by securing a loan in the form of a mortgage, or you rent.
Both of these options are open for any type of home, whether you are considering setting up in luxury condos or a nice Victorian home. The problem many people face when it comes to choosing between renting or a mortgage payment is one of finances; they have to ask which is more feasible, given their financial picture. Let's take a look at some of the things you should consider when it comes to deciding between renting or taking out a mortgage.
With a mortgage, you own your home outright. Once you secure a mortgage and buy your home, that home is yours outright. It's counted among your assets and when you sell it, the money left after you pay off the mortgage is yours. No more giving money to people for no permanent gain.
Renting is more flexible. Renting is good for people who have not yet decided upon a career or other lifestyle options, simply because you can walk away from rent if your circumstances change. One month, you could be making industrial products and living alone and the next you could take on a roommate and starting a business. You don't have this flexibility with a mortgage; you must make those payments monthly or risk long term financial trouble.
Rents go up, mortgages don't. Once you buy a house, the price you paid is fixed. Your mortgage payments may fluctuate depending on the interest rates, but they won't reflect the market. Renting, on the other hand, may mean that your rates go up simply because the real estate around you is more valuable. This is especially true with growing communities.
Keep your improvements to yourself. When you rent a property, any changes you make (if you are allowed) will be to the benefit of the property owner. Renovations and improvements on your own house, purchased through a mortgage, will be to your own benefit. But, that also means when you need a new piece of furniture, it's your responsibility to buy one and get it installed!
The biggest difference between mortgages and renting is the degree of permanence that separates the two. Renting leaves more room for flexibility, but mortgages mean you are paying money on a real investment. If financial and lifestyle circumstances allow it, paying for your own home is always better than giving money away every month, whether it's for a Vancouver condo or one of the gorgeous homes on the beach.