Most people dream of owning their own home and for good reason. Freehold real estate is one of the few things in life that lasts forever. You pay for it knowing the property can be passed down for generations to come. And if you ever want sell, you should be able to make a nice profit on your investment.
However, buying a home doesnâ€™t always make sense. Property maybe forever, but life can change in the blink of an eye. That means it makes more sense to rent a residence and postpone home ownership until a more suitable time. Here are three times when it is better to rent than buy a home.
Starting a new job
Starting a new job is an exciting experience. And if your new office is far away from your current home, it might make sense to move. Many new employees decide to buy a condo or house close to their new workplace. Unfortunately, this is an extremely short-sided move.
What happens if you donâ€™t like the job and quit in a few months? What would you do if something happens to the company? You wonâ€™t be able to answer these questions until after you have worked there for a few months. If you buy a home close to the office and something happens, you will be stuck with it. That wonâ€™t be a problem if you can find a new position close by, but life doesnâ€™t always work like that.
If you want to live closer to your new job, it is a good idea to find a place to rent for the first six months to a year of employment. This will give you enough time to see if you like the company and your role. If everything is still looking good after this time, then start your house hunting.
The years directly after graduation from university can be a whirlwind. There will be any number of life changing events that may make owning property difficult. New jobs, marriage and travel opportunities could be in the cards. While property ownership is important, do not rush into it right after graduation. Take your time, live a little and be a renter. When the time finally comes to buy a home, you will know.
You donâ€™t have the savings for a down payment
It is important not to entirely deplete your savings account in order to make a down payment on the condo or house youâ€™ve been looking at. This will leave you in a vulnerable position should an emergency take place.
See more: Ways to save for a down payment
It is better to rent and budget your money accordingly until you have enough to make a down payment without completely emptying your bank account. While it isnâ€™t ideal, especially if you already have a property lined up, doing this is a prudent decision.