For many retirees, downsizing is not always an option. It becomes necessary, especially if lack of funds is a major issue. Downsizing, for the most part, can stretch money and savings at the end zone of retirement. It can also bring the added benefit of reducing maintenance requirements in a spacious property.
If you own five- or a three-bedroom family home, downsizing is necessary. When you have decided to move to a smaller space, you also need to decide whether to buy or rent. Renting an apartment or house can be challenging, especially if you’re a long-time homeowner. Buying a new house, on the other hand, can be a lot more expensive.
Factors to Consider
Bonneville Multifamily Capital says there are factors to consider when deciding whether to rent or buy. It is important to evaluate the relative home prices and annual rents in different communities. You may also need to estimate your cash-flow needs and make assumptions or estimation for rent hike, investment growth, and home maintenance cost. You may also need to think about emotional and non-financial issues.
The Flexible Choice
If budget is a problem, you may want to go with renting, as it is more flexible than buying. There are also plenty of benefits like moving without a hassle and giving you enough time to confirm your decision. One of the major advantages is that you don’t have to worry about mortgage payments and the long process of home loan application.
Be at Home
While it is true the renting has many benefits, you shouldn’t disregard buying right away. If you’re planning to sell your house, you can use the money to buy a smaller one. Owning a house also eliminates that feeling of throwing money out the window. There is also the benefit of customizing your abode or doing whatever it is you feel like doing. You may also get to enjoy price appreciation the house gains over time, assuming that you’ll stay long enough to cover closing costs.
Weigh your options before deciding between renting and buying. If you decide to buy, be sure to get help from reputable real estate lenders and explore ideal mortgage programs and deals available.