Rent or buy real estate - let's have a debate

[Die_empty]

I have been debating about it with couple of my colleagues whether stay on rent or buy a property.

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

I will not even think twice I will go for the loan and buy the property. I spend so much money on rent in my country and if I save my rent for five years, it will be enough to service parts of the loan. Also in my country, the rates or tax on properties is cheap so it will be my best option. Now it can even appreciate in the future which will make you make more money if you want to sell it in the future. Living in my own house will also help me grow some plants and rear some domestic animals in my house. There will be a small garden and cages for fowl and a pond for fish. I will save money on vegetables, eggs, meat, and fish. So my final answer is that I will take the loan to buy a house if my income supports it.

[dunfida]

I have been debating about it with couple of my colleagues whether stay on rent or buy a property.

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

I will not even think twice I will go for the loan and buy the property. I spend so much money on rent in my country and if I save my rent for five years, it will be enough to service parts of the loan. Also in my country, the rates or tax on properties is cheap so it will be my best option. Now it can even appreciate in the future which will make you make more money if you want to sell it in the future. Living in my own house will also help me grow some plants and rear some domestic animals in my house. There will be a small garden and cages for fowl and a pond for fish. I will save money on vegetables, eggs, meat, and fish. So my final answer is that I will take the loan to buy a house if my income supports it.

Same here on which i've been spending for long years now on paying up some rent but didnt really go into the path on taking up some loan or mortgage on owning a house. Why? The rent that i've been paying for a month is less than $100 which it isnt really that something that big on which its something an amount that i could deal with on monthly basis. As much as possible, im trying out to avoid on taking up some loans and would really be living on what i do have. It is really just that pain in the ass on having some loans and other things attached on borrowing.

Im really that contented on what i do have. Yes, its understandable that building a credit score is important because you would really be able to make use of it in the future or would really be something
beneficial but i did really neglect or avoid it out and dont really care. I do prefer on buying everything on the time that i could pay it on cold cash and wont really be taking
some mortgages.

[jossiel]

If your work is on a field and you need to go in many places then of course renting is the best. But I am sure that even if you've got that lifestyle, one day you'll be tired and you're dreaming to have your own real estate so that you won't pay anymore with rent.

And with having no property with being approved by the bank, I am sure that someone who's still young and can afford it will do that. No doubts of taking that potential approval and will buy property.

[Dr.Bitcoin_Strange]

I have been debating about it with couple of my colleagues whether stay on rent or buy a property.

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

It's not wise for someone to live in a rented apartment for their entire life time, buying a house just as you surgest or building one just as I have explained below, should be a better choice. People that are steadily living in rented house, while they can afford their own home might be right in their decision, but to me it's nonsense.


For me, I don't really like loans, but what I will do is to save up money and build my own home. I can just be paying the house rent untill I save up and build my home(I don't breathe well if I am in debt; it's a metaphor.)

Back to the deal: let's assume that the person's salary is enough to take out a bank loan and buy the estate. After buying the house, if it will take him like 5 years before he can finally repay all the debt, it will take him a bit longer to save up money to build his own house in the structure that suits him. Check out my example below.

Mr. A's yearly income is about $30k, and his yearly expenses are about $15k. Let's say he needs to buy a house for about $800,000, and he took a loan of $800 from the bank to buy the house. He will need to repay the loan in about five years with 10% interest. If Mr. A decides to pay the bank $15k every year for the next five years, he should be able to pay the loan.

Second example: If Mr. B wants to build a house for about $900k and his yearly income is also $30k and his yearly expenses (both for the house rent) are $22k, if he decides to save up $8k every year, he should be able to save up the money within ten years. If he starts building the house, there are two things involved: either inflation might have increased the price of his budget and he will spend more than his budget, or the house can take more than one year to finish up furnishing everything in the house. So building the house will take a bit longer. But even at that, if he finally finishes the furnishing of the house, it will reduce his yearly expenses because no rent payment again.

It's usually based on the individual's decision; people should do what they feel will work for them. There are people who don't know how to save, which means they can't save for that long, so such people can go for the loan.

There are also some people who are not good at taking loans, like myself, so they should deciplin themselves to save up and build the house, despite that they will be paying rent till they build their home.

OP, you are very correct, it's better to take the loan and buy the house, than live in a rented house for your entire life.


Cheers 🥂, Dr.Bitcoin_Strange 👺👺

[Captain Corporate]

I think people are missing the point, its not because rent is better than buying, that's not what people who support rent are saying, its that spending the same amount of money on something else would be better. Now, if your case is something like you get a mortgage and bought a house and paying loan back and you wouldn't be able to buy it otherwise, then you never had money, you had a promise of future income, hence you wouldn't be able to spend that money on anything else anyway. However, if you are a wealthy person with enough money to just buy a house, I would rather be in a rented house at that point because I would rather spend that money on whatever made me rich enough to buy a house full in cash, I am sure that would be a better investment. Those are two very different situations.

[ChiBitCTy]

Anyone who just comes out and automatically says you should always own instead of renting should immediately be disqualified as part of any sort of logical, educational discussion , because that type of thinking is straight up wrong.

There's quite a few articles out on the net that discuss the factors of buying versus selling.  Sometimes it's not just so much what one person can afford, but it's also very much about the location.  In some cities/states/countries it simply makes more sense to rent than buy, even if you've got the money to purchase.  


"Ramit Sethi, self-made millionaire and star of Netflix’s “How to Get Rich,” says his “most controversial money opinion” is that homeownership is overrated".

“I’m tired of the blind obsession with homeownership in America,” Sethi tells CNBC Make It.
 - https://www.cnbc.com/2023/05/02/ramit-sethi-why-renting-can-be-better-than-owning-a-home.html

[Uruhara]

With the situation described by the OP, of course buying property is better. even with a loan from the bank. but as long as we are able to repay bank bills. then i guess it will be ok. at least property prices will continue to increase. especially if it is in a strategic area. But this is probably only from my point of view. I don't have much experience with this. but renting is one thing I always avoid when it comes to housing. because the money we pay every month can never make the living space we rent ours someday. and if there is no money to buy it, you can also repay the house and other alternative ways.

But this is only about residential property. but if the property is of another type I have a different and also different view.

[irhact]

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

This changes everything, I was going for rented apartment but when I saw the rent increasing by 15% yearly I got discouraged. If I rent an apartment and it keeps on increasing that means that apartment is a liability to me as it's an expense to me but when I buy that house and it becomes my own and keeps on increasing by 10% owing to the development works then that house becomes an asset.

Buying the house when I have the financial strength to do so will be the best option because after using the house I can always sell and still profits from that as well. If the situation was that nothing happens and there's no increase in rent then I'll rent an apartment become I love traveling.

[freedomgo]

For me, there's no debate on the issue. Buying real estate is always better than renting. I can list my own reasons. First off, it will be yours. That you won't be renting forever is enough reason for me to favor buying your own house.

I was actually happy when I read the book The Richest Man in Babylon and found out that one of the tips mentioned was to "own your home." I couldn't agree more.

You can renovate it freely, adjust the design later on according to your own taste and needs, use it as a collateral for a loan, sell it, and so on. You can do whatever you want with it. It is frustrating to always defer to your landlord on all decisions about the place you're living in.

Moreover, with inflation, what you will be paying in the years to come for your own house will actually be worth less.

I have to agree with this. Buying a property is always an advantage than renting the whole time as your money will only go into waste, knowing in the end you don’t own anything. That is why if you have enough funds to finance buying a real estate, then never hesitate to stick to your plan. It could make you spend huge amount today but after a year or two, if you consider that property to be a source for business, then it’s going to give you high investment returns that may be 10x or 20x from your investment capital.

[Taskford]

I have been debating about it with couple of my colleagues whether stay on rent or buy a property.

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

In my own opinion there nothing to debate this topic because this all depends on a persons need.

We know how expensive the real estate assets on business hub cities compare to province so much better if you rent since you can enjoy all of your time since you will not get drained to travel long hours for you to get home.

You can also buy house and lot even if your budget is tight but expect it will be on province and not near to your workplace. so try to decide depends on your needs since buying an asset is somehow a big obligation to take.

[AicecreaME]

I have been debating about it with couple of my colleagues whether stay on rent or buy a property.

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

Why buy a house using bank loan? I'd rather pay it cash to save money as much as possible.

Having your own place is much cheaper in the long run, no hassle, and you can sleep peacefully at night knowing you don't need to pay rent anymore. Renting is also good if you're still saving some money to buy your own house in the future, but in the long run, I don't think it is a good idea especially if you're not that rich kind of person.

That's only my opinion based on my experience here in our country, I guess the choices would still depends on which country you are from.

[Ultegra134]

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

This changes everything, I was going for rented apartment but when I saw the rent increasing by 15% yearly I got discouraged. If I rent an apartment and it keeps on increasing that means that apartment is a liability to me as it's an expense to me but when I buy that house and it becomes my own and keeps on increasing by 10% owing to the development works then that house becomes an asset.

Buying the house when I have the financial strength to do so will be the best option because after using the house I can always sell and still profits from that as well. If the situation was that nothing happens and there's no increase in rent then I'll rent an apartment become I love traveling.

I believe that a 15% yearly increase is extravagant and not realistic. It might be possible after three years but certainly not after one, although this doesn't change the fact that owning a house is much better than renting.

Personally, there are quite a few parameters to take into account, such as occupation, age, country and place of residence, financial status, and possibly a few more that I've forgotten. Both options have benefits and drawbacks, but owning is ultimately the best solution because renting is practically an inevitable waste of money. You're spending money for your whole lifetime, and in the end, you're not owning anything that you can pass on, rent, or sell. Even if you change places of residence, renting provides a steady source of passive income, and due to the increasing demand for housing, it's almost guaranteed.

The issue is that taking a loan isn't as easy as it sounds. It's a financial burden for over 20 or even 30 years, in which time there's no guarantee that you'll be able to support to pay your mortgage. Thus, especially for someone who's young and just starting out, it's a huge risk to be burdened with a huge debt.

[Etranger]

Why buy a house using bank loan? I'd rather pay it cash to save money as much as possible.

Not every state economic system would let you buy a house without bank loan just using cash. State authorities don’t like cash, because it is not transparent. They don’t know where you got it and how are you going to spend it. Moreover bank loans create a basis for the economy of the country, they provide money circulation and stimulate the economy. For the state, this is much more profitable than if everyone paid in cash and did not apply for loans.

[BitcoinTurk]

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

What's the better option for you and why?

I would prefer the buy option if we assume that I have a budget to pay advance payment. The reason for this is that when renting and buying a house is compared, long-term loan installments are close to or slightly higher than the rental price. Renting a house is only a solution to solve the housing problem and a permanent property is not obtained in case of leaving the house. However, buying a house in installments means having an asset after the debt is completed. Of course, the option to buy may be a bit more costly in the debt payment process compared to the option to rent a house but as I mentioned having an asset after the debt is completed will be a great advantage. Finally, I would like to add a quote that I use frequently on this subject;

"I'm not rich enough to rent a house but I'm poor enough to buy a house."

[Razmirraz]

What if I ask you back, when your financial condition is sufficient to afford a car, will you buy a car or rent it?
Buying has full ownership of the property you bought, you can rent out your property if it is not used to make extra money. While the property that you are renting does not fully belong to you, during the rental period the property is still yours, then you will leave the rental place when you do not continue the lease.
I prefer to buy rather than rent, even though the house or car I buy looks simple, I am the owner of the property.

[Rruchi man]

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

Buying the property is the best option especially since you have the advantage of being able to get under a payment plan. If you continue to stay in a rented place with the rising cost of things, It will difficult to be able to afford getting a property later and paying in full because  the cost for a property is increasing as well as your rent is.

A payment plan can keep you committed for the required duration until the entire loan is settled.

There are many people who have gotten property through this way and have settled the loan and now have full ownership, you will not be the first.

[rat03gopoh]

I believe that a 15% yearly increase is extravagant and not realistic. It might be possible after three years but certainly not after one, although this doesn't change the fact that owning a house is much better than renting.

But sometimes we don't understand what some people think. Especially if they can generate wealth passively, wasting money is their hobby, while the working class will see it from another perspective. Besides that, real setate is one of the investment diversifications which can be said to return slower than some other instruments.
Buying or renting is not up for debate. One may even have a collection of properties for sale and live in a rented house in the same area, while some may even still live with their parents.

[Framelover]

I have been debating about it with couple of my colleagues whether stay on rent or buy a property.

Let's assume, you are well capable enough to buy a new property through bank loan. Your income supports the mortgage payment so banks are willing to lend you money.

What will be the best route to take? Buy the property or stay in a rented place?

The usual appreciation rate of your property value is around 10% owing to the development work that are ongoing. For rented property, your rent increases by 15% every year.

What's the better option for you and why?

The decision should be in line with your financial goals, lifestyle and personal circumstances. Yes, owning a house is prestigious and comfortable, but are you ready for maintenance, repairs, taxations and other responsibilities that comes with owning a house?
Nevertheless, what is your financial strength? Does your income constantly support the mortgage payment? If so, buying a property can be a good longterm investment.

[demonica]

Renting is expensive if you compute the accumulated expense you'll have. Having your own property might be expensive at first but it's more practical over time. If it's possible with the money you have or the amount you can loan, it's better to purchase a property and make it available for renting. Then you can use the money you earn from it to pay for the remaining balance on your bought property. For me, it's okay to get a loan to buy a property if it'll be used to earn income. Because it's more expensive to get a loan to buy something that won't bring you income. Maybe after some time, you can save up enough money from that passive income to buy another property.

[ElmedoRator]

I would rather rent a house than take out a loan through a mortgage. Renting allows you to avoid the financial burden of high-interest bank loans and offers flexibility in choosing properties strategically located to save time and fit your lifestyle. your. Furthermore, if you decide to buy a home, buying it with cash can be a wise financial decision. This will avoid mortgage-related interest, save you money in the long run, and potentially give you a higher return on investment.