One of the scariest things about being a grown up is the constant pressure to own a house. But should we be feeling that pressure?
Baby boomers advise the younger generations to a buy a house, any house, as quickly possible just to get in the market. It doesn’t matter if it’s a tin shed, that’s a good 50 minute drive away from where you work. Just get in the market.
I’m a renter and I constantly have to deal with my parents telling me that I’m burning money. They’ve never rented a home – ever, except when they were building their dream home, and then they hated every second of it. Not being able to drill holes in the walls, having to foster out our pets and freaking out whenever they spilled anything on the carpet.
I’ve been raised to believe that renting should be avoided at all costs but I have to say, renting suits me just fine for my current position and lifestyle. It also suits many other Australians whose lifestyles are supported by being in the renters market. Here’s why.
For some people owning a home and raising a family are top priorities. Settling down and finding a lovely suburb to live in for the next ten years is perfect for that demographic. However there are some people who don’t know where they are going to be next week, let alone next decade, so purchasing a property isn’t a viable option
When you rent, you can accept that overseas job posting of your dreams without the stress of having to find tenants for your house and maintain a property remotely. There’s also the added bonus of not having to pay a mortgage on a house that you aren’t actually living in and paying rates on a property that you haven’t even laid eyes on in years.
Although I’m a renter, I’m surrounded by home owners and I’ve personally witnessed the hidden costs involved in owning a home. A friend of mine recently had to have her heater replaced and consequently ate baked beans for four months afterwards. When you rent, it’s the home owners responsibility to pay for the upkeep of the property.
It’s nice to not have to drop a couple of grand per year on things like curtains, hot water systems and replacing toilet cisterns.
For some people it’s important to live in a trendy suburb that’s walking distance from great bars and excellent cafes, in a city convenient location. In order for these people to buy a flat in a suburb like this, their mortgage could easily be twice what their rent is per week.
They could buy a cheap house in an outer suburb of their city but it would negatively impact on the type of lifestyle that they enjoy. Renting can give people the freedom to live in areas that they can’t afford to buy in.
Everyone in my family are home owners and their emotions seem to be directly connected to the interest rates in Australia.
Whenever there’s an economical crash, they literally see the value leaking out of the house that’s supposed to fund their retirement. While interest rates really do effect everyone, it takes a while for the ill effects of interest rate hikes to reach renters.
People generally buy a house as a way to force saving money, by pouring their funds into a property where they can’t touch it, rather than a bank account where it’s merely a transfer away. It’s often a smart way to nest your funds, but there are high interest bank accounts that can be just as, if not more lucrative than owning a home.
Many experts have argued that depending on interest rates, buyer bonuses and the real estate market, some people might be better off paying rent and popping their extra cash in a high returns investment bank account rather than buying property.
Whether you rent or buy, it’s important that you do what’s right for your own circumstances and your own financial situation. Basically don’t panic. Rent if you need to, buy if you can, don’t over commit yourself and don’t stress about it.
For more information Click Here