Buy or rent property: Which is better?
Continue paying rent every month or dare to take the step of investing in a home of your own? Every tenant asks himself this question at some point, at the latest after another rent increase. But at what point is it worth buying instead of renting? For whom is it profitable to buy a property and what is the right time to take this decisive step? Read on to find out what the advantages and disadvantages of renting and buying property are. We will help you make an informed decision so that you are optimally satisfied with your rental flat or your own home!
Is buying a house worthwhile in the long term?
It is not possible to make a general statement about whether buying a house is worthwhile. As you will see in the following, a number of factors play a role in the decision for or against buying a house. Not only should financial resources and developments in the real estate market be taken into account, but also personal factors. So you should weigh all factors thoroughly before making a decision. In principle, however, it can be said that in most cases buying a property will pay off in the long run, as the purchase price will be cheaper than renting in the long term.
Buy or rent: Developments in the real estate marke
When considering whether it makes sense to buy or rent, one must always take a look at the current developments in the real estate market and forecasts.
It is becoming increasingly difficult for Germans to afford their own home. Although construction interest rates are still relatively moderate, they have increased significantly compared to previous years. As a result, loans are more costly. Inflation also adds to the financial burden.
Accordingly, it can be said that for some time now fewer and fewer people have been asking themselves whether they want to buy or rent, because they usually have no alternative. However, it should be said that rents are also becoming more expensive.
Price developments on the German real estate market fluctuate again and again. Thus, price reductions can be expected again in the future. It is therefore advisable to wait until the right time to buy a property. In this way, it will also be possible for people with a lower income to purchase property.
It is also advisable to keep an eye on the price level if you want to estimate what increases in value you can expect for your purchase property
Which is better: buying or renting?
When it comes to weighing up for oneself whether buying or renting is better, one should not only look at property prices and rents. It is advisable to look inside yourself and assess your personal situation. There is no one-size-fits-all answer to the question “buy or rent?
Flexibility
Deciding to buy your own home also means giving up some flexibility with regard to where you live. Once you have bought a house, you usually plan to stay in the same place for a longer period of time and not to move directly to another city. With a rented flat with a short notice period, on the other hand, you have the option of moving more easily. So you should be clear about whether you are willing to stay in one place for a longer period of time. Even with an addition to the family, you are more flexible with rentals at first.
Independence
While the flexibility aspect speaks more in favour of renting, you are more independent with a home of your own. When renting, you have to be considerate of rules and abide by the house rules. In your own home, however, you can confidently keep pets or make alterations.
Garden maintenance
This point depends entirely on your individual living situation. However, one can tend to say that in a home of one’s own, more garden maintenance is needed on your part, whereas in a rented flat, the landlord usually takes care of the maintenance of the communal garden or green space. Having your own green space, however, not only comes with more responsibility, but also, of course, greater design freedom. So it’s all a question of your own preferences!
Maintenance and repairs
New owners should not underestimate the costs of repairs and maintenance. With the purchase of your own property, you are also very likely to incur high ancillary costs. Whether it’s a broken water pipe or a leaky window – usually the landlord will take care of repairing the damage. You have to pay for the costs yourself if you own your own home.
Modernisation and refurbishment
If you decide to buy a house, you can be sure that you can adapt your home according to your own wishes. Whether you want to move walls or renovate your house to make it more energy-efficient: all of this is easily possible, whereas as a tenant you have to comply with the landlord’s specifications.
So when is it worth buying a property?
As already mentioned, the question cannot be answered without looking at the individual circumstances. Due to the numerous specificities associated with renting or buying, the choice between the two options can be difficult.
The stable investment in value that an owner-occupied home represents contrasts with the possibly undesirable tying up of assets and the need for a high level of equity to finance it
In the case of a rented flat, the relatively low monthly burden can initially be seen as an advantage. Disadvantages include rent increases or limited freedom of design.
Would you like to explore the question of whether renting or buying is worthwhile for you with professional advice from our real estate experts? Contact us!
