I recently worked with a client who was torn between buying or renting. We had a long talk and I set out the following Pros And Cons to the question of renting.
1. Rent is Something for Something: I wonder when I hear people say that they gave all their money to the landlord for nothing. What? Did they live on the street? No, of course not. They got shelter for their rent money.
2. No Equity Build-up: What Renters are really saying is that, after paying for their shelter, there was no equity built into the payments. In some ways it is like leasing a car. You can use it during the lease but are unlikely to own it after the lease expires. Given the current declining market in some areas, renting would have left more money in the renter's pocket than buying. This is rarely the case but it is possible.
3. Mobility: On the positive side - you get the freedom to change or move locations after the lease expires. You have increased mobility. Six months, one year, two years and vroom - you are out of there. This is particularly good for people moving to Ottawa or any new city and not sure where they want to live.
4. Almost worry free: As a renter, you are unlikely to be responsible for maintenance of the premises. If the roof caves in, call the landlord. If the hot water tank blows, call the landlord. Snow on the sidewalks and in the parking lot, call the landlord.
5. The Right Neighbourhood: As a renter, you may be able to move into neighbourhoods that you would not normally be able to afford if you were buying. One affordable way to live downtown or in Ottawa's Byward Market is to rent.
6. Costs: Sometimes renting is the only option when you do not have sufficient funds available to buy a house (all the upfront costs may total more than you have available). It is easier to budget when you rent. There are not a lot of unexpected costs. In fact, when starting out, many people rent very cheap accommodations in order to build up a fund so that they can buy a home at a later date.
Would you need a real estate agent to help you find rental accommodations? Not normally. If you look at the ads in the paper, on the internet and the local renting magazines, you are likely to find an apartment or town house suitable for your needs. If, however, you would like to rent a condo or a house, the owner may have listed the rental on the MLS® through a real estate company. If you would like to be dealing directly with an owner during your rental period then calling an agent will help you work through the process of renting these types of accommodations.
Weigh the pros and cons before signing the lease.
Photo Credit: Unfurnished Apt for Rent
