What’s Best – to Rent or to Buy?
Rising interest rates are making it more and more difficult for South Africans to buy a home. However, renting in the long term also has a financial impact.
You need to consider these 3 points when comparing renting to buying:
- Think long term.
Consider whether you see yourself renting or owning your own home in 7 to 10 years’ time. This will help you to plan and work out whether you’ll be able to afford a home, if you wish to buy.
Buying a home offers more security in the long term, as you do not have to answer to landlords and leasing agents.
If you are renting and the owner of the home decides to sell, you may have to move. Living in your own home gives you more freedom than having to answer to third parties.
- Does buying offer you a return on investment?
Property is likely to increase in value over the long term – 10 to 15 years.
So if you buy, you have an opportunity to make a return on this investment. You may also be able to rent out your property and use the rental to help pay off your bond.
However, when you rent a property, most rental agreements don’t allow you to sub-let.
- Your home gives you freedom of choice.
When you’re renting, you will need written consent from the owner to change anything in the property.
When you own your own home, you can decide whether to renovate or build on to the existing property. You will, of course, need to get approval from the council.
