One of the most common questions that REALTORS are asked is should I buy or rent? The answer depends on many factors. What is your ultimate objective? Are you planning to be in Northwest Arkansas temporarily? Do you like the NWArk area enough to make it your home? What is your financial situation? Are you planning to settle down into family life? These are big questions that must be answered before the decision is made. That said, let’s take a look at both options.
Renting: There are many advantages to renting. It is a great option for those with a fear of commitment, flexible employment, or changing family situations. If you know your job is unstable or you are moving out of the NWA area, there is no question – renting is the way to go. It has less upfront expense and short term risk, but over the long term can have downsides with respect to a home purchase.
Buying: Although it may seem surprising, buying a house is often the right financial decision. There have been many studies that compare buying versus renting a home and there are calculators on the internet that will give you insight into your particular situation. A study done by the National Association of Realtors compared the costs for a renter and a homeowner over a seven year period and concluded that after 6 years the homeowner’s payment would be lower than the renter’s monthly payment. This decreases to 3 years when the tax savings of home ownership are included. An additional benefit of paying for the mortgage on your property is that it puts you in a habit of saving, enabling you to build equity for yourself. Those who own real estate typically build more net worth than those who rent. For many people owning a house keeps them grounded and brings stability to their life. Owning your own home is after all the greatest American Dream.