I recognize the benefit of renting a space to live in, especially right after college when you don’t have much money. When should you start to consider buying a place, though? Beyond intuitive reasons such as not being settled down permanently in a location, what are reasons for renting over buying if you can afford to buy a place?

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Posted by Michael Drougas (MONEY FORUMS: 4, Answers: 0)
Asked on April 27, 2016 9:04 pm
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Hi! So glad you wrote! This answer is not as absolute an answer than if you had written, for example, “When is my income tax return due?”, but I will tell you my thinking about this decision.

You pointed out that being relatively sure you are not going to stay in one place for a few years is one good reason to rent rather than buy. Some other reasons you might want to rent:

-Unsure about job status and worried you might be laid off
-Unsure about job status because you think you’ll be promoted soon
-Not set with your significant other – either have one you aren’t sure about or are hoping to find someone
-Don’t really like the area you’re currently living in – everyone says you “should love it,” but you just don’t
-High school loan debt or bad FICO score that might cause you to get a higher than normal mortgage loan rate
-Don’t want to be tied down
-Don’t want to deal with maintenance, repair, decorating, yardwork, etc.
-Don’t want to have to pay real estate taxes if you are in an area that has high taxes
-A parent or sibling is not doing well and there is a chance you may need to move nearer to them to help them

Those are some key reasons why renting might be better than buying at certain times in your life can be better than buying even when “common sense” says buy. I hope this help! Best wishes to you in whatever you decide!

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Posted by Kathryn Hauer (MONEY FORUMS: 0, Answers: 18)
Answered: April 28, 2016 2:12 pm
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There are several things to consider Michael. Beyond wanting to be in the place several years (early days of a mortgage you are paying lots of interest and not building equity as quickly). Remember that owning a home means paying property taxes and homeowner’s insurance (many multiples of renter’s insurance), and you are responsible for ALL maintenance. The last item means you need to have a much bigger emergency fund. If you think you can manage those additional expenses, and if you are in a hot rental market in case you need to move in a hurry, you might consider buying a place.

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Posted by Beth Tallman (MONEY FORUMS: 1, Answers: 61)
Answered: April 28, 2016 2:08 pm