This is one of those arguments that will never be resolved. Depending on the asset or object, some people will argue in favour of buying whilst others will emphasise that renting is the better solution. This will depend on what one is discussing and an individual’s personal situation, so in reality the decision is never really clear-cut.
When it comes to discussing property, this varies depending on one’s outlook, financial position and even country. In a country such as Malta, locals would typically be more in favour of buying rather than renting when it comes to property. In this regard, it is quite normal for young individuals in Malta to seek to buy a home rather than rent their first property. In other countries such as the UK, the common practice is that one would rent his or her first home.
So what are the benefits of buying?
The main benefit of buying is that the asset would become yours and will contribute to your net worth. If you would opt to sell that asset, you can do so at a better price than which you bought. Buying provides a sense of ownership which cannot be replaced through rent. Buying automatically implies further commitment towards the asset and a sense of permanence.
Some people will dilute the benefits of renting, however it does hold its own advantages. Renting allows for short-term commitment where if you are no longer happy with the property you are residing in, you can change far easier than if you are the owner. The expenses related to renting are easier to control as you can always seek a cheaper option if finances are tight. If you have an existing mortgage, the repayment is likely to remain the same for the longer term. Like most people, to buy an asset you will need a long-term bank loan, which you could easily skive off if you would opt to rent.
Many would argue that although rent may bring about less financial pressure, it will not lead to any ownership and may be interpreted as money down the drain. What is your preference? Would you prefer to buy or rent? Let us know your views in the comments section below.