Articles

Reasons Buying is Better Than Renting

by Diksha Sharma Blogger and writer

One of the major decisions of life is in deciding whether to rent or buy a property in India. Many dreams to own house whereas the others feel it is more economical and practical to rent a house. The difference between the two opinions is dependent on one’s vision for life and comfort.


Here’s a list of reasons why buying is better than renting:


Cheaper and Profitable in the long run:

The price of land or home is dependent on the location, in certain areas buying can be a more affordable option for renting. Owning a home may be expensive but comes with added benefits and advantages such as being eligible to tax deductions which can further help the homeowner reduce their tax bills.


The table below will help you understand and compare the difference between renting and buying and its impact in the long run with respect to costs.

Case 1 – Rental Home

Expenses

Calculation

Rent per month

20,000 INR

Rent appreciation PA

5%

Total Rent Amount paid after 20 years

80 Lacs

Asset Value after 20 years

0

Case 2 – Own Home

Expenses

Calculation

Loan amount

40 lakhs

Tenure of the loan

20 years

Interest rate

9%

EMI during the tenure

36000 INR

Total amount paid after 20 years

86 Lacs

Asset Value after 20 Years at 10% appreciation Per Annum

2.69 Crores


As per the above example, it can hence be seen that, when you take a house on rent, you end up paying almost the same cost as owning a house. However, when you buy a home, you are building an asset that increases your wealth.


Intangible Benefits:
Owning a home brings intangible benefits to the owner such as a sense of pride and ownership, a sense of stability and belongingness to a community not only for the owner but also for their children.


Investment:

Buying a home is a form of an investment as its value may appreciate over time, building the overall equity of the homeowner. Also, when buying a home, you buy freedom to do what you like with no obligations from the landlord. With an independent apartment, the owner can also generate additional income by renting out rooms, or floors or the entire house to others.


No more obligations:

Owning an independent home will free the individual from the hassles and restrictions of the landlord. A house owner does not have to worry anymore about paying for increased rents. Your home becomes your canvas to express yourself by painting the walls, hanging wall paintings and also adding new appliances and fixtures to your house as per your preference.


When deciding whether to buy or rent a home, keep in mind the above list and also the financial aspects and your dreams of living a particular lifestyle.



Sponsor Ads


About Diksha Sharma Advanced   Blogger and writer

48 connections, 0 recommendations, 161 honor points.
Joined APSense since, November 30th, 2018, From Gurgaon, India.

Created on Mar 26th 2019 06:52. Viewed 233 times.

Comments

No comment, be the first to comment.
Please sign in before you comment.