By Oliver Clarke

Real estate is an ever-shifting landscape between buyer’s markets, seller’s markets, rising and falling property values, and housing bubbles. If you’re looking for a new place, often you will encounter the question, is it better to rent, or to buy? Owning a home is a central part of the traditional American dream, but do the aspirations of 18th Century frontiersmen hold true for 21st century consumers? The answer is, it depends.

Common wisdom holds that a house is an investment. If you’re not paying rent, you can put that money into house renovations, and after some time, the value of the house will exceed its original price as well as the cost of renovations, at which point you can sell it for a profit. If rental prices are very high where you want to live compared to house prices, and you are planning on living there for more than 4 years, it may be in your favor to buy a house.

Most recent articles written on this question tend to fall towards renting, for a number of reasons. As any homeowner can tell you, a house costs more than the listing price—there’s also property taxes, utilities renters don’t usually have to pay, mortgage fees, and maintenance costs. If you used a real estate agent, they have to get paid as well. Across the country, house prices and mortgage fees have been rising faster than rental costs have, which generally make renting more affordable. If you work in a city, you can usually find rental properties inside the city, and affordable housing to purchase is outside the city, so transportation costs must factor in as well. Lastly, there’s the opportunity cost, which is really what cinches the deal for most of these articles. The question is, what do you do with your extra money, having saved by renting? If you take the opportunity to invest in the stock market, instead of sinking it into a mortgage, then the money will work for you.

Choosing to rent or buy is a personal choice, and it is dependent on location, level of savings, anticipated income, and how long you expect to live in the same location. Many factors and calculations go into it, however, there is a tool to make it easier. The New York Times has an online calculator to help you make this decision. Simply Google search “NY Times buy rent calculator” to find this handy tool, and begin making the right decision for your future.

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