Renting v. Owning: What Do I Need to Know?

We asked two local experts to weigh in on this great debate. They say there are pros and cons to both and offer tips to help you decide what’s right for you. Pedro Ramirez (left) is the mortgage development and originator at Centennial Bank, and Shamim Okolloh (right) is vice president and community outreach officer at Encore Bank

BENEFITS TO OWNING

“Homeownership is one of the best vehicles for building wealth, as homes are an asset that, over time, tend to increase in value, creating equity,” Shamim said.

“When you own your own home, you’re on your way to building equity and wealth the same way generations of people before us have,”
Pedro said.

“The difference is that paying for a home has the magic word we all love: equity,” Shamim said. “When you pay rent, you do not receive any proceeds when you move out. But if you own a home, pay the mortgage and decide to sell it in seven years, you are likely to make a profit.”

REASONS TO RENT

“When you rent, you are not responsible for lawn care, maintenance, repairs and acts of nature you just can’t control,” Pedro said. “When you buy a home, you need to know you are taking on all these responsibilities, and some hidden
ones too.”

“Benefits of renting include having time to build up your savings and work towards being lender-ready (increasing your credit score) and not being tied down to a geographic region,”
Shamim said.

“If you move around a lot or travel often — if you’re not going to be home regularly to enjoy your house and do the required maintenance — you may want to hold off until you have more time [to] dedicate to your home,” Pedro said.