When you rent a house it has some disadvantages that you must consider before making a decision to either rent or buy a house. Most of the disadvantages has to do with stability and freedom.
Disadvantages of Renting a House
- No equity – You cannot build equity because you are only renting the house. Rent money is always dead money. You pay for the landlord’s debt on the house, if he bought it on mortgage. . If you are renting, any improvement you make on the house increases the value of the landlord’s property. If there are new shops or school that opens near your rented house, the property value will increase. Your rental may also increase.
- No Stability – You are living in a rented house on a temporary status. Any violation of the contract of lease allows the landlord to evict you within a 30-day notice. If the landlord decides to sell the property he can advise you to vacate the house.
- No assurance of immediate action for repairs – Although the maintenance of the house is the responsibility of the landlord, most of them are not willing to do repairs or it takes a long time before the repairs are addressed by him. In the meantime you suffer the inconvenience.
- No security of tenure – When your contract of lease ends, you have no security that it will be renewed. If ever it will be renewed, the landlord will surely increase the rental. You have to transfer to another house that is within your budget.
- No freedom. Some landlords have restrictions about pets, number of children and so forth. They have regulations about renovations or decoration changes.
- No financial incentive – You cannot be refunded for any improvement you have made on the house. You cannot enjoy the tax incentives offered by the government or from companies if you install green appliances.
- Rentals of houses may cost as high as your loan payments if you were to buy a house.
Making a decision to rent a house, rent an apartment or buy a house is your personal decision. It all depends on your needs, how much you can afford and your lifestyle. Renting a house may have disadvantages but if you cannot afford to buy a house, then you have no other choice but to rent a house.