Someone sent me an infographic the other day about the pros and cons of renting versus buying a home. It looked interesting but when I asked, I got to know that it was done internally based on some research by asking Gen-Yers. Nothing wrong but perhaps let me write some comments based on my personal interactions with Gen-Yers, both those who love property as an investment or those who prefer to enjoy renting instead. One day, in the future, the house prices would be extremely high. So high that everyone would have no choice but to rent….. a space in a room instead. Until that day comes, it’s still best to buy.
In the infographics, the advice given was that if we do not yet have enough downpayment for the property that we want, we should rent first. Actually renting is a pretty dangerous game to play. The reason is because even when we rent, we want to rent at places where we like. Perhaps it’s the area that we may potentially buy in the future. That’s why rental in many of these ‘hotter’ spots are also higher too. Do we know WHO GAINS the most from our rental? Yes, the owner of that place we are currently renting.
Coming back to renting instead of buying. Would we try to rent as LOW as possible so that we can save as MUCH as possible? Are we sure that we would rather rent an old place so that we can save RM400 per month or more? Honestly, not many are willing to stay in flats while saving tobuy a condo. They are more likely to rent a condo instead and then found out that their savings per month is too slow compared to the potential price increase for condos in hotspots. Assuming that the rental difference between a flat and a condo is just RM400 per month. That’s RM4,800 per year and within 5 years, we would have accumulated close to RM30,000 from rental SAVINGS alone.
Hopefully, we are now jolted awake. That’s why if we could not yet afford the place we love, buy somewhere we could afford first. Oh yeah, the rental that we paid is considered a ‘loss,’ while the mortgage payments that we struggle to pay every month? That’s called, ‘owning our own home’ in the future. Slowly but surely. Do note that there’s really no such as thing as right or wrong. Some may just prefer to rent their whole lives and still be extremely happy. Some may suffer after buying their first property with never ending issues with the property. Just do what we believe is the best for us and love it. Happy thinking and deciding.
written on 10 May 2016
next suggested article: You may not get good tenants all the time, but still proceed