The decision to buy or rent a house is one of the most important decisions an adult Ghanaian will make at some point in life. Should I buy or rent? This issue can be quite controversial because everyone has an individual opinion on the matter. Some feel renting a house isn’t logical, why rent a house when you can just buy? Others feel buying a house comes with many responsibilities and long-term commitments so they opt for renting.
If you are at loss on whether to buy or rent a house, this article will help you make a better decision in Ghana as you carefully weigh your options. Buying and renting a house has its pros and cons. To enable you to decide wisely, let’s look at them.
Merits of buying a house
Buying a house has its advantages. Let’s look at them:
Build home equity
Home equity refers to the value of your home that can be sold for money. It refers to how much you owe on your mortgage in comparison to how much your home is worth. As you pay your mortgage, you build equity for the house. You can decide to sell the house later and use the money for a down payment on your next house if you are thinking of buying a new house.
Customize to your taste
Provides a sense of stability
Varieties to choose from
Demerits of buying a house
Significant disadvantages of buying a house are:
Responsible for all costs of repairs
You are responsible for maintenance and repairs like roof repairs, plumbing, and other structural repairs that incur unexpected costs. This would have been a landlord’s duty if you were living on rent.
Long term commitment
Owning a house involves a long-term commitment. If you travel often, you might consider living on rent.
More expensive than renting
Buying a house is generally more expensive than renting in addition to extra costs that may arise in the future for maintenance and repairs.
A chance to earn or lose
The value of your home can decrease or increase, potentially affecting your finances. There is a feeling of uncertainty because you stand to make money if the home value appreciates and you also stand to lose a lot of money if the home value depreciates.
Pros of renting a house
Renting a house has its advantages. Some of them include:
Negotiable rent prices/ lower housing costs
While the cost of renting a house in Ghana varies with landlords, it is much lower than the cost of buying a house in Ghana. Some rent prices are negotiable and you may not be required to pay all your fees up-front. Some landlords may allow you to pay one to six months in advance.
Flexibility in duration
You can move whenever your lease ends. Renting a house saves you from the long-term commitment that comes with owning a house. If you are thinking of staying in a particular location for a short time, likely 6 months or less, you might consider renting a house.
Greater responsibility on the landlord
Generally, it is the responsibility of a landlord to handle repairs, cover expenses incurred, and arrange security. This is not the case with owning a house where the house owner takes care of all costs.
Flexibility of location
You can rent a house anywhere you desire depending on several factors; the proximity of the house to your workplace, school, hospital, etc. In the process, you reduce transport costs.
Cons of renting a house
Renting a house also has disadvantages such as:
Sudden move if the landlord decides to sell
The landlord might suddenly decide to sell the property and that would mean moving out of the house. The landlord could make it less dramatic for you both by increasing the rent leaving you with no option but to move out.
Bad landlord behavior
Some Ghanaian landlords do not carry out their responsibilities effectively. They argue with tenants who will pay the costs of house maintenance and repairs even when it is clear that it is their responsibility to do so except otherwise indicated.
Difficulty finding affordable/short-term houses
In Accra, it is not easy to find an affordable house for rent and can be especially difficult if you plan to stay for a short while. This is because Accra is the center of Ghana and is populated. There is always an increasing demand for houses which skyrockets the prices of existing ones.
Abiding by rules
There’s limited freedom to alter structures in the house to suit your lifestyle. You have to abide by the rules given by the landlord no matter how strict they are.
Factors to consider before renting or buying a house
Choosing to buy or rent is a decision that is solely yours to make. You need to weigh your options squarely before deciding on whether to buy or rent. There are several factors to consider that can help. Let’s look at them.
Long term plan
Having a clear plan in mind will help you make a good decision. Long-term decisions like building a family, investing in a venture, etc., and short-term decisions like traveling consistently can help you determine if you want to buy or rent.
Financial resources
Be realistic. Ask yourself questions like:
How much can I afford?
Will my present income be consistent?
Will the value of money appreciate or depreciate with time?
Does my current income afford me the luxury of buying or renting a house?
Asking yourself these questions will help you think critically and make a better decision.
Location of Property
The price of a house may vary depending on the location of the property. In Accra, houses located closer to the center of the city are higher in price than the houses located on the outskirts of the city. You can afford to buy a house far away from the center of the city but if you are seeking a closer alternative, renting will be a better option.
It is our goal that this article helps you make a better buying or rent. If you are now set to either buy or rent, contact ZeaHomes. Let’s get you the home of your dreams.
