Why You Should Rent vs Buy A Home In 2020

In this video, we go discuss why renting may be a better option than owning a home.

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Is renting instead of buying a home really a good idea?

By the end of this video, you’ll be able to determine whether buying or renting is the right choice for you.

Buying your first property seems to be a financial milestone for most young adults.

(0:56) THE CULTURE OF HOME OWNERSHIP

It’s almost ingrained into our cultures that purchasing your first piece of property is a sign that you’ve made it.

At social events, you often hear about the latest relative or friend who just bought their first property and are so proud of it.

You always hear the arguments about how renting a place out is a waste of money.

"What’s the point of paying RM1,500 a month on rent when you can pay slightly more as a mortgage and have something to own?"

That’s technically true, but people don’t consider the real costs of home ownership that a renter doesn’t experience.

When you buy a property, besides your mortgage, you would probably have to pay property taxes, renovation or repair cost, property insurance, etc.

Here are the 3 reasons why it’s better to rent than buy a home:

(2:03) 1. EXPERIENCE NEW & DIFFERENT PROPERTIES

In KL or in any big city, new apartments & houses are continuously being developed, with more and more being built every year.

With the readiness and expansion of public transport, staying in apartments that are connected to these stations are extremely convenient.

Renting allows me to stay in the newest apartments in town that are made more relevant due to the rise of new infrastructure.

At the fast pace of development we’re experiencing, more and more places will start opening their doors to new opportunities.

If the property I decided to rent ends up being rundown, or if maintenance of the building isn’t good? Or perhaps the sound of cars from a nearby highway keeps me up at night.

Just as easily as I got in, I could get out of the place and move on to the next.

The abundance of supply in residential properties means I wouldn’t be left hanging without a roof over my head!

Yes, the moving experience can be painful, but we don't own any furniture that would make moving difficult #minimalism.

(3:35) 2. LOCATION FREEDOM

As a young person, the opportunities out there are endless. Most of us are not at the point in our lives where we stay with the same company we’re working at for 30 years. This was much more common in our parents’ era.

In the age of digitization, cities not previously considered urban can quickly be the next hot location. This means that our options in deciding on a nice area for a home could be more plentiful in the future.

Renting gives us the flexibility to move to a new area if an opportunity arises, such as a job offer.

Sure, I could technically rent out the place if I decided to buy a house near my current workplace and want to make a change.
But that’s an additional step I have to take when considering offers. I’ll have to find a way to rent out the house I bought, preferably at a rate which doesn’t lose you money, and that takes a lot of mental and physical effort.

I can imagine getting a good job offer at a much better company, only to be held back by the fact that you need to relocate yet still have to pay a mortgage on the house you decided to buy.

All this hassle doesn’t seem worth it to me. I’d much rather have the option of being able to move out and not give two damns about needing to find a renter or paying mortgage.

Who knows, areas outside mainstream Selangor, Johor, or Penang could open its doors to large companies to set up shop and provide great career opportunities.

And who knows, maybe your career takes you overseas.

(5:05) 3. NOT ALWAYS THE BEST INVESTMENT

Houses are an investment and they always go up, right? Well, it depends.

A lot of people don’t take into account the opportunity cost of buying property.

The mortgage that you pay on a monthly basis could just as easily be put into another investment that would probably yield the same returns, or even better!

We regularly hear financial advice about how houses are assets and always go up in value.

That’s true, but you know what else tends to always go up in value? Stocks.

And we much prefer stocks to properties as an investment for a simple reason;

Stocks are WAY more liquid

It allows me to quickly sell off my investments if I feel that it’s going against me, or if I simply just need the cash.

(7:08) ALTERNATIVE TO PROPERTY INVESTING

(8:21) WHEN BUYING PROPERTIES CAN BE A BETTER CHOICE

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Видео Why You Should Rent vs Buy A Home In 2020 канала Emir | The Millennial Finance