Author

Douglas

Browsing

Renting versus buying a home is a common question asked by many. There are no right or wrong questions to ask. The most important factor to consider is one’s situation. Each person has their own pros and cons as there are several factors that can influence the final decision. Let’s take a look at 6 considerations when choosing to rent or buy a home:

Consideration 1: Situation

How long a person plans on living in one place will influence their choice of renting or buying. Renting may be more beneficial for a student that wants to be in closer proximity to the school. However, for a couple or individual that has the intent of raising a family or staying in the same home long term, buying is the better choice.

Consideration 2: Time frame

Generally speaking, if the case is living at a home short term renting is more practical. On the other hand, staying at a home long term, buying would be more favorable.

Consideration 3: Income

Income determines how much mortgage or rent a person can afford. The rule of thumb for how much mortgage an individual can afford is 3 (in some cases up to 5) times their annual gross income.

Consideration 4: Stability

Having a stable full-time job for at least 1 to 2 years will show lenders (the bank) that the buyer possesses stability. As a result, there is a better chance of being approved when applying for a mortgage. There is the added benefit of having peace of mind from knowing a steady income will allow mortgage or rent payments to be made.

Consideration 5: Renting

When the funds that are being brought in are not sufficient, renting may be the smarter choice since it’s cheaper. There are fewer responsibilities in terms of maintenance. If there’s a problem with the electricity or plumbing, the responsibility falls on someone else and forking up extra cash is not necessary. Additionally, one can move from one home to another when the lease is up or stay there as long as needed. On the other hand, when renting a home, all of the money that’s going into rent payments is basically gone. That money will never be seen again as it is now in the landlords pocket.

Consideration 6: Buying

Buying a home is probably the biggest investment that someone will ever make. People rarely pay for a home in full, so people take a mortgage from the bank. Even though this means paying a lot of money towards interest to the bank, the value of the home will most likely increase in value. It will increase enough that it would compensate for the interest paid or perhaps, even more, depending on the market. There’s no better feeling than to have a place to call home. On the other hand, damages or repairs to a home will be costly. Maintaining a home such as cutting the grass, hiring a snow removal service, and condo fees (if applicable) will also be expensive. There is also the added expense of paying a one-time welcome tax fee, annual taxes, and home insurance.

So the question, “is it better to rent or buy a home?” really depends on the individual’s situation, time frame, income, and stability. The choice of buying and investing money into a home or opting for the more convenient choice is up to each person.

Whether you’re planning on leaving the comfort of your parent’s nest or currently renting,“Should I rent or buy a home?” may be on your mind. Don’t worry you’re not alone, it’s a common question asked by many people who aren’t sure whether or not they should be homeowners. The answer isn’t a simple one because each person has their own pros and cons. There are a number factors that can influence their final decision, let’s take a look at 6 considerations when choosing to rent or buy a home:

Situation

How long a person plans on living in one place will influence their choice on renting or buying. Renting may be more beneficial for a student that wants to be in closer proximity to school. However, for couple or individual that has the intent of raising a family or staying in the same home long term, buying is the better choice.

Time frame

Generally speaking, if the case is living at a home short term renting is more practical. On the other hand, staying at a home long term, buying would be more favorable.

Household Income

Income determines how much mortgage or rent a person can afford. The rule of thumb for how much mortgage an individual can afford is 3 (in some cases up to 5) times their annual gross income.

Stability

Having a stable full time job for at least 1 to 2 years will show lenders (the bank) that the buyer possesses stability. As a result, there is a better chance of being approved when applying for a mortgage. There is the added benefit of having peace of mind from knowing a steady income will allow mortgage or rent payments to be made.

Renting Point Of View

When the funds that are being brought in are not sufficient, renting may be the smarter choice since it’s cheaper. There’s less responsibilities in terms of maintenance. If there’s a problem with the electricity or plumbing, the responsibility falls on someone else and forking up extra cash is not necessary. Additionally, one can move from one home to another when the lease is up or stay there as long as needed. On the other hand, when renting a home, all of the money that’s going into rent payments is basically gone. That money will never be seen again as it is now in the landlords pocket.

Buying Point Of View

Buying a home is probably the biggest investment that someone will ever make. People rarely pay for a home in full, so people take a mortgage from the bank. Even though this means paying a lot of money towards interest to the bank, the value of the home will most likely increase in value. It will increase enough that it would compensate for the interest paid or perhaps even more depending on the market. There’s no better feeling than to have a place to call home. On the other hand, damages or repairs to a home will be costly. Maintaining a home such as cutting the grass, hiring a snow removal service, and condo fees (if applicable) will also be expensive. There is also the added expense of paying a one time welcome tax fee, annual taxes, and home insurance.

So the question, “is it better to rent or buy a home?” really depends on the individual’s situation, time frame, income, and stability. The choice of buying and investing money into a home or opting for the more convenient choice is up to each person.

If you can’t afford a gym membership, it shouldn’t stop you from exercising. People need regular exercise throughout the week in order to stay healthy. There are so many things you can get into shape without having to spend a penny. Here are 20 free frugal exercise tips that almost anyone can do:

Tip 1: Ride your bike
Take a nice bike ride around the block or anywhere you wish. Invite a friend to go biking with you too. You’ll enjoy the outdoors while exercising at the same time.

Tip 2: Tone your body
Tone your body by doing exercises such as pushups and situps at home. You’re not losing out on anything, you’ll look and feel a lot better.

Tip 3: Walk or jog with your dog
This is beneficial for you and your dog. They also need regular exercise just like people to keep fit and stay healthy.

Tip 4: Take the stairs
Walk up the stairs instead of taking the elevator to work, home, or at the mall. It’s a quick and easy way to burn extra calories during the day.

Tip 5: Dance
Turn on the radio and dance! It’s a fun way to shed off extra pounds.

Tip 6: Mow the grass
Don’t let the grass grow too long, mow the lawn once a week. The more often you cut the grass, the shorter it’ll be, and easier to mow the next time you do it.

Tip 7: Go swimming
Go to a friends house or a public pool and swim. It’s a nice way to cool off and relax on a hot summer’s day.

Tip 8: Shovel the snow
Instead of paying for a snow removal service, do it yourself! You’ll burn a lot of calories and save hundreds of dollars doing it.

Tip 9: Sign up for free gym membership trials
Most gyms offer a one week free trial, take advantage of these promotions. When your promotion is done, move on to the next available gym.

Tip 10: Use objects
Lift, pull, and push things around the house. You’d be surprised on the things you could use instead of hand weights.

Tip 11: Play outdoor sports
Shoot some hoops by yourself or throw around a baseball with a friend. Organize a game of basketball, football, or anything with a bunch of buddies outdoors.

Tip 12: Go hiking
Find a local park and go hiking. Explore new places by yourself or with a friend.

Tip 13: Garden
Water your plants and take out those weeds. Do some landscaping around your house, it’ll burn you calories and increase the value of your home.

Tip 14: Make love
Studies have shown, love making on a regular basis is overall great for your health. It promotes bonding between partners and generally makes you feel better.

Tip 15: Clean your home
From vacuuming to cleaning out your garage, cleaning your home is a great way to burn calories. You’ll also make your home cleaner and more presentable.

Tip 16: Rent exercise videos from the library
Rent free exercise videos from your local library on anything of interest to you. This way you get to choose what you want to exercise to.

Tip 17: Watch free exercise videos on YouTube
Choose and search thousands of exercise videos on YouTube. There are so many free how to’s and tutorials on pretty much anything you want to learn.

Tip 18: Borrow equipment
Go bug your friends and family to borrow their exercise equipment. Just make sure you give it back.

Tip 19: Exercise on TV
There are many TV shows on air that show workouts. Check out when these shows are airing, record them if you can’t watch them at the time.

Tip 20: Jump rope or jumping jacks
Dust off that jump rope or if you don’t have one, do jumping jacks. Watch TV or listen to music while doing this and you’ll find the time go by faster.

Moving out on your own is fun and exciting. You get to go out and come home whenever you want, eat and drink whatever you want. You have a place to call your own, your kingdom, and fortress. At the same time it can be very stressful. All of a sudden there’s a mortgage and… you guessed it, bills. After all, being a responsible adult is apart of growing up. Here are the first time home buyers expenses list we’ve came up with:

Mortgage

Your home will probably be the biggest investment of your life. Talk to your mortgage broker and financial planner to come up with a comfortable pre-approval amount when buying your home. You can choose between different interest rates such as fixed and variable, as well as your amortization period.

Condo fees (if your buying a condo)

These fees are what it costs to maintain the building, for example, mowing the grass, plowing the snow and vacuuming the hallway carpets. If you buy a house, you either have to do these things yourself, or hire someone else to do these things for you.

Notary fees

These are fees to process the legal documents needed when buying your home. Expect to pay anywhere from $1000-$2000 depending which notary firm you go to. Notaries can be quite expensive for some legal documents saying that you own a property, shop around for the cheapest rate.

Welcome tax

Some places require a welcome tax. Expect the welcome tax to give you a big welcome to your new home. You’ll get the welcome bill in the mail a few months after you move in. Cost depends on the purchase price of your home.

City and school taxes

These taxes really depend on which city you live in and the evaluation of your home. For an estimate, contact your city hall.

Mortgage insurance

The united states has private mortgage insurance (PMI), while canada has the canadian mortgage and housing corporation. Both types of mortgage insurance is mandatory if your downpayment is less than 20% of your home. Cost depends on the percentage down and the total price of your home. On top of mortgage insurance, you have to pay taxes on it as well.

Home insurance

Insuring your home in case of theft or property damage is mandatory. It’s also a good idea because you’re protect your home and most belongings.

Furnishing

Furnishing your house could be pricey if you’re buying everything new. You may need to furnish your new home with appliances, a home theater, bedroom sets, and couches. Cut costs by buying second hand from sites like craigslist and kijiji or hand-me downs from family and friends.

Parking

If you’ve just purchased a house parking will be free. Having moved into a condo means buying the space for parking and paying condo fees to maintain that parking space. If you didn’t purchase a space, you may be renting one.

Utilities: electricity and water

You may be more conscious of how much electricity and water you’re using now that you’re pay for it.

Utilities: cable, internet and phone

Cable television, internet, and telephones or cell phones aren’t mandatory but who doesn’t want to live without all three or four.

Groceries

If your on a tight budget, you’ll probably lose weight. Groceries are expensive so cut down on eating out by eating in and you’ll save a lot of money.

Optional: mortgage life insurance

This type of insurance is optional when you buy your home. It’s an insurance you pay incase you or your co-owner (spouse) pass away, your mortgage is paid off in full.

Optional: life insurance

This is optional as well. This type of insurance is more common than mortgage insurance. You can choose how much you want to be covered. Based on a lot of factors including medical history and lifestyle habits, your premium will be adjusted accordingly.

Optional: money borrowed from RRSP’s

If you’ve borrowed money from you’re Registered Retirement Savings Plan (RRSP)to help pay for your downpayment, you have 15 years to pay it back. The easiest way to do this is to divide the total amount you’ve borrowed by 15 years. Contribute this amount back to your RRSP’s every year and plug it in your taxes.