Apartment or Condo? What Young Professionals Should Consider
Owning a four-bedroom home with a white picket fence might not be on your radar, at least not for some time. You’re a young, single professional, so you don’t need a backyard to build a treehouse (though that could be fun). All you need is a nice apartment, but the question becomes whether you should rent it or own it. When you rent it, it’s called an apartment, and when you own it, it’s called a condo. So…
To buy or not to buy? That is the question.
The answer, of course, is not entirely clear-cut. Whether you should rent an apartment or own a condo depends on your circumstances. Let’s discuss the pros and cons.
By using our Rent vs Own calculator, you can better determine if it’s worth it to buy a property instead of renting it. When you buy a property, there are going to be more upfront costs, including the down payment. While there are plenty of available down payment assistance programs, chances are you’re going to have to pony up more cash at the front end between closing costs, the down payment, and other fees. Plus, once you’ve moved in, you’ll have to cover maintenance fees that your landlord is usually responsible for.
However, over time you’re likely to save money with home ownership. One of the best parts of home ownership is that you can build equity. If your property increases in value over the years—which it most likely will—your equity will increase, and you’ll have the opportunity to make money if you sell your condo. Every monthly payment you make will go towards paying off your mortgage instead of your landlord’s bills. Furthermore, your mortgage payment is likely to be much more predictable than your rent. If your landlord wants to jack up the rent price at the end of your lease, you’ll either have to comply or move.
While financially there are pros and cons to renting vs buying, when it comes to mobility, renting clearly has the advantage. If you’re someone who can’t stay in one place for too long, buying might not be the best choice for you. There’s a lot more hassle involved in buying and selling a home than renting a place for a year and leaving when your lease is up. Between closing costs and buyer negotiations, it’s better to rent if you are always on the move.
Conversely, if you are someone who likes to stay in one place for a long time, buying is going to have an advantage. As aforementioned, your landlord has the right to increase your rent or make you leave once your lease is up. Whether you’re renting or buying, moving is moving—and it’s a hassle. You may not want to haul your stuff from apartment to apartment every few years if you’re looking to stay in the same town.
There is a lot of joy and pride that comes with owning your own place, but it must be noted that “with great [ownership] comes great responsibility”. When you own your condo, you’re on the hook for everything. Unplanned repair costs and general upkeep are now your responsibility, and as obnoxious as a flooding bathroom might be, it’s worse when you have to pay for it.
However, as far as ownership goes, owning your own home has to take the cake. You don’t have any landlords…well, lording over you. You can decide how many holes you want to make, what paint you’d like on your walls, and how many dogs you want running around (within HOA parameters). The condo is yours, and any money you put in towards home improvement is for you—not a landlord who can kick you out at the end of your lease. It feels good knowing that you own the place and that you can do what you’d like with it.
Especially when it comes to apartments/condos, it can be difficult to decide whether to rent or buy. If you’re always switching cities and looking for the next job, then renting might be the better choice for you. However, if you’re hoping to stay in your city for a while and make an apartment a home, buying a condo could be the right move.
For more articles on renting vs buying, check out this article.
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