Saturday, June 11, 2016

BUY OR RENT?

RENT VERSUS BUY?

The common view is that you are not moving forward financially unless you are buying your home. “You are making someone else’s payments,” they’ll chide. They almost shame you for renting.

Like most common beliefs, there is some truth to these sentiments. But, it is not necessarily true in all cases.

For instance, consider our brave service men and women that are transferred to this area to serve at the Naval Base. They are usually only here three or four years. Buying a home is a commitment they need not necessarily make. Further, they can receive orders to deploy on very little notice, should world affairs demand it. Our local military are probably smart to rent and to further have the expressly reserved ability to break the lease without notice in the event of orders to leave the area.

Another group that may wish to forgo buying and stay with renting is recent graduates. Getting a career established might result in following a job elsewhere, if only for a couple years. A home and mortgage ties you in one place. Until you know you are ready to put down roots, a rental is can be a more flexible option.

Finally, if the purchase of the house will be such a stretch, renting for a while longer might be a better option. Young couples who are both working can often qualify for much more home than the husband could pay for on his salary alone. If a purchase is made that requires 40% of all household income to buy, if she gets pregnant and is on bed rest, it may require 65% or more of his one income just to pay the note. Then, when the air conditioner has to be suddenly replaced, there is just no remaining margin to do so. Debt is run up further and foreclosure notices become common. The house has become not a blessing, but a burden.

Owning a home debt-free is still part of the American dream. I am reminded that debt, including mortgage debt, is never praised on recommended in the Bible. No one is saying it is sinful, but it is only given a negative treatment in Holy Scripture.

Do not let “keeping up with the Jones” cause you to make big mistakes. The late Dr. Adrian Rogers used to caution that, “We buy things we don’t need, with money we don’t have, to impress people we don’t like.”