Steps you can take to save on housing:
- Do the math: decide on renting vs buying
- Renting? Rent affordably and consider roommates.
- Buying? Buy affordably and consider house hacking.
In More Details
Do the math: decide on renting vs buying — buying a home is not always better than renting. Renting is not throwing money away. You're getting a place to live in, zero worry about home repairs, and opportunity to move when your lease is up. While purchasing a home is often seen as investing in an asset, it comes with its own costs: maintenance, insurance, property taxes, transaction fees. Decide on if you should rent or buy by using an online calculator. Perhaps more importantly: take into consideration your own lifestyle.
Renting? Rent affordably and consider roommates. — while you can probably afford a luxury apartment, try to resist the urge and find something cheaper! One of the benefits of purchasing over renting is "forced savings", your monthly principal payment is forcing you to build equity. With renting, it's up to you to take your savings and invest it. A great way to reduce rent is by living with roommates! Often times, it's more affordable to pool together money and share resources.
Buying? Buy affordably and consider house hacking. — the home you live in should not be considered an asset. Your monthly payments is comprised of PITI or principal, interest, taxes, and insurance. Only the principal contribution is building up your net worth. By purchasing a more affordable home, you'll reduce the amount spent on interest/taxes/insurance. A great way to earn additional money on your home purchase is to house hack. House hacking just means being a landlord and living with roommates. Or it could mean purchasing a duplex and renting out the other unit.
Use these rent calculators:
For more information about house hacking:
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