Now that it’s 2021, making a critical decision of whether buying a house or renting one will be most suitable for your needs. The 2020 global pandemic has left its mark on several industries with the real estate sector hitting the lowest mortgage rates in a few countries. On the other hand, several other countries are witnessing inflated home prices due to the problem of low inventory. While 2020 was filled with bidding wars and high prices, will 2021 be any different? With the investors coming back towards the end of 2020, let us look into details about how you should decide between buying and renting a house in 2021:
- Is the capital adequate?
The first factor which will help you reach your decision about renting or buying is the amount of capital you can bring forth to the table while buying a house. Of course, home loans are always the go-to option, but with 2020 experiencing the highest home loan applications, your credit history and score will play a vital role. While you certainly do not have to worry about paying the entire value of the house, the down payment amount cannot be ignored. And with the expectation that interest rates are going to be just as low in 2021, your installments will not create a headache.
- Your duration of stay
Undoubtedly, investing in real estate will always be a booming investment. However, 2021 is prepared to witness a continual growth in home prices worldwide. Thus, before grabbing the opportunity of investing, analyze how long you need that house for. Investing in an arena when the prices are already reaching a new high will not turn out to be significantly beneficial. Thus, in cases where you need the house for a short period, renting it out instead of buying it would be much more practical.
- Rising Prices
The housing prices are the most essential factor in deciding whether you wish to make a buying or renting decision. It is expected that 2021 will be a continuation of 2020 in the rising prices of houses. While the interest rates are expected to stay at a lower level, the final house prices will continue to rise. However, there will also be a greater variety of houses to choose from. As investors have started putting their leg in the market again, a rise in the variety of houses and their prices ought to be seen.
Real estate is a market that differs from street to street, but these factors remain the basis behind deciding between buying or renting. With 2020 ending at the peak levels of house sales, especially during the festive season, expectations for 2021 are set. However, if you have the adequate capital to make your initial down payment, grabbing the opportunity of such low-interest rates must not be missed.