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  • Category: Miscellaneous

    Which is better option, living in rented house or own house?

    We all have a house to live in and it either falls into the category of a rented house or own house. It is a matter of discussion that whether to live in a rented house or own a house. People who argue that living in own house requires initial investment to buy a house and it heavily cost you in terms of EMI if you take the loan. If you buy the house in cash, it creates a void in your bank balance. Chances are that you will not get the return on your money invested in buying a home. So, people argue that one must live in a rented home. It will not increase the finance load on you. But my argument is that a rented home does not give you living freedom. You must obey the laws set by the homeowner. You will avoid investing in furniture or in other ways that make the home looks better. So, what are your views regarding the topic? Do you prefer to live in a rented home or live in your own house?

    This is my first entry (27th December) for the ongoing forum contest
  • #748507
    In this regard different people have different choices. Some prefer to have their own houses while some feel that rented houses are also a good idea to save one's capital in hand for expenditures.
    If we look at this from a long time perspective then it is better to have own house for living. The reason is very simple that the total amount which a person will be paying as rent along with its interest would eventually become equal to the capital required for owning a house. We do not feel the payments paid every month but on accumulated basis this money out go is very huge.
    Further the cost of house in most of the cases increases much more than the capital saved.
    So, the message is very clear that one should go early for possessing a house.

    Knowledge is power.

  • #748511
    That all depends on the conditions of the individual. If we live in a rented house we have to pay rent to the owner. As long as the owner allows you to stay you stay and you have to vacate if the owner wants it back. You have to live very carefully in the house so that there will not be any issues with the owner. You may not have freedom.

    If you purchase a house by taking a loan from a bank, you can pay EMI and you can think that you are paying rent to the bank. Once the EMIs are over, the house is yours. Another point is that you will have freedom and you can make the house as you want. EMI amount may be more than the rent which will be dependent on the amount and the duration.

    Instead of keeping money in the bank if you invest the same in a house the value of the house will increase and the returns will be more than the returns you are getting on FDs. The amount we are paying as EMI will be exempted from your income and you will save some tax also. So I always advise people to go for own house.

    always confident

  • #748524
    I agree with the point that one should have own house because a house will eventually give you a return on investment while a rented house does not. One also has to follow all the rules and regulations of the house owner. After 11 months, if agreeable, the tenant has to renew the rent agreement and be ready for increment in the rent. If you are living in a rented home and changing the home/society every few years, you will lose your neighbors and have to lose your friend circle. This will not be the case when you own a house. You will always have your neighbors with you in all phases of your life.
    Dr. Paresh B. Gujarati.
    Mechanical Engineer.
    'I'mprovement always begins with 'I'.

  • #748527
    Both rented house and own house have equal good and bad points. It is according to the living person. The major advantage of rented house is we can change if we got transferred in service or if we do not want the set up of construction, if we face water problem - water not coming in taps or water coming inside the house when flood comes etc., If it is our own house, we have to adjust or compromise for everything as we cannot sell the house as we please or buy another house when we face problem. It is not easy to say there is no rent for own house but the other expenses like property, water taxes, maintenance charges, repairing charges etc. borne by the owner, but is free for rented person as they are met by the owner.
    If the owner becomes very understanding, a tenant can live with peace for many years. During 2000-2010 we lived in a house where the house owner was very accommodative, I did small repairs, white washing the house during my brother's marriage etc., by my own self and they permitted.

  • #748529
    After reading this post my thoughts went to my one of the Marwadi friend who always life in the rented house though he can buy the luxury house and live. What the reason he gave was interesting and baffling. That in modern days owning a independent house in metro cities are not less than 1.5 to 2 crore and the interest at the rate of two percent works out to 4 lakhs month. In that four lakhs he can very well stay in a furnished house by paying 30,000 per month which costs very less. He keep moving to other places of furnished house and pay rent but never owned a house. Probably he has the meaning as we spend on owning the house and the return we feel is very less as explained above. Only thing is that we get appreciation of land when it was sold, but independent houses are never sold in future for sure.
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #748575
    I had lived in Mumbai for more than three decades. There I had met many people, especially businesspersons, who were happily residing in rented houses. Instead of investing their money in houses, they had invested in running businesses. That was really practical as they could earn income more than the amount of rent spent and more than the amount of rent saved.

    If one can avoid the hassles of moving frequently and changing houses, and forget about the sentiments of owning a house, then residing in rented houses is most prudent and practical.

    Many salaried people considered owning a house by borrowing(Housing Loan) as they could avail tax concessions and EMI was an easy way of owning an asset.

    But owning a house and renting it out for rent amount more than the EMI is a good option many have opted.

  • #748596
    My contention was ably supported by Venkiteswaran sir through his response, as wise people who are money minded would not spend on own houses which is very costly in Metro cities, instead opt for the rented house which is available even near the place of work as both saving on rent, and saving on transport is made profit.
    K Mohan
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #748617
    I think people have their own mindset in this matter. Currently many people have enough money to buy home but they prefer to live in rented home because of frequent transfer in jobs, may be they want to get good returns from the money they have now instead of buying house, they do not want to be settled in a given city permanently. But there are people who keep buying and selling homes for investment purpose.
    Dr. Paresh B. Gujarati.
    Mechanical Engineer.
    'I'mprovement always begins with 'I'.

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