What is better: renting an apartment or buying with a mortgage?

November 4, 2024 Pruthwiraj

There are many offers for renting and lending housing, as well as arguments in favor of each of the parties. But you can only choose a profitable and affordable option individually. Let’s take a detailed look at the pros and cons of buying and renting.

Renting a home and its features

According to experts, renting real estate is a more financially advantageous deal than buying an apartment on credit. If you do not have enough savings for the down payment, then it is better not to consider a mortgage. The cost of rent is often lower than the monthly loan payment, the saved money can be put aside for the future.

Much depends on the goals and capabilities of a particular person. Uncertainty about the future, a series of unpleasant events on the world stage, an economic crisis – all this makes people postpone long-term mortgages “for later”. Most often, apartments are rented by young people or families aged 18 to 25. Independent life has already begun, but there are no savings for their own home yet. After 25, they often think about renting or buying an apartment.

When renting a home, it is better to enter into a written agreement with the owner. Many are satisfied with an oral agreement, but this carries the risk of losing the money paid as an advance payment. It will be difficult to prove this fact without written confirmation.

Obvious advantages of renting an apartment

freedom of movement. The main advantage of temporary housing is that you can quit your job at any time, move to another part of the city, or find a more affordable option. You are not tied to a long-term commitment to an apartment or a landlord;
separate housing without savings. Even if there is no reliable capital for investment in real estate, you can still rent separate housing. Part of the budget will cover the cost of renting an apartment without much damage to the family. At the same time, you will not share living space with someone else;
control over rental expenses. If you see that you cannot cope with the current cost of housing, you can always find a cheaper option. This will reduce the burden on the family budget while the financial balance is being restored. This trick will not work with a mortgage, you need to look for other options;
there are no current expenses for apartment maintenance. The tenant does not spend money on the maintenance of rented premises. For example, if a pipe gets clogged, a washing machine or other household appliances in the apartment breaks down, the repairs will fall on the shoulders of the owner. The same applies to contributions for major repairs, and property taxes, and other mandatory payments.

The main disadvantages of renting

unplanned change in cost. Due to rising inflation, changes in exchange rates and other market situations, rental costs often increase;
possible additional expenses. It is not easy to find decent housing without the help of a realtor. You can even run into scammers who re-rent already rented housing and then disappear with the deposit. The commission to the intermediary is sometimes proportionate to the cost of a month’s rent. In addition, tenants charge for one or several months in advance. So you still need to have some money in your arsenal;
the owner puts forward conditions. Many landlords do not want to rent apartments to families with children or pets, and also avoid “single people”. The range of available real estate in such cases is significantly narrowed;
the impossibility of making changes without the owner’s consent. It is impossible to make repairs, install your own furniture and appliances, or organize a rearrangement without the landlord’s approval. In general, financial investments in someone else’s apartment are pointless, since there is always a chance that you will be asked to vacate the premises;
difficulty in planning for the future. If a lease agreement is concluded, then you cannot be evicted for the agreed period. However, the family cannot know for sure whether the agreement will be extended, whether the price of the issue and the owner’s plans will change;
difficulty in saving. Most often, renters cannot put aside large sums for their own housing. The cost of rent takes up a significant part of the budget, no matter how you look at it.

When is a long-term mortgage beneficial?

If you take out a loan to buy real estate, you will become the owner only after you have paid off the entire loan amount. But you can live in the apartment, make repairs, rent it out – dispose of it completely at your own discretion. It is advantageous to take out a mortgage if you have at least small savings for the down payment. Under various preferential programs, the interest rate on the loan can be very loyal, and overpayments, accordingly, small.

Arguments in favor of buying an apartment

housing in ownership. The main advantage of buying an apartment on credit is that every month you pay the amount towards your own housing, and not into someone else’s hands, as is the case with rent. At the same time, payments can be comparable in price if you take out a mortgage with state support and all possible benefits;
quick purchase. You can buy an apartment on credit even if you do not have sufficient savings. Immediately after the transaction is completed, you have an apartment. Thanks to inflation, payments will become more and more profitable over the years. While savings may lose their value;
real estate is an investment. The cost of housing is growing from year to year. If necessary, you can resell an apartment for much more than it was originally purchased for;
permanent registration. In the purchased apartment, you can register and use the services of a clinic, enroll children in school or kindergarten;
concern for the future. The older people get, the less comfortable they feel in rented apartments; they want to have their own corner. When they retire, it will be difficult to afford the cost of temporary housing or monthly mortgage payments.

Traditionally, the following disadvantages of a mortgage are highlighted:

down payment. The first payment usually ranges from 15 to 30 percent of the property value. The amount is not the smallest. It can be saved up, taken out a consumer loan or paid with maternity capital. There are also loans without a down payment, partnership programs from developers, etc.;
interest rate. There is an overpayment on the loan in any case. Choose a mortgage with a favorable interest rate, use your benefits and government support;
transactions with the bank’s consent. Since the property is owned by the bank, it can only be sold or rented with its approval. The same applies to donations, divisions, exchanges, and even redevelopment;
additional expenses. Payment for a realtor, bank commission, appraiser services and other expenses will amount to a decent amount. It is also necessary to take out an insurance policy for the property;
tied to an apartment. If you want to move to another area or city, it won’t be as easy as with rented housing. The mortgage will remain yours until it is fully paid off;
financial discipline. A loan payment is a monthly payment that cannot be ignored. Otherwise, a late payment penalty will be added to it. If there are problems and you understand that you will not be able to cope with the mortgage, you can ask the bank for a credit holiday. For a certain period, you will be allowed not to pay the bill.

Buy or rent an apartment: which is more profitable?

Depending on your age, family and financial situation, you can understand which option is closer to you. If you often move for work, do not want to tie yourself down to long-term obligations, then you can settle for renting. If in the near future you want to start a family and children, can cope with the financial burden, then buying real estate justifies itself more than renting. The main thing is to correctly assess your goals and capabilities.

Where to start renovating an apartment?

It is worth starting the renovation with a plan that takes into account material costs and the sequence of stages. This saves the budget, as multiple alterations are excluded, as well as delays in deadlines. A well-thought-out renovation is completed on time.

How to start apartment renovation correctly

Determine the scope of work. Cosmetic repairs are aimed at updating the interior. Major repairs involve replacing communications, electrical wiring, and floors.

Calculate your budget. You shouldn’t run out of money halfway through. Estimate how much you are willing to invest in the renovation. Sometimes the financial budget doesn’t accommodate all the wishes of the apartment owners. You will have to save on some materials and services.

Which part of the apartment should I start renovating?

Kitchen and bathroom

“Dirty” and complex areas require special attention due to the presence of communications, plumbing and electrical equipment. Kitchen and bathroom renovation is associated with dust, noise and dismantling of old coatings. It is better to complete it first, so as not to pollute the already renovated rooms later.

Corridor

Materials and tools are constantly carried through the passageway. Refresh the corridor after “dirty” areas. You will avoid repeated contamination and damage to the finish.

Living rooms

The bedroom and living room are being renovated at the final stage. In the living rooms, the walls are painted, the floor is laid, and the ceilings are updated.

Sequence affects efficiency. Moving from “difficult” areas to “clean” ones eliminates rework.

How to choose an interior design

Evaluate the apartment. Study the layout. Consider the size, amount of natural light, and architectural features.
Interior. Choose the style that best suits your preferences and lifestyle.
Color palette. Choose primary and accent colors that harmonize with each other and create the desired mood.
Sources of information: Browse magazines, blogs and social networks for ideas and inspiration. Adapt solutions to your needs and tastes.
Pro tip: If the space requires a professional approach, then contact a professional interior designer.

Where to start renovating an apartment step by step

The time frame depends on the scale of the renovation and the condition of the apartment. The general order of work remains approximately the same.

How to find contractors and craftsmen

If you don’t have time, skills or the scale of work is large, then contact contractors. Qualified craftsmen have experience and construction tools. Professionals will save you from purchasing materials, organizing tasks and solving unexpected problems. The comfort in your home for many years depends on the quality of the work performed.

Tips for finding and selecting specialists

Ask friends, relatives and colleagues. Personal recommendations are the most valuable.
Study reviews on the Internet. Aggregator sites, forums and social networks provide information about contractors.
Request examples of completed work. Evaluate the quality and qualifications of the craftsmen from the point of view of the project.
Meet with potential contractors in person. Pay attention to listening skills.
Discuss terms, cost, payment procedure and guarantees. A written contract will protect your interests in case of misunderstandings.
Get quotes from several contractors. Compare prices, terms and conditions of work. Extremely low cost is not an indicator of quality.
Make sure contractors are prepared to provide information in a timely manner. A good handyman keeps the client informed.

How to purchase materials for repairs

Smart purchasing eliminates unnecessary costs, shortages or excesses of materials. Make a detailed list.

Rough: cement, plaster, drywall, screed.
Finishing: paint, wallpaper, tiles, laminate, parquet.
Consumables: adhesives, sealants, primer, putty.
Tools and equipment: spatulas, rollers, brushes, ladders, power tools.

Selection of suppliers and stores

Online or offline stores. Local construction stores provide the opportunity to view materials in person. The Internet offers better prices and home delivery.
Compare prices and conditions. Consider promotions or discounts. Free shipping saves a lot of money.
Reputation and reviews. Online reviews will warn you of quality or delivery issues.
Buy finishing materials in bulk. Tiles, paint or wallpaper sometimes vary in shade between batches.

What is special about dismantling works?

The beginning of the renovation in the apartment begins with dismantling – this is the first stage of active renovation. The space is updated and turns into a clean slate. Surfaces are cleared of old wallpaper, paint, tiles, parquet and other finishing.

It is prohibited to dump garbage in the apartment or in the entrance. Prompt removal of construction waste frees up space for further work.

What is included in the final finishing?

Painting walls or wallpapering.
Laying tiles.
Flooring.
Installation of interior doors.
Installation of skirting boards and trims.

The installation of built-in furniture and the arrangement of cabinet furniture complete the transformation of the apartment.

Checklist for checking repair work in an apartment

Start your repair inspection with a visual inspection. Visible defects on walls, ceilings and floors are unacceptable. Construction waste and dust must be removed.

Walls and ceilings

The walls and ceilings are level: use a level.
The putty surfaces are smooth, without bumps or dents.
The color of the walls and ceilings is uniform throughout the entire area.

Floors

The floor is perfectly horizontal: use a level to check.
Floor covering (laminate, parquet, tiles) without cracks and gaps.
The floor does not creak when walking.
The skirting boards fit tightly.

Doors and windows

Doors and windows without distortions and creaks.
The handles, locks and hinges work properly.
The rubber seals on the glass units are not damaged.

Electricity

The sockets and switches are securely fastened and work.
The sockets are installed in the right places.
The lamps are installed without any distortions and work properly.

Plumbing

The water from the taps flows with pressure, without leaks.
The faucets, drains and other plumbing fixtures are in good working order.
The plumbing connections are secure and do not leak.

Ventilation and heating

The radiators heat up evenly, without cold zones.
The air ducts are clean and have no obstructions to air circulation.
The hoods in the kitchen and bathroom are not clogged.

Furniture assembly quality

The cabinet doors operate smoothly.
The furniture is stable and securely fastened.
The structures are installed and comply with the design.

A repair inspection checklist is a reliable tool for quality control. Careful adherence to each point will help identify shortcomings. Do not rush to accept the work. Take the time to thoroughly check, so as not to fix hidden problems later.

LVD Development

Renovating an apartment is a responsible process. But even professionals will not help if the residential complex is poorly built. When choosing an apartment in a new building, pay attention to the reputation developer, quality of materials used and compliance with building codes. Choose quality housing so that your renovation becomes a long-term investment, and not a constant source of headaches.

LVD Development is your reliable partner in the real estate sector. We create modern and functional spaces. We offer apartments in high-quality residential complexes. LVD Development helps you make the right choice.