Renting vs Owning A House: Which Is Better? - Ajmera Group

Renting vs Owning A House: Which Is Better?

Stepping into a house you can call home is definitely a divine feeling. A feeling that most people crave in their life. However, when it comes to getting a house, you have two options, renting a place or purchasing a home.

If the thought of what’s the better option between both has crossed your mind, then this blog is perfect for you!

Below, we will define the parameters of both options, including the advantages and disadvantages, guiding you in making the right decision.

A] Renting a House:

Renting is a convenient way to live. You basically pay the landlord a certain predetermined amount every month for living in their house. This monthly payment only includes the cost of living in the house and doesn’t include other bills like electricity payments.

You get to choose the accommodation as per your choice and preference depending on the space you need, the locality, and other parameters. Now let’s analyze the pros and cons of renting a house.

Advantages Of Renting A House

Advantages of renting a house:

1. Lesser monthly investment

The rents that you pay for living in a house are typically lesser in comparison to an EMI payment you would have to make.

2. No home loans

Unlike the situation when you are buying a house, you need not take a home loan to pay for house rent.

3. No legal issues

House taxes and other legal issues can be avoided if you opt for a renting option; this is because you do not get the ownership of the house, and hence you aren’t responsible for this.

4. Benefits of location

If you are moving to a new city for work, with the renting option, you can choose a house that is nearer to your office.

Disadvantages of renting a house

1. Constant increase in rent amount

In most cases, while renting a house, you will make a deal with your landlord for a certain payment amount that you will pay on a monthly basis. However, this same monthly amount will have a minimum of 10% increase every year if not more.

2. No ownership

No amount of money that you pay on a monthly basis will ever let you have ownership of the house. You will basically be paying the rent for as long as you live in that house with zero sense of ownership.

3. Huge security deposit

Besides the monthly rent, you pay to your landlord, an additional hefty amount of security deposit needs to be paid to the landlord as well. This is typically paid in a similar way as that of a down payment.

Disadvantages Of Renting A House Small Size
4. No tax benefits

Even though a home loan may not be something to look forward to, it does give you tax benefits. However, since the renting option does not require a loan, you get no tax benefits

B] Owning a House:

This is the option where you buy a house outright by paying the down payment and then either paying the balance amount through a home loan or through your savings. Unlike the renting option, a house-buying option is preferred by most because it guarantees you ownership at the end of your EMI tenure.
Let’s analyze this option with its advantages and disadvantages.

Advantages of buying a house

1. It’s a great investment option

Real Estate investment has become one of the great investment options because of the kind of returns it gives. If you invested in an up and growing area, you are bound to get great returns on the money spent in buying the house.

2. 100% ownership

You may end up paying a hefty amount through EMIs, but eventually, that’s still your home. You have 100% ownership of the house.

Advantages Of House Buying Small Size
3. It’s long term

When you buy a house in the city, or any other area it is a long-term investment in your living expenses. You will not have to switch houses because of the increase in rent or any other factors. This is a great advantage.

4. It provides you with financial stability

The financial authorities will consider your house purchase as an asset and can help you with top-up loans on your home loan if need be. This can act as a great advantage, especially if you are looking to invest in other areas as well.

Disadvantages of buying a house

1. It may prove costly

Unless you think about it from a long-term perspective, buying a house is going to seem costly. Even with a home loan coming into the picture this is still a lot of investment.

2. You may be stuck with a house you don’t like anymore

This may be a rare occurrence, but when you are renting a house, you have more flexibility to change houses or locations. When you buy a house, this flexibility is missing.

Which one should I choose?

Between renting a house and owning a house you should ideally choose owning a house. This is solely because even after the investment, you have 100% ownership of the house.
Your financial assets grow when you own a house, whereas in renting you are only giving away money on a monthly basis.


Getting a house is a big decision and one that requires careful thinking and analysis. It is important to look at various factors before making up your mind. You are not just looking at the house; you must look at the realtors’ background, the locality, and various other amenities that the housing complex may offer.

Getting a house is a once a lifetime opportunity for most; hence it is important to make sure it’s done correctly.