Buying or renting a property?

The life goal of many people is to own a flat or house. Historical circumstances have already taught us that there are three ways to acquire a property: build it, buy it or rent it. Because the procedure follows a set sequence of steps, buying or renting should not cause difficulties. However, it is worth considering which of the last two options is more advantageous – renting or buying a property. The process of choosing a satisfactory option can be difficult and exhausting for you. Think about whether you would rather repay a mortgage on your own home in instalments, or pay rent every month to the landlord of a rented flat or house. We have prepared a set of suggestions to help you make the best choice.

Why decide to buy a property?

When buying a flat, house or commercial unit, you need to take many important factors into account. Buying a property is one of the most important decisions in life, so your actions in this area should not be driven by emotions. Emotions are a bad adviser; investments made on the spur of the moment often generate more losses than profits.

If you are considering buying a property, e.g. in Katowice, pay attention to:

Your financial situation – do you have your own funds, that is, cash with which you could complete the purchase in full, or would you like to apply for a bank loan? Or perhaps you can pay a partial deposit (down payment) that will significantly reduce the cost of the monthly instalments. Remember that if you have no savings, it will be harder for you to repay the instalments. You need to start saving now.

Exchange rates – if you choose a loan, check current exchange rates and choose the most convenient solution, which will make it much easier for you to repay your loan obligations. Pay attention to fluctuations in the Swiss franc, dollar and euro exchange rates. A loan in PLN is currently the most popular form of property financing, owing to lower margins compared with foreign currencies.

Government programmes – they provide excellent financial support for young people interested in buying their first flat.

Arguments in favour of buying a property:

• Owning your own flat or house shows a practical approach to investing. If you unexpectedly lose financial liquidity, you can sell, swap or let a property you own.
• Monthly loan instalments are similar to rent payments, except that by repaying the loan the owner invests in their own future.
• In the future the property can provide the owner with additional retirement income through a reverse mortgage.

READ ALSO – BUYING A NEW FLAT BEFORE SELLING THE OLD ONE

Why decide to rent a property?

The pool of flats to let is steadily growing, and units of average standard at a relatively low rent are very popular. Renting is most often of interest to young people: students and people starting out on their life and professional path who do not yet have significant savings. It also happens that companies rent flats for contract workers. Demand for higher-standard units comes from wealthier people.

If you are considering renting a property, pay attention to:

Your financial situation – analyse your own finances, draw up a plan and think about how much you can spend on monthly rent. Make realistic assumptions and save.

READ ALSO – A FLAT IN EXCHANGE FOR CARING FOR AN ELDERLY PERSON

Arguments in favour of renting a property:

• There is no risk of loan default.
• Renting is an ideal solution for people whose financial situation is unsettled.
• The monthly cost of renting is similar to loan instalments, and you can end the tenancy at any time.

According to Statistics Poland (GUS) research, 17% of Poles rent their homes, while as many as 90% own a flat or house! Before making a decision, examine the state of your finances in detail!