WHY RENTING IS THE NEW OWNING
- Posted By Prince Lakshman
About 30% of all Aussies now live in a rental.
Since 1991, the rental population in Australia has swollen up from 26.9% to 30.9% and home ownership has gone down from 68.6% to 65.5%. Almost as many Australians now rent as own their property outright.
So why do many people now prefer renting than owning?
There are, of course, pros and cons of renting.
In general, people rent to live in an area where they love, but can’t afford to buy into. This allows them to enjoy a lifestyle that’s otherwise unachievable if they were paying a mortgage.
Renting also allows people to live in a property without the same running costs as owning. This means they are not responsible for repairs, maintenance, council rates or levies.
However, renting doesn’t mean people can’t own a property.
Rentvesting- a trend wherein a person buys an investment property in a cheaper location and renting a home elsewhere- is now the new gateway into the property market.
If you put your investment property into rental, it can help you service a mortgage, makes you a player in the property market, and gives you the ability to claim appropriate tax deductions.
As much as there are pros, there are also cons when it comes to renting. Tenants can obviously make changes to the property without the permission of the landlord. However, tenants can put their own personality on the property through photo frames, furniture, and other individual items that don’t affect the property.
Tenants are looking for different features in a property, but what attracts renters can change over time whenever a major family change happens, such as the addition of a family member or a divorce.
Long-term renters can be major assets to their landlords if they pay their rent on time and maintain the property as though it was their own.
There are landlords who don’t increase the rent during lease renewal time because they’re happy with the tenants’ conduct.