First, how are you doing financially? Do you have a steady income or enough savings that making a down payment and buying a home makes sense right now?
Oftentimes, the decision to rent or buy comes down to three things: money, love and your job. If you have plenty of money in the bank, a spouse and/or kids, and a stable job, then buying a home makes sense. If, however, you’re living paycheck to paycheck, considering a move somewhere else to be closer to your lover and/or kids, and sending out resumes in hopes of finding a new and better-paying job, then renting is the best choice for now.
In general, if you plan to stay in a location for a long time– years, not months– then buying a home is a good decision. For instance, if you have made a plan to live somewhere for five years or less, then renting a place is a good idea. But if you’re fine with living in that area for more than five years, then buying a house should be your priority.
Also, take into consideration the monthly costs of renting versus owning a home. Rents typically include expenses like water service and garbage collection. Owning property typically involves paying more/higher taxes. Repairs for both rentals and owned units should be taken into consideration. Your budget needs to allow for fixing broken down water heaters, leaking pipes and other things that occur over time.
Finally, consider the market. Some regions have homes that appreciate in value as time goes on, while others lose their value. A home you buy for $100,000 this year could be worth $200,000 in ten years, or it could be worth $50,000. How’s the economy of the overall area doing? Are people flocking to the area for jobs or is it a “dying place?”