When it comes to finding a place to live, one of the biggest decisions that all of us have to make as individuals is whether to rent or buy. Both options come with their own set of advantages and disadvantages, but the choice ultimately depends on someone's financial situation, lifestyle & future plans.
Keeping these details in mind, we're exploring the benefits of renting real estate versus buying real estate to live in, so that you can make an informed decision when you're living around the Red Sea.
Benefits of Renting Real Estate
Flexibility: Obviously, one of the biggest advantages of renting real estate is the flexibility it offers. Renting allows you to move frequently if you'd like to, without the burden of having to sell a property, which can often be time-consuming and costly. This in itself makes renting a great option for individuals who value flexibility, such as young professionals who may need to move frequently for work or those who are still unsure about their longer-term plans.
Lower Upfront Costs: Renting usually requires significantly less upfront costs as compared to buying real estate. Renters usually only need to pay a security deposit equalling 2 months rent, and first month's rent to move into a property, whereas buyers have to pay a down payment and complete instalments, or simply pay the full balance at once. This makes renting a vastly more affordable option for anyone who may not have the funds available for a large payment.
Lower Maintenance Costs: When renting, maintenance relating to normal wear and tear & general repairs of the residence are typically the responsibility of the landlord. This means that renters don't have to worry about the cost of unexpected repairs (unless they cause the damage through abuse), such as a broken air conditioner or plumbing issue. In contrast, homeowners are responsible for all maintenance and repairs, which can be unexpected, expensive and remarkably time-consuming to deal with.
Amenities: Many rental properties around the Red Sea, particularly those in El Gouna, Somabay and Makadi Heights tend to come with amenities. The fees for these amenities & related regular maintenance for any pool, pest control, garden areas and WiFi are the responsibility of the tenant. These fees are generally listed within the community services that you pay monthly for your home's expenses, in addition to electricity & water utilities.
Benefits of Buying Real Estate
Building Equity: One of the biggest benefits of buying real estate is the ability to build equity. As instalments are made, you build equity in your property, which can be used to finance future investments or expenses. This is particularly beneficial for individuals who plan to stay in their property for a long time.
Stability: Homeownership provides a level of stability that renting simply can't. Homeowners don't have to worry about the possibility of their landlord deciding not to renew their lease, or their rent being increased, which is actually quite commonplace around the Red Sea. Additionally, homeowners have the freedom to make changes to their property, such as painting or renovations, without having to worry about violating a lease agreement, however any renovations of any significance will generally require approval from the location's developer, for instance Orascom in El Gouna, prior to beginning any work.
Investment: Buying real estate can be a brilliant investment opportunity in El Gouna, Somabay and Makadi Heights, as property values tend to appreciate rather significantly over time in these destinations, ranging from 10% - 15% annually, which means that homeowners can often sell their property for a hefty profit down the line.
Our Summarising Thoughts...
As we mentioned at the start, the decision to rent or buy real estate around the Red Sea ultimately depends on an individual's financial situation, lifestyle and future plans... So all you have to do is decide what's right for you, in your situation. Renting offers you flexibility, lower upfront costs, lower maintenance costs and access to amenities. Buying provides you with the opportunity to build equity, gives you a sense of stability and an impressive potential for capital appreciation on your investment.
As with so many aspects of life, it's essential to weigh the advantages and disadvantages of each option before making an informed decision, which is precisely why you should be consulting with a real estate professional at Jossour, as they can help you clarify what's best for you, in your individual circumstances.