With tons of bargain deals available in today’s market, first-time homebuyers are in prime position to make good choices about their first property purchase. 

So, is it best to take advantage of the once-in-a-decade opportunity to own a home, or is it better to be investing instead?

Advantages of buying for own-stay:

Freedom to Own

The most obvious plus of owning your own home is being able to customise it to fit your own style. That “dream home” you always imagined will soon become a reality with your newly found freedom to renovate, design and add anything and everything your heart desires.

Stability and peace of mind

Another plus of owning your own home is that it gives you peace of mind for the future as compared to renting.

When you rent a property, there is a level of uncertainty as to how long you can stay in this property. The landlord may be selling up their property one day and you may be requested by the new owner to move out.

Meanwhile, rent often goes up once in a while and it could increase to a level that is beyond your affordability.

Build your credit profile

Prompt payment history on your mortgage is a powerful tool to build a solid credit profile that can go a long way in your financial and investment.

As you make consistent payments and reduce your mortgage loan balance, your credit score should go up more than paying debts such as credit cards as credit bureaus often give more weight to a mortgage payment history.

Advantages of investing in a property:

Enjoy flexibility in your lifestyle

If you are not ready to be tied to a mortgage and are unable to frequently change the location you live, then buying a home may not be a good choice for you.

Instead, you should be considering investing in a property that is able to generate extra income that can improve your financial status in the next few years, so that you would have enough funds to make a purchase of your ideal home when the day comes.

A new cash flow every month

There are plenty of motivated sellers who are looking for a taker for their property in the market and due to the current challenging economic landscape, some of them are urgently in need of cash and thus willing to let go of their property at a lower price.

This offers a rare opportunity for buyers to choose from a range of good-quality investment-grade properties that were selling at a relatively higher price and some of them may even be tenanted and provide immediate rental income for their new owner. 

Your investment can help you leverage into your home later

Owning an investment property doesn’t necessarily mean that you won’t be able to afford your actual home. Nor does it mean that you won’t buy it at some point. 

In fact, wisely purchased investment properties that grow in value can provide you a substantial amount of equity and wealth and you can opt for a refinance to capitalise on the increased value of your investment property to come up with the deposit and loan required for your next purchase.

The bottom line:

In general, owning a property is a really good investment as it not only help to build you wealth with the value appreciates over time, but also provide you a better lifestyle through the rental income or a comfortable living space.