Africats Organization Is Moving Into Its Own Building! (Or, A Primer In Commercial Real Estate Investing)

ANNOUNCEMENT: We are currently moving into our own building in Bridgeport after much analysis on buying vs renting our own place.

The below piece is written by our CEO James B. Johnston about the thought process that he undertook in order to decide whether to rent or to buy.

We are finally moving into our own property next week!

Without a doubt, it may sound great not to have to write checks for rent every month. The safety of owning a house is sure to make you feel better, too – provided you don’t end up having financial problems because of owning one, that is. Timing and financing programs aside, there are generally a lot of advantages and disadvantages that comes with buying a house, as well.

Here are several points you will need to take into consideration when deciding between buying vs renting:

Buying a home means that you will gain equity if you keep it for a long time. This is probably the most important factor that comes with home ownership. Aside from that, you will also feel a sense of pride and accomplishment for buying one. Plus, you will get to express your personality and style through your home since you will be free to do with it as you please.

Now, here are several financial factors that you will need to take into consideration when deciding between buying vs renting:

When it comes to buying a home, you are placing money into savings with each monthly payment. Conversely, when it comes to renting a home, you are giving money to somebody else as an expense. Also, each time you pay for your mortgage, part of it will go to your equity. This works like a bank account, where you can draw on it when you need to. Plus, the real estate market keeps going up, so home values keep going up, too.

Buying a home comes with various interesting tax benefits, as well. Every interest payment that you make accounts to deduct taxes later on. This is not how it works when paying for rent.

Having said all of that, buying a home definitely sounds better than renting one right now. However, buying simply isn’t for everybody. Remember: everything has its pros and cons, so you will have to think about every factor involved in buying vs renting before making your decision.

Here are the responsibilities that you will need to take into consideration when deciding between buying vs renting, for example:

Buying a home is an investment in terms of time. If you are a home renter, you can move around the country as you wish. If you are a homeowner, you ill need to think about managing leaking pipes, mowing lawns and pruning hedges, amongst other things. This is not a problem if you own a condo in the famous KLCC enclave in Malaysia, for example… but if you are in Bridgeport like us then there could be a problem.

When you are a homeowner, you will also end up spending a lot of money on small home improvements and utilities. However, when you are a renter, you may have to pay for utilities as per your rental agreement.

Thinking about the pros and cons that come with buying vs renting can definitely be a challenge since the aforementioned factors might differ from one person to the next. Aside from your financial condition, you shouldn’t forget to think about your responsibilities in the matter and the overall benefits of each aspect, either. This way, you can make the smartest decision for you in the end. Now with our own place, we can run courses like the Africats Method out of our conference rooms.

Hope you get some benefit from reading this piece. Thank you for reading!

-James B Johnston, PhD (Westminster), CEO, Africats Organization

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