Buy or Rent? How to Determine What Makes Sense for You

It can take several years for a home to appreciate enough to be worth the investment, while people who rent can invest the money they would've dropped on a down payment in stocks instead and possibly make a killing. However, it's important to note that both of these scenarios come with a big "if." Since either option is a complete gamble, if you feel the need to maintain some flexibility in your life, renting could be the route to go.

If the rent ratio is sound, then it might be time to settle down. That way, instead of potentially seeing your rent go up, you'll possibly be seeing the value go up in what's almost certainly your largest investment.

It's true that renters typically pay a deposit if they have pets, but that's also meant to cover all the damage those pets will potentially cause. So while someone who owns their own home doesn't have to shell out a couple hundred dollars just to get their dogs or cats in the door, they'll be the ones footing the bill when the dog ruins the hardwood floors or the cat tears up the carpet. This one is pretty much a draw.

Buying a home means you enjoy much greater flexibility when it comes to activities like sprucing and upgrading, whereas people who rent often don't have the option to customize and can sometimes lose their security deposits for even small alterations to their apartments.

Owning a home is a serious financial commitment. Costly repairs can pop up unexpectedly, upkeep can drain your wallet and then there are expenses like property taxes and homeowners insurance. Bottom line, if you can't keep a budget and save up some spare funds, you might be better off with the lightened responsibility that comes with renting.

It's a tough call. On the one hand, if you chose an apartment in the same neighborhood, chances are good you could manage the rent. But on the other hand, this is a question of where you want to live. That's a big deal, although it's easy to lose sight of it. You're going to have to go with your gut on this one.

If nothing thrills you more than the idea of creating a garden, covering your cupboards in mosaic stones or installing a built-in bookshelf, you'll definitely want to consider buying. Remember, some landlords get upset about small nail holes in the walls -- what would they say when they discovered your decorative flair?

If you enjoy dealing directly with people and skipping the corporate hassle, renting from an individual could be the best option to consider. But if you're leaning toward buying a home, there are real estate agents, brokers, appraisers, inspectors and lenders to deal with, and hey, they're people, too!

It's true that your rent can go up, but your property taxes can, too. It's a tough call all around, so just get out there, do some research and decide what's going to work best for you and your situation!