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Should You Rent, Buy Or Build Your House? A Short Guide.

Which One Is Best For You?

To buy, rent or build a house in Ghana isn’t an easy decision to take. And for that matter, anywhere else. However, the Ghanaian Properties Industry or Real Estate sector has unique challenges which make deciding even more difficult and stressful. 

According to the Ghana Living Standards Survey Round 6, More than half of the Ghanaian populace live in compound houses (60.6%). Another 2 out of every 5 households own their homes. Among other issues, the Ghanaian system has a lot more to do. That includes your decision to rent, buy or build. Estimates indicate that Ghana has a housing deficit of 1.7 Million Units. This culminates to an annual requirement of 85,000 housing units if the demand and supply gap is to be closed, eventually. 

Renting in Ghana comes with its unique challenges. So does buying or building your house. For each decision you take, it comes with its own pros and cons. That said, this article will break down some of the issues you need to consider before making a decision. The caveat is that you need to consider them from your own condition and assessment of your needs vs your wants. What you need isn’t necessarily what you want. 

Before getting into the nitty-gritty of whether to rent, buy or even build your own home lets consider some of the main reasons why making such a decision is even more important.

Why Consider The Ownership of Where you Stay?

Depending on your plans, your goals and where you work or do your major activities, you would have to consider your space of living critically. It makes sense to have a place to live near where you work since much of your day is spent around. This strategy reduces transportation costs and drastically cuts down other costs in relation to that. However, it isn’t always possible to do this. 

For instance, you work at a place where it is expensive to rent, buy land to start building or even to buy a house. You may not have even saved enough to consider buying and building. This leaves you with the option to rent, as most people starting out in life do. 

Why Buy a House?

On why you should consider buying or building your own house as soon as you can save up to start. Buying a house or building (That is owning your house in both cases) you have a lot of conveniences, greater levels of customisation for the look, feel and facilities available and also peace of mind. For buying a house, you may not have so much customisation. This is because the house has already been built but the good part is you get to choose which one suits your wants and needs. 

Owning where you live also means being able to build equity over time. Real Estate generally appreciates in value over time. This allows you to sell your house at a higher price if or when you decide to. In certain locations, this may be dramatically lucrative. 

In some cases, it simply makes sense to build or buy a house since renting is far more expensive than buying or building upfront. 

Besides owning it adds some self-esteem and boosts your confidence in your activities an way of living. You no longer worry about the headaches of renting, obeying rental rules of landlord and enduring rent increases.

What Does It Mean To Rent And What Does It Take?

Renting means having to pay huge down payments for rent mostly one or two years advance. In addition, you have to obey the rules given by the landlord regarding the use of the property. It comes with rent increases as and when the landlord wants. You have to live with other tenants based on the property structure. In compound house cases, you may have to share basic facilities such as toilet and bath. Rent rates are widely varied based on the property and location. Urban areas are more expensive. Certain locations within these areas also have high or low average rental costs. 

One huge factor, a disadvantage, is lack of control over things that matter. A Landlord, at any time, can decide to sell the house or property. Hence, you have to either buy it to keep staying there or move. This causes a lot of unforeseen stress and challenges. 

Pros Of RentingCons Of Renting
1. The landlord takes care of maintenance (Not always)
2. Allows you time to save up to buy or build later.
3. You can decide to leave when need be. You can’t leave your owned house unless you sell. 
1. Rent increases at anytime
2. Rules on how to use property, restrictions and being liable to the landlord
3. The landlord may sell the house, to which you buy or leave for the new owner.
4. Paying huge upfront costs (1 or 2 years in most cases)
Pros and Cons of Renting

What Does It Mean To Buy And What Does It Take?

The chief benefit of buying a house is the convenience it presents. It doesn’t always present a lot of customization. The property at the buying stage is already planned or built. In estates and planned developments, buildings are designed often using a general design outlook. 

Buyers may be able to choose between homes with certain facilities but cannot make certain changes at that stage. That aside, if you are a busy person, have the finances and have been able to find a place that you like, then it would be a good idea to go for it. However, pay attention to the valuation of properties and other factors in order to get a fair deal.  

Pros Of BuyingCons Of Buying
1. Convenience and some level of customization. 
2. You get to pay for the house over time
3. Freedom to change the building anytimeMortgage benefits
1. Rent increases at anytime
2. Hard to relocate since your house is permanent unless you sell. 
3. You are in charge of maintenance as often as need be.
Pros and Cons of Buying

What Does It Mean To Build And What It Takes?

Building a house, especially self-supervised is a highly stressful and daunting experience. It takes time, money and mental stress. If you decide to build, you can work with a contractor who will be in charge of project planning and execution. Of course with your preferences and approval. 

You can also decide to get a foreman or mason who will take care of the actual building. The difference is, the contractor takes care of paying workers, material sourcing while the mason will mainly do the work while you pay attention to the other aspects. 

A contractor is paid based on the overall project. An agreement on cost, timelines and design. The execution is then up the contractor. Masons work with your schedule, availability of funds and you typically have to supervise the work or get a foreman to do that. The Materials could typically get missing or misappropriated hence strict supervision from a trusted person is required. 

Pros Of BuildingCons Of Building
1. Highest Customization opportunity
2. An investment as real estate generally appreciates in value.
3. You can change the building at anytime
4. Property tax benefits
5. Privacy
6. You can rent it out
1. Too many details involved in building
2. Cost implications
3. Involves long-term commitment for completion especially when you haven’t saved enough.
4.  You solely take care of maintenance and repairs.
5. Permanent residence unless you choose to sell and move.
Pros and Cons of Building

To Buy, To Rent Or To Build? All You Need To Know.

When deciding, make sure to consider the Convenience and Flexibility. Is buying better? Is renting more flexible and convenient now? Perhaps I should rent now and save up to buy or build later. 

Also, look at the Processes and Costs involved. Building incurs the most stress since there are many decisions and moving parts to be assembled. Renting involves the least paperwork once you have funds to pay the required period. 

Buying is a great option if there is the need and you have the funds to see it through. Take into consideration Maintenance and other variable costs after the house has been acquired through any of the options. With building and buying, you can build Equity. This will enable you to sell at a higher price later on. 

Conclusion

All is said and done and it is time to make the decision. Oops! But not yet. Contact people from the various rental properties, developers and civil contractors for advice and more insights into what details you need to make a decision. Do some research and then decide after you have gained enough information about each option to make a decision.

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