Q I know it doesn't have widespread appeal, but have you any advice for people in the United States on H1B or L1B visas and what makes more sense: renting or buying?
I'm helping four foreigners move to the United States from the Philippines. Some people are still on the homeowner bandwagon: BUY BUY BUY. But their visas are limited.
I think they should rent until they know if the company will help them apply for permanent residency. Some say, if they leave, then rent their homes until it is a good time to sell. Yeah, I did that in the 1980s and lost my condo "investment."
PAMELA
A The particulars of your question are different, but the answer isn't unique to workers in the United States on a visa. I would give the same answer to them as I would to anyone considering the buy vs. rent decision. The key factors to carefully think through for rent vs. buy decisions are finances, income and time.
Before I get to the specific factors, I want to emphasize that both homeownership and renting are attractive choices when it comes to lifestyle. With a home, it's up to you and not your landlord whether you have pets. You can decorate your home any way you want and garden if you have a yard.
Renters don't have to worry about repair and maintenance. That's the landlord's responsibility. The old real estate saw that renters are "throwing their money away" is wrong because renters can easily set up a monthly savings plan to build up equity. Now, to the specifics:
Finances: I think we've all learned from the housing boom and bust that it doesn't pay to stretch your finances to own. The traditional guideline of don't buy unless you can put down a 20 percent down payment or more is still best. (That's a difficult hurdle for many temporary workers to meet even though they're earning a decent paycheck.)