Wetzel Services Newsletter

This is one of the most common questions I am asked by International Executives. They arrive -- without the benefits of a social security number, American credit history, or market knowledge – and immediately face this choice.

Can I give you a catchall answer? No. But I can give you informational tools that will funnel you toward the right choice for your circumstances, and better equip you to buy if you choose to. Now before I hand these over, it’s caveat time. Let me shout loud and clear that I am not an international tax guru, legal expert, Certified Financial Planner, or prognosticator of the future real estate market. What I am is a real estate broker, and any broker – myself included – smiles like an Italian soccer fan when you decide to purchase. The commission is much higher. We know our risks and rewards; you need to know yours. I’ll present them to you in 3 parts.

Part 1 is an overview – a quick look at the general advantages of each option. It may answer the question for some. For those still considering a purchase, Part 2 goes into greater detail about the risks and rewards of buying. And Part 3 describes ways to work through the obstacles of obtaining a loan and making a purchase without a credit history.

Some General Benefits of Leasing and Purchasing

Leasing

Leasing is quicker. It is sometimes possible to find a leased home, sign the lease, and begin occupancy in a very short period of time. We have helped tenants move into a home within days of arriving. A purchase takes longer -- around 30-45 days to close once the terms are agreed upon.
Leasing is normally maintenance free. If you don’t want to worry about roof leaks, plumbing problems, or HVAC headaches for your term in the US – leasing is a better choice.
Leasing has less risk when moving back to home country. Renting is especially beneficial if the company may shorten your contract term. Normally the maximum penalty is around one month’s rent (e.g., if the company relocates the tenant outside a 50-mile radius with 60 days written notice).

Purchasing

Purchasing offers more housing options. There are simply more houses for sale than for rent, especially if you’re looking for a higher-end executive home in the Upstate. If you have specific expectations or special requirements, they will probably not be met by a rental property. If you need all hardwood floors, a fenced yard, a screened porch, and a home zoned for a particular school – then you may need to purchase.
Purchasing allows you to make changes to your home. If you want to decorate - to paint all the rooms sunshine yellow, tear out a wall, or add a porch – you probably need to own.
Purchasing lets you have pets. Many landlords are not thrilled about leasing homes for pets.

In the next issues we will look at some of the money topics involved with purchasing – exchange rate risks, market risks, tax consequences, and the approval process.