Moving into a new home can be stressful. It requires nearly inhuman levels of organization and logistics, as well as its cost. You generally have two options when it comes to choosing a home — buying and renting. What do you need to know to decide whether you should buy or rent your next home?

What Does Your Five Year Plan Look Like?

Before you start browsing Zillow looking for your dream home, you need to reflect. What does your five-year plan look like? Do you see yourself staying in the same place, building a career with the same company, and building a life? Or do you see yourself working from home — as many of us are these days — and moving every six months to explore the country?

If you don’t have a five-year plan or scoffed at the idea of making one, that is where you need to start. Figure out where you want to be and where you see yourself. If moving around is essential, renting is going to provide the best flexibility. If you prefer to settle down and put down some roots, then you might look into buying a home.

Crunching the Numbers

The most challenging part of determining whether to buy or rent is crunching the numbers. You need to figure out what you can afford, what your credit looks like, what your income looks like, and how much you can save for a down payment.

Most mortgage lenders require that you can make a sizeable down payment on your mortgage, from 15-20% of the total cost of your home. That means if you have a $200,000 home, they’ll expect you to have $40,000 on hand for a down payment. The more you can put down, the less you’ll have to pay overall. Your mortgage payments may be less than a rent payment per month, but the initial investment is substantially higher.

If you’re unsure where to start, consider talking to a mortgage professional or an accountant to see where you stand and whether you can afford to buy a home.

Perks of Owning

Owning a home might be more expensive initially, but it does have plenty of benefits. You can avoid a continual rent increase, and if you can take advantage of purchasing when the housing market and interest rates are low, you can turn it into an investment rather than continuing to sink your money into rent payments. On the downside, you are responsible for all of your repairs and the cost of improvements, and you will have to purchase homeowner’s insurance. In general, these downsides aren’t enough to discourage people from owning a home.

Perks of Renting

Renting might be more expensive in the long run, but there are some benefits as well. Your landlord or property manager is responsible for the property’s maintenance and any repairs that might crop up in most cases. There may be instances where specific repairs are written into your lease as your responsibility, but these are on a case-by-case basis. You may even find a rental property with amenities like a pool or gym, or one that includes utilities in the rent.

The downside of renting is constantly rising costs and limited decorating options. You can’t paint the walls or remodel the property if the whim strikes you.

Are You Ready to Be a Homeowner?

Ask yourself, before you make a decision, are you ready to be a homeowner? It sounds like a simple question, but there are many variables that go into that answer. Make sure that everything is in place before you start hunting for a house or applying for mortgages.