Lake Chapala – To Rent or To Buy

April 13, 2013

After you decide you want to live at Lake Chapala the next thing you need to decide is if you should rent or buy.
Most people, at least initially want to rent to be sure the area is right for them before they make this decision. My advice is to do what you’re comfortable doing.
If you think it best to rent first or forever then do that. Everyone’s situation and temperament is different.
In my case I knew immediately I wanted to buy so only rented long enough to find the right home at the right price. I rented for about 3 months.
Here’s what I think is a practical way to decide if it’s better to rent or buy.
If you think that you have 8 to 10 years (actuarially speaking) or more life ahead of you or that your spouse would have that long and would want to stay in the area even if you were gone then, yes, it makes a lot of sense to buy.
Here’s why I say that.
I saved enough in 10 years of not paying rent to pay for my home.

After that period is over (what ever it works out to be for you) you're just accumulating wealth.
And, if the market goes up over time, as I believe it will, due to the trend of retirees locating in less expensive areas that just makes it smart to buy, as soon as you know that you want to live here either full or part time.
Permit me a short war story. Back about 16 years ago, my first wife and I made some good friends at Lake Chapala who had lived here a long time.

They had rented for a number of years at that point. He always wanted to buy, but she insisted that they rent.

She loved to swim and really wanted a home with a pool. I guess there were no suitable rentals with a pool, so she asked the landlord for permission to install a pool at the home they rented.
The owner gave permission and the pool was built, A couple of years later it was time to renew the lease. The landlord then substantially raised the rent.

They moved to a place they could afford without a pool.

The moral of the story is that in a rental you're not in control of your future except for the lease period. Nothing wrong with renting, just be sure and do the math and be sure of the rental terms.

Siempre tu amigo, Sid

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