You’ve probably heard friends or family members debating this housing question. Should we keep on renting or buy a house? If you haven’t been in on those discussions, a quick online search of “rent vs. buy” will land you almost 10 million hits. And people are passionate on both sides.
Some stress that the American dream of owning a home is what matters most. While others are convinced renting long-term is the best decision for many.
Popular shows on HGTV like Fixer Upper, the Property Brothers, and House Hunters are all focused on owning a home. You can’t fix up or remodel what you don’t own.
Whether it’s a starter house, one you’re downsizing into, or your forever home – our lives and screens are filled with messages that home ownership should be your goal.
But the reality is many people can’t afford to buy a home or don’t want to. Some live in expensive areas where the high cost of living prevents them from qualifying for a mortgage.
Others have different ideas about how to invest their time and money. And new research by Freddie Mac finds even though there is “growing economic confidence among renters, affordability remains dominant in driving renter behavior.”
Since there are almost 46 million households renting their home and more renters now than any time in the last 50 years, it makes sense to look at reasons why renting is the best decision for some people.
Benefits of Renting
Lower Monthly Payments. Although it isn’t true in all areas of the country, renting does save most people money each month. Monthly rent payments are usually less than mortgage payments that include taxes and insurance. And some tenants even get move-in bonuses or a free month as an incentive to sign a lease.
Utility, Maintenance, and Repair Costs are Minimized. Some leases include select utility costs like water and sewer. Maintenance charges for mowing, snow renewal, and trash collection are also part of many rental leases. At some larger apartment complexes, cable and internet are even included as standard services in monthly rent payment.
Renters also have limited responsibility for paying for repairs and maintenance for their unit unless it is part of the lease. And maintenance and repairs are something many new homeowners underestimate when making their monthly budgets!
More Flexibility. Since leases are usually for one year or less, renters who are unhappy with neighbors, their job, or their apartment have the flexibility to make changes more often than homeowners. There are steep costs involved with any move, but changing rental units requires application fees and security deposits, not expensive realtor fees and closing costs.