Advantages of Renting Vs Buying
To own a home with a white picket fence, beautiful yard with lush green grass and a golden retriever – that’s the epitome of the American Dream. Over generations this ideal has been etched into the minds of many Americans. Most people consider renting the equivalent of flushing money down the drain. Why is that? Let’s explore some advantages of renting vs. buying:
Financial expert Jill Schlesinger for CBS’s Money Watch segment encourages renting. “Don’t feel pressured into buying a home, Renting can often be a smarter financial move”, she cautions. You have to go through and say, ‘Okay, if I’m going to buy a half million dollar place, I have to put $100,000 down, then I’m going to have a mortgage, and then taxes, then I’m going to have insurance, then I have maintenance (which is a pain in the neck, by the way).” Then, you need to really look and say, ‘What’s the comparable rent that I could pay to get pretty much the same thing?’, you may find that it’s going to cost you $6,000 to own, but only $3,000 to rent. Keep renting!”
Our Top 10 advantages of renting:
1. Luxury Living: When renting you might actually be able to enjoy living in that luxury ocean view condo which you would never be able to afford to buy.
2. Perks and Amenities: A lot of apartment communities have swimming pools, gyms, tennis courts and might include other perks such as free morning coffee or even breakfast.
3. Included Utilities: Often rentals include water and heating saving you a bundle of money at the end of the month.
4. No Yard Work: If you have ever pushed a lawnmower or pulled weeds in the summer heat, you’ll appreciate the fact that rentals usually include the yard maintenance.
5. No Property: Taxes and Insurance: As a renter you don’t pay property taxes or homeowner’s insurance, which can be quite expensive.
6. Repairs: What do you do when a pipe bursts or the roof starts to leak? As a renter you simply call your landlord and it will be taken care of at no cost to you.
7. Cash Flow: Renting is cheaper than buying, requiring less cash up front thus increasing your cash flow.
8. Flexibility: Renting makes you more flexible in the case you have to relocate. When that dream job in another state calls, you can move by the next month.
9. No Risk: The housing market fluctuates. If you have to sell your home in an economic downturn you might lose money. As a renter you will instead receive you deposit check back (in most cases).
10. Fixed Cost: When renting your monthly you have monthly fixed costs, which can greatly fluctuate when owning a home due to unexpected repair costs etc.