For many, homeownership is a mark of success; it checks off one of the boxes on the long list of accomplishments that bring us closer to achieving the “American Dream”. In the case of most Americans, we attach the idea of owning one’s own home to a sense of pride and fulfillment. However, in the face of all this ingrained pressure to purchase a house, we tend to forget certain aspects of homeownership. Not everyone is in a place, either financially or emotionally, where they can be ready to make such a huge commitment at this point in their life. Sometimes the economy isn’t right. And sometimes, people may live a kind of lifestyle that simply makes purchasing a home impractical. So whatever your situation – whether you plan to eventually own your own home or not – here are some of the benefits of renting.
Renting is More Flexible
Owning a home is a considerable long-term commitment for one’s finances: once you make that down payment, you’ve tied yourself to that location and the expenses that come with it. Breaking that commitment is very difficult, and entails additional costs and difficulties regarding buying and selling a house. Renting a home, on the other hand, is structured differently. Renting comes with a short term commitment that is outlined in your lease; you are only bound to that home for as long as the contract says. When that period of time ends, you can choose to either renew your lease or to notify the landlord that you will be leaving. This provides the flexibility that homeownership cannot: if your financial situation changes, or you find that you need to relocate, renting allows you to be in a home that best fits your situation.
Lower Monthly Costs
Another benefit of renting versus purchasing are the lower monthly costs associated with renting. When thinking about monthly costs, our minds tend to go to one place: rent. And more often than not, monthly mortgage payments tend to be higher than rent. There are other bills to consider as well: both utilities and insurance are ubiquitous to living in a home. However, both of these costs are significantly lower when renting a home rather than owning one. Especially for single-income families, those high monthly payments are impossible for their current financial situation. This impracticality becomes even more evident when we consider the long-term attachment to those monthly costs that come with homeownership.
Less Responsibility for Maintenance
When you take on the ownership of a home, you’re taking a lot more ownership than just that piece of property. Owning a home means being responsible for the everyday wear and tear that a home accumulates just by existing: leaky roofs, faulty air conditioning, and old hot water heater will all be expenses that come out of your pocket. Renting a home takes that responsibility off of your shoulders and places it on the landlord’s; the only maintenance you have to take care of are the things that you are responsible for.
As we can see, there are a lot of short and long term costs associated with owning a home. Your wallet faces a huge down-payment, maintenance costs, and monthly mortgage, utility, and insurance bills. All of these are either significantly lessened or completely eliminated by renting. And there is one more that we should be thinking about: taxes. While the exact amount varies from county to county, every homeowner pays the price of owning property through property taxes. Over time, this drain on your paycheck can become a real financial burden. Renting takes this burden away. As a renter, you have a significantly stronger hold on your finances than a homeowner. The government doesn’t control your finances; you control your housing budget with your own actions and choices.
Everyone’s situation is different. Not everyone can be in the right place to buy a house, and not everyone has the kind of lifestyle that is suited for homeownership. Making the choice to rent is the best and most practical option for many Americans. When making that choice, it’s important to know all of the advantages and disadvantages in order to make a well-informed decision that is best for you or for your family.
By: Hannah Champion