When Renting Is A Better Option Than Buying
For as long as most people can remember, they have been told over and over again that buying a house is always a better decision than renting. The notion that rent payments are akin to throwing money down the drain is an oft-repeated maxim that simply is not always true. The information that follows will outline the situations and circumstances in which renting makes far more sense than purchasing a property.
It is all too common for people to focus only on the sales price of a home and the monthly mortgage payment it will entail. However, these expenses are just the tip of the iceberg for homeowners. Home repairs and maintenance bills can begin piling up from day one in a house, and they can be quite substantial.
In a similar vein is the often overlooked aspect of property tax liabilities that come with home ownership. Depending on the locality in which a home is situated, tax bills can be surprisingly large and a real burden for those who do not plan carefully in advance. Renters, of course, are not on the hook for property taxes, something which can make this route much more sensible for those wishing to lower their monthly obligations.
A particularly frightening prospect for those who purchase homes is that related to a serious drop in property values. As was seen during the mortgage meltdown, a drastic reduction in home values can cause true financial devastation to large swaths of homeowners, essentially eliminating an upside to their investment. Renters, by contrast, can weather a storm virtually untouched.
Renting an apartment can also be a wise financial decision in terms of miscellaneous monthly expenses besides those related to repairs and maintenance. With home builders tending always toward bigger and better, the resulting utility costs can be extremely steep. By renting a reasonably-sized apartment, water, electric, and gas bills are almost always much smaller, and they are sometimes even included in the rent amount.
Flexibility is another critical aspect of renting that can make it a very appealing option for many. This is especially true for younger people who wish to retain the ability to move quickly to take advantage of a lucrative job offer. Older individuals who are considering downsizing can rent in the interim and make their ultimate decision when ready.
Though there are certainly situations and individuals for whom buying a home is a prudent decision that can bring substantial financial rewards, this is not the case for everyone. Those interested in predictable monthly costs, lower utility expenses, and unfettered mobility in terms of living situation and location should keep renting in mind.
In the end, there really is no one-size-fits-all answer when it comes to the perennial debate over renting vs. buying. The key is for everyone to closely assess their own finances, goals and objectives and decided in relation to those very personal factors. Doing so ensures that a sound financial choice can be made.