Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I am sure this has been discussed many times, but I feel like it's a question worth asking. I have never owned a home, and currently rent. I am in the process of buying my 1st home (m if the sellers fix the issues on the home inspection ) and I am beginning to question just how much better it is to buy. I will list of all of the pro's for renting first.
1- Cheaper ( my apartment pays all utilities )
2- Less stress ( Repairs on not a concern )
3- freedom ( A lease is not a multi year commitment )
4- no pressure ( I think that a homeowner is probably always worrying about their home...maybe not )
Feel free to chime in on what you think is best! buying...or renting!
Renting is not always cheaper. In some markets rent may be less than a mortgage payment. Many apartments do not include utilities. Also, when you're paying rent, you have nothing to show for it. If you rent the same apartment for 15 years, you don't have anything. If you pay your mortgage for 15 years (many of us have done this), then you may own your own house that, typically, has appreciated so it's worth more than you paid for it. You also may be able to deduct your mortgage interest and property taxes from your income taxes....can't do that when renting!
Repairs at apartments are done whenever the landlord feels like by whatever cheapo repair guy they can find. I have a friend who has had to deal with a leaking ceiling for 5 years in an apartment. It's been repaired at least 12 times. If she owned the place, she could hire a real contractor and get to the bottom of the problem so it could be corrected properly.
Freedom? Oh yeah you can paint whatever color you want. You can put in whatever flooring you want. You can get whatever appliances your little heart desires. Hate oak cabinets? You're free to change them! Want a fenced in yard, no worries. You want a pet, not a problem! Want a roommate, again no problem.
Pressure? What pressure? No us homeowners don't sit there all day and night and worry about our house. What's there to worry about? If something breaks, you find someone to fix it. No biggie. Major problems are rare.
I have zero desire to ever rent again. When we got married, we hated renting. As soon as we could we bought a house. We can't imagine EVER renting again!
Well, thank you everyone for the replies thus far. I guess I am getting cold feet-I don't have a ton of $$$ in the bank, and while this home does come with 1 year warranty, I have heard the horror stories dealing with that. My apartment currently is about 500 square feet, but it's on the 3rd floor and nobody likes visiting. I think the main reason I am concerned is-I don't want this home to be a money pit; at the same time I am excited by the prospect of owning something. I believe if you OWN something you are more likely to dote over it, and make sure it's in tip top shape but I could be wrong.
Wow! Where I live now, you couldn't touch that for twice that price, not that anything like that is available....
It's interesting how that works, isn't it? I wonder if the difference in salaries makes up for it, I doubt that it does. (In truth, I have no idea. Going to look it up in a minute, so.)
Owning a home is a nice way to live, but it does come with added responsibility. Make sure you have some money in your budget for maintenance, and if there are any major elements of your house that are near end of life you should have a plan for replacing them. For example, if the roof is 25 years old you know it will not be too long before it need replacing.
I simply can't imagine wanting to rent. If for no other reason, my home is my castle. If I want to change something, I change it. If I want pets, I can have pets. I don't have to worry about my house being sold out from underneath me. I don't have to deal with a landlord wanting to inspect the place. Also, the worst neighbors tend to be renters. All my neighbors also own their own home. We get along great. No problems and no conflicts. There is one house way down the street someone is trying to rent out. At over $200 a month more than I pay. You can find something cheaper. Like an apartment. But there is no way I would ever want to live in an apartment. You can crunch the numbers any way you want, but in the end, it's more about the quality of life than money.
Well, thank you everyone for the replies thus far. I guess I am getting cold feet-I don't have a ton of $$$ in the bank, and while this home does come with 1 year warranty, I have heard the horror stories dealing with that. My apartment currently is about 500 square feet, but it's on the 3rd floor and nobody likes visiting. I think the main reason I am concerned is-I don't want this home to be a money pit; at the same time I am excited by the prospect of owning something. I believe if you OWN something you are more likely to dote over it, and make sure it's in tip top shape but I could be wrong.
Not necessarily. My house is less than a year old and was designed to be trouble free. I'm retired and I expect it to not need any major repairs during my lifetime.
I simply can't imagine wanting to rent. If for no other reason, my home is my castle. If I want to change something, I change it. If I want pets, I can have pets. I don't have to worry about my house being sold out from underneath me. I don't have to deal with a landlord wanting to inspect the place. Also, the worst neighbors tend to be renters. All my neighbors also own their own home. We get along great. No problems and no conflicts.
I've lived in my own house for most of my adult life, and can't anticipate changing that. Owning is not without problems, however, and neighbor problems can be some of the worst.
At the first house I owned there were two homes behind me with dogs that would bark incessantly. One was a rental and the other was owner occupied. I walked around the block and talked nicely with the owner and the renter. They were polite, but basically said there was nothing they could do about the situation. The city would not issue any sort of warning unless there were complaints from multiple addresses and none of my other neighbors would get involved. So I was effectively living in a detached apartment with a lawn that I had to mow but couldn't enjoy. I ultimately moved because of this, which is not cheap
A friend of mine also ended up moving because of a mentally ill neighbor causing problems, and again the authorities apparently could not do anything about it.
I'm much more careful now when I buy a house, but even so the house next door could sell and then I end up with neighbors from hell again.
Not necessarily. My house is less than a year old and was designed to be trouble free. I'm retired and I expect it to not need any major repairs during my lifetime.
I bought my house brand new because I wanted to be sure I wouldn't have to deal with repairs for at least a few years. It didn't work out that way for me at all. We had to have really major foundation work done the fourth year we were in the house. It was covered by warranty but it was still a huge hassle because they didn't cover moving our belongings or a place to stay while the repairs were being done, but the repairs were so major we couldn't live in the house while they were being done.
A lot of people aren't considering all of the important information when making these comparisons. Renting is sometimes cheaper than buying, but it primarily depends on a few important factors.
First, at cheaper price points, buying is usually a better financial bet in the long run. A $100k house might rent for $1,000 per month, but a $500,000 house won't rent for $5,000 per month. At subsequently higher price points, the renter is getting more house for less money.
Second, there is an opportunity cost that comes with your down payment. Historically, housing appreciation rates roughly correlate with inflation. You can probably beat inflation by a large margin in an investment, so your down payment will yield better returns when invested in something other than a house.
Third, while a renter doesn't get any rent money back when selling, a buyer doesn't get any mortgage interest or property taxes back when selling. He or she also doesn't get back most funds devoted to repairs.
To generalize, I would say the following are probably true:
- If you're going to be in the house for less than a few years, you're probably better off renting unless you get a steal of a deal.
- If you're looking at a house that is under $300-400k, you're probably better off buying if you're looking at being in the house for the long run.
- In some markets, renting can end up cheaper for a lot of people, but the reverse is true in other markets.
Simplifications like "I threw money away renting" or "when you buy, you're building equity" aren't properly considering all of the important considerations.
Waking up tomorrow morning is really not a given. Your examples are those of comparing apples and oranges. You cannot fairly compare cost of renting vs owning unless you're using similar living conditions. All else equal, owning will usually be less than renting, simply because the rent usually covers the landlord's cost of owning plus profit. There will always be exceptions due to extenuating circumstances. Maybe you overpaid in a hot market. Maybe you bought a money pit. Maybe the local economy collapsed.
there is a cost to that money being tied up in the house eventually .
we can buy a co-op for 6k less than our rent . but once i figure in the fact we will be giving up 12k in income on the money we will spend to buy that co-op , renting is still 6k cheaper .
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
