Buying a home is one of the greatest American dreams. Why going into 100’s of thousands of dollars into debt is everyone’s lifelong dream, I’ll never know … Just kidding, I do know. I was a part of that dream, obsessing over having my own home. I even told my husband that we weren’t going to have kids until we were in our own house. There was no reason why I thought renting vs buying your home would be the better option.
We were that couple that drove around on Sunday’s looking at neighborhoods. We even found our perfect neighborhood. On top of that, we saved up 20% of where we wanted our price range to be. Look at us being the go-getters! Nothing could prepare us for the nightmare that began.
We had some pretty low expectations when we first started looking for a house, we knew what we wanted and didn’t expect to find anything right away. I think our expectations were still a little too high because we were completely crushed when we found out the hefty prices of a STARTER home. Living in the fastest growing state with a shortage of homes definitely has its downfalls! Yeah, we may have some awesome job security but we’re also going to be paying rent the rest of our life.
Just kidding — about the job security, you should NEVER think that your job is completely secure. Always prepare for the unexpected. (i.e. emergency fund.)
After quickly re-evaluating our situation and realizing that it won’t be the worst thing in the world if we rent for a few more years we decided to look for a bigger space. Remember how I mentioned the major housing shortage? That’s not just for buying, to say we had an absolute terrible time trying to find a place to even rent would be an understatement. If you did manage to find a decent place to rent you had to put an offer in that day before you could even go look at it without it being snatched up.
Luckily, our nightmare didn’t last too long (it was still way too long in my eyes though) and we finally found an amazing place we could call ours. Except we can’t, because we’re still renting. So it’s technically not ours no matter how much I’d love to pretend.
Even though renting isn’t exactly an ideal situation to most, it works for us at the moment and it can actually be a GOOD thing in many situations. I’m here to help you figure out what’s best for you. Is renting a home the perfect option?
BENEFITS OF RENTING vs BUYING
Everyone loves to talk about the downsides to renting. Trust me, we got the whole “You’re just throwing money away,” speech already. At least I’m not throwing my money away on an insane amount of interest right now either (which would more than likely happen when putting less than 20% down.)
There are a few upsides to renting your home, like the fact that most places come with appliances. Do you know how expensive those things are?! And there’s so many options, how do you seriously choose just one fridge when you want like 5?? Until you see the price, then you don’t even want a half of one.
In our first apartment all appliances were included, my big thing was a washer and dryer. I HAD to have one wherever we lived – when we got married there was no way we could even afford to buy a used one. Our second place had all appliances except a washer and dryer. Luckily this time we were a little more prepared and invested in one that definitely didn’t break the bank, but we could use for the next 10 years.
If you’re not ready to make those mighty – yet necessary – purchases in a home then you may want to find a place that has them included. Even renting for a couple of years while saving up for appliances can benefit you more than going into MORE debt on a fancy fridge.
No taxes and no utilities
Taxes are something that people definitely forget to consider. Surprise, surprise you get taxed more when buying a home! It’s not something you want to ignore when looking for a home, you’ve got to consider the property tax you’ll have to pay. Can you see the money adding up already? I think I’ve almost convinced myself to forever rent … Just kidding, my husband wouldn’t go for it.
Not only do you have to pay taxes, but you take care of all utilities. Something that most renters don’t have to pay for. Yes, we do pay for some utilities such as gas, electric and internet. (We don’t have cable and end up saving about $1,000 a year by watching all our shows here instead.) Not having to worry about trash, water and sewer is helping us put a little extra cash in our pockets. If you’re lucky, some places you move to will cover ALL your utilities. Wouldn’t that be a dream?!
If something goes wrong, it’s not coming out of your pocket
The absolute best reason to rent! This is what (almost) makes it worth
throwing our money away renting. In our first apartment there was sewer and mold problems. Yikes! Who wants to deal with that crap?? (literally).
The place we’re in now is only a year old but they did have a roof leak right before we moved in. Having the assurance that if it starts leaking again we don’t have to fix it, is really magical. I won’t even be mad if it started leaking again because it’s not my problem! We pretty much get the joys of living without the cost of home maintenance.
Don’t have an emergency fund started yet? That should be your top priority – buying a home is definitely not something you want to chance without having an emergency fund. I know you think “That’ll never happen to me”. That’s what everyone else thought too, until it actually happened to them. Trust me, things will go wrong whether you’re prepared or not. I don’t know about you but I’d rather be prepared – rent for a year to save up your emergency fund so you have no worries!
No worrying about resale value
On average, people only stay in homes for 5 years now. Buying a new home, you have to start thinking immediately about resale. Whether you’re planning on doing a fixer upper or you think it’s your forever home. (Don’t kid yourself, you’ll always want something better and new.) Luckily, in a rental you don’t have to worry about any of that. You can live there as long, or as short, as you want and when it comes time to move – you move. Just like that. No stressing, not even a thought of what the resale value would even be.
If you’re not planning on living where you’re at for at least 5 years or more, chances are it’s not that good of an investment and you won’t be making your money back. When buying a home, for the first 7 years you’re basically just paying interest. It takes time for you to start making a dent in the principal of the loan. Weigh your options – will you lose out on money by being in a home for only a couple of years or would you save more by renting?
Becoming more Prepared when Renting vs Buying your home
I want to be clear that I’m not saying buying a home is a bad option. Buying a home is an awesome investment, and a major part of achieving the American Dream. But, you still need to be smart about it. Even though you may qualify for a home it doesn’t mean you’re in the best financial position to afford it. It’s okay to wait until you’re ready to buy a home, no one ever regrets being prepared. And don’t listen to all those people who say you’re wasting money by renting – at least you have an emergency fund and probably more money to your name then they’ll ever have!
Let me know below what you think of renting and if it’s an option for you!
P.S. Know someone who’s thinking about renting or buying a home in the future? Share with friends or family below to help make their decision easier!