To rent or to buy, that is the question. We all need to have a roof over our heads and a safe space to call home, but home can mean many different things – it can be a townhome, a condominium, an apartment or a single-family residence. All of these different types of properties can be rented or owned and there are various pros and cons to consider for both options. There’s no clear answer to whether renting or owning a property is a better option, and that’s because the best choice is the one that fits your current needs and lifestyle best. For example, a young college student with a busy schedule of schoolwork, extracurricular activities and a part-time job doesn’t have the time or mindshare to worry about being a homeowner, which means that renting an apartment alone or a house with roommates is a better option. On the other hand, a family of four with solid and reliable income might choose to buy and own a home instead of renting. While there are various pros and cons of renting and owning it ultimately comes down to your personal needs, your goals and your financial situation.
In this post we’re going to explore and take a deep dive into the pros and cons of renting – our goal is to provide current and relevant information and education so that you can make an informed decision for your unique situation. If you need additional guidance and support or you have questions about renting or buying a home in College Station, we strongly encourage you to contact us so we can discuss your needs and help you.
The Pros of Renting
The “American Dream” dictates that homeownership is the ultimate goal – and while being a homeowner is something that most people strive for, it may not be the best option for everyone. If you are someone who enjoys traveling a lot, moves around for work or you simply can’t stay in one place for too long then owning a property is not right for you. In general, renting is ideal for people who are in need of a short-term home. If you are planning on staying in one place for less than five years, then renting is the way to go. Check out some of the top benefits and pros of renting versus owning a home.
- Flexibility & Freedom
When you are renting a home, apartment or condo then you can easily pick up and move whenever you want to. Even though you will have a lease in place, if you want to break it early there are ways to lessen the penalties and work your way out of it if you wanted to. Breaking a lease early is significantly easier than going through the process of selling your home. Most lease agreements are put in place for 12 months and after that you could negotiate to sign a six-month lease, or even go month-to-month – this is something you will have to work out with your landlord or the property management company the landlord works with.
- Low Maintenance & Little Responsibility
When you rent a property, you are responsible for keeping it clean and damage-free, which would be the same as owning your own home. The difference is that if something major breaks and needs to be fixed – like the roof, HVAC system, plumbing issues, etc. – these are the responsibility of the landlord or property management company. As a renter all you have to do if you are experiencing issues with your property, no matter what the problem is, is to contact your landlord and ask them to fix it.
- The Ability to Save Money
One of the major pros of renting versus buying is that you know exactly how much you will need to pay every month. You are not responsible for maintenance costs like a gardener or pool cleaning service, no additional taxes or fees, certain utilities may be included in your rent and there are no surprise costs. Additionally, rent is significantly lower than a mortgage and you are not responsible for homeowner’s insurance or property taxes. All of this means that you can budget and save your money so that when you are ready to buy a home you will be mentally and financially prepared.
The Cons of Renting
As you can see, renting provides a lot of freedom – freedom to move and the opportunity to save your money. While this set up might be ideal for many people, it’s also not the best option for everyone. Let’s take a look at what some of the downsides to renting are.
- You Don’t Build Equity
When you buy a property you immediately begin building equity and your money is being invested in a way that will hopefully bring you a decent return in the future if you choose to sell it. And if you don’t ever sell then you will have the benefit of owning a home and not carry any debt, or if you find yourself in need of a loan you can borrow from your home. The monthly payments you make towards your home are not an expense, but rather you are paying down the debt you owe on your loan.
- No Customization & Personalization
Most landlords will not give you the option to paint the walls, change the flooring or otherwise alter the rental property in any way apart from hanging pictures and art on the walls. The only way you might be able to personalize a rental is if you ask for permission from the landlord and agree to restore it back to what it looked like before you made any changes before you move out. When you own a property, you have the freedom to design it as you wish and also alter the design, color and lay out as often as you want to. Although renovations can get expensive, if you do it right then you will be adding value to and investing in your home.
- No Tax Benefits
As a homeowner you get to take advantage of certain tax deductions that can give you a decent break and even a return. As a renter you don’t have the opportunity to claim these deductions.
- Bad Landlords
The good thing about renting a property is that you can turn over any major issues and complaints to the landlord and they will have to fix it or deal with it one way or another. On the other hand, the world is full of bad landlords and your health, safety and happiness as a tenant can be very dependent on this individual. Some landlords may not respond to your concerns or take too long to fix issues or manage repairs. If you feel that your landlord is taking advantage or not meeting expectations make sure to look into what your rights are as a renter and tenant.
- Various Restrictions
When you live in a rental – whether it’s a house or an apartment – you have the follow the rules of the landlord or those set forth by building management. These may include noise restrictions, a limit on guests, no pets or other rules that you have to agree to.
- Payments Never End
We mentioned that as a renter you don’t build any equity, but the other thing you have to remember is that your rent payments will never stop. Even though 30 years is a very long time to pay off a mortgage, if you stay consistent you will eventually pay off your home and no longer have to make those payments. As a renter you won’t get relief from monthly payments – even when you retire you will have to keep paying your landlord for as long as you occupy the space. Additionally, your rent can and most likely will rise year after year.
There are various pros and cons to being a homeowner as well, but whether you choose to rent or buy a property simply depends on your unique financial situation and your lifestyle. We encourage you to take a look at the current available rental properties on our website or if you can’t find something that catches your eye then please contact us so we can help you find the perfect rental to fit your needs. Our team has more than 25 years of experience in the real estate industry and we’ve assisted clients ranging from first time home buyers, veteran sellers as well as experienced investors. If owning a home is not something that is right for you, but you’re interested in learning how to invest in real estate we can help you out and get you set up for success as an investor. We look forward to hearing from you, answering your questions and earning your business.