Raise your hand if you’ve ever heard one of these lines: shutterstock_158308928

  • Renting is like throwing your money down the drain.

  • Homeownership is a never-ending time and money suck.

  • You’re young! Why tie yourself down with a house?

  • You’re old enough — shouldn’t you own a home by now?

If you’re stuck in the Rent vs. Buy debate, chances are you’ve heard one of these quips. Everyone from friends to family to workplace colleagues offers their own reasons to support you renting or buying — and it’s only making you more confused.

How do you make sense of all the conflicting advice and decide what’s right for you?

The easiest approach is to break down the debate into some simple lifestyle considerations. To begin, we’ll assume that you’re in a financial position to either rent or buy a home; your choice comes down to which route will make you the happiest and give you the lifestyle you want.

Renting

Let’s start with some advantages to renting.

Flexibility. If your circumstances or preferences change, renting can give you the flexibility of moving quickly — you can easily move to a different city when your lease is up. If you’re sick of living downtown, you can head out to the suburbs.

If you lose your job, realize you hate your neighborhood, or decide to move in with your significant other, you can move as soon as your lease expires (or plunk down whatever cash is necessary for an early lease termination). If you own a home, by contrast, you’ll have to undergo extensive additional expenses, hassle, and stress to sell your home before you can move to your next spot.

Access to amenities. Depending on your building, you may be able to access top-quality amenities at a fraction of the cost of installing or subscribing to them yourself. From that oh-so-convenient dishwasher to the on-site gym and swimming pool facility, your monthly rent covers some nice perks you’d otherwise have to pay for out-of-pocket.

Less responsibility. As a renter, you can avoid the maintenance and repair hassles that come with owning your own home. Your leaky faucet is fixed for you, someone else handles that late-night furnace breakdown, and you don’t need to worry about mowing a lawn in the summer or clearing snow in the winter.

Less financial pressure. Owning a home is a long-term financial responsibility. If you’re a renter, and you’re hit with a financial hardship, you can move into a less-expensive rental. As a homeowner, you’re stuck with your mortgage. If the idea of paying a mortgage for 15 to 30 years makes you hyperventilate, you’re probably not ready for homeownership.

Less costly surprises. As a homeowner, you face a lot of potentially expensive surprises, like a roof that suddenly starts leaking or a sump pump that fails and floods your basement. As a renter, your biggest potential surprise is a rent hike when your lease is up for renewal — and if you don’t like the proposed rental increase, you can negotiate or move.

Owning

That said, owning a home offers some incredible advantages.

Ability to customize. Hate the chintzy cabinets in your kitchen? Dying to turn that laminate countertop into a beautiful piece of granite? As a renter, you can’t customize your surroundings. As a homeowner, your home is your canvass. Paint the walls, knock down a wall, create your dream kitchen — no one will tell you what you can or cannot do to your home.

Freedom to live how you want. Want a dog, a cat, and a litter of gerbils? Go for it. Want to host a cookout on your deck? Feel free. As a renter, you’re subject to your landlord’s rules about pets, outdoor spaces, and other lifestyle choices. As an owner, you can do almost anything, as long as it’s legal and you don’t disturb the neighbors.

Financial perks. Owning a home can help you build equity. You can also write off mortgage interest at tax-time, get tax credits for certain improvements (like energy-efficient windows), and even turn your unused rooms into rental units for extra income.

Fixed monthly payments. As long as you’re on a fixed-rate mortgage, your mortgage payments will never rise. In fact, as inflation kicks in, you’ll repay your mortgage in cheaper dollars over time. As a renter, unless you live in a rent-controlled area, your landlord has the ability to increase your rent any time your lease is up for renewal.

What Questions Should You Ask?

In addition to the lifestyle factors listed above, take the time to thoughtfully answer these questions:

  • Where do you see yourself in 3-5 years?

  • How long will do you plan on living in the same town?

  • How stable is your job?

  • Can you afford a home you can “grow into” in the next decade?

  • Are you prepared to sink a large amount of money into purchasing and maintaining a home, or do you have other financial goals you’d rather focus on?

  • Are you a hands-on or a hands-off kind of person?

There’s no “right” answer to whether you should rent or buy. Your desired flexibility, stability, lifestyle, responsibility readiness and other personal factors will paint a picture of which is the best choice for you.  And we are happy to help you!