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Renting vs. Buying
  • Is renting cheaper? No. Given the same house it will almost always be cheaper to own than to rent. Here is why: Somebody owns that house. And there is probably a mortgage on it. Let's say the mortgage payment is $500. If I owned it and rented it to you I would not charge your $500. I would charge you $650 or $700 because I would own it to make a profit. Not to mention the fact that a home owner is always getting equity while a renter is not. On the flipside as a renter you do not have to worry about repair, taxes, insurance, etc.
  • Don't forget the tax advantages to owning the home! Depending upon where you live, there may be programs to encourage home ownership or to assist low-income and first-time buyers. In our town we have an infomercial on TV every Wednesday night in which two realtors review "available properties for no money down and monthly payments less than you'd pay for rent!" I recommend a book called "Live Debt Free," about buying a small property when you're young, making double payments so you own it outright in 15 years, then selling it for an appreciated amount which you use as a down payment to buy the home of your dreams in your middle age. That comparatively large down payment means you'll have lower monthly payments, which might mean one spouse can stay home with the kids or more income would be available for travel or high living. It's the kind of book you have to give as a graduation present, 'cause by the time you're my age it's too late!
  • Keep in mind that there are one-time costs associated with the purchase of a house, like closing costs and realtor fees. If you only plan to live in a place for a year or two, this averages out to a lot of money per month, and usually makes it cheaper to rent.
  • Use the Ginniemae.gov calculator to compare the advantages and considerations of owning vs. renting a home.

I think this partially answers the question. The assumed rate of appreciation does change the return and decision process. If, for example, the real estate market is running at a 2 to 3% decline each year...renting makes sense. If you had appreciation...of 3%..then yes, it would usually make sense to buy. Interest rate, condition of the home you want to buy, your plans and time frame all make a difference. For instance...what if you only wanted to live in a home for 2 years? Closing costs to purchase and then later sell make the decision to rent more realistic.

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Renting home is better in some cases..

If your rent is very low.

If you plan to moving in a few years or months.

I personally prefer to rent an apartment. I have been renting a 2 bedroom for $800 a month while continuing my real estate enterprise so far for the past 4 years -- any defects are paid for and fixed by the propery owner and I can continue my enterprise and not keep any properties under my wings for extended periods of time this enables me to be able to leave the country for travel fun without worrying too much about vandals, home insurance, property taxes, repairs, etc... as I build my fortune for the next 15 years at which time I will then use some of the savings to begin winging some of the properties for my own personal retirement portfolio-- in the meantime... the IRA account looks wonderful. I urge anyone to teach their 20 year old son or daughter how to do foreclosures the same way I do them and to save what they can and prepare themselves for an early retirement by age 40

Renting a home will give you more chance to save it is best to rent if you still don't have budget to buy your dream house. If you know how to handle properly your money surely that you can save a lot from your money while you are renting.

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Wiki User

8y ago
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14y ago

Invariably, home owning is more efficient with cash.

However renting does have its perks:

- Far less commitment in rental period compared to owning
- Maintenance done by the landlord
- Far cheaper in deposits


But then there are cons:

- Essentially dead money, you have no equity at the end of your rental period, unlike ownership where your money has paid off some of the value of the property
- You miss out on long term inflation and house price raises
- With renting, neighbours tend to be worser than purchasing



I would advise renting, till you know what you want, then buy a property with a large deposit saved when the market is low, for example in the past couple of years.

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12y ago

It depends on the details. This is really a question that cannot be absolutely answered; you'll have to look at your circumstances and decide which is best for you at this time (the answer can change).

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Wiki User

12y ago

Advantages of renting a home:

- Possible free utilities

- Possible free water and electricity

- Cheaper then buying a house

Disadvantages of renting a home:

- Possible unneeded costs and maintence,

- Damaged house

- Bills that should not be paid when owning a home.

Advantages of buying a home:

- Your own space to relax

- Supporting a family

- Having a secure base to call home

Disadvantages of buying a home:

- Depending on how much money you have, you can rack anything from $10k to $400k dollars in debt

- Costs of maintenance of a house

- Bills and Repairs

- Self-maintenance

- Cleaning your house

Anyway you look at it, renting a home or buying a home has it's pro's and con's

The best way to determine which is better is to do your reasearch, go with trusted landowners if you are renting, buy a home within your own financial limitations.

Kind Regards,

Anonymous Caretaker

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Eazy Homes

Lvl 2
2y ago

Those people who want some flexibility and less responsibility. A renting a home can help people who are working or studying. There are many advantages instants of buying homes. Eazy Homes provide best relocation services in Berlin. If you are looking reliable services, then get in touch with us.

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17y ago

It is better to rent a home because you might not like it after a while and you might want to move out.

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Wiki User

13y ago

This mostly depends on you, your credentials, and the price of the place that you want to rent.

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Wiki User

15y ago

Buy a house because house-selling is very low around this time and when your lease is up and you cannot find a house, what do you do?

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15y ago

own because then you can do what you like and not get evicted plus if you plan on having children they can live there when your dead

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Wiki User

10y ago

if you want to benefit from increase in property value

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Q: Is renting a home less costly than buying a home?
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Can you be evicted if your landlord is in foreclosure?

A landlord that has a choice of renting to a person who has a repo and a person who doesnt will likely choose the NON repoed person. Why?? They manage to PAY their bills SOMEHOW. YES, it LOWERS your credit score making it harder to get credit. Rent is a form of credit.


Homes For Rent: A Great Alternative to Apartments?

If you are a person who either prefers to or needs to rent, and you have been renting apartments up until now, you might want to consider renting a house. If you have a family, especially, the difference between apartment and house renting can mean a lot for all of you. Homes for rent are available in nearly every town of every state, and sometimes they will not be advertised, especially if you happen to live near small towns. Apartments can be less inexpensive, as far as renting goes, but often it can cost you less to rent a house. Sometimes it’s good to compare what’s out there, with what you are renting now, to get a better idea about rental costs. If you are living in an apartment, you know that there are certain rules and regulations that you need to abide by, in order to live there. Homes for rent don’t normally have such restrictions, although homeowners will want you to be agreeable to a contract’s requirements, which can include maintaining proper noise levels and keeping the yard and home clutter-free. The other plus of renting a home, instead of an apartment is space. In fact, if you think of the space you can rent in a house, compared to that of an apartment, you can see why some homes definitely cost more to rent than apartments do. By contrast, the small space within an apartment home can be very restricting, to the point where often you feel you would like more space; here is where the beauty of a rental house really shines. Having plenty of space for you and your family to live in, can indeed be gained by renting a house instead of an apartment. Sure, they might sometimes cost a bit more, but the satisfaction you will gain from living somewhere that you feel you can breathe, move about, and not worry about noise and other hassles from having to live next door, underneath or above other people or families, can certainly be worth your money. Think on what you can afford, prior to selecting the cost range for a house, when actively looking.


In order to buy a house does one have to rent first and save up money?

Most lenders require a down payment when buying a home. The amount varies from lender to lender but the average is around 20% of the purchase price. If you put less down they will require you to pay for private mortgage insurance.


How much can you make renting out a house?

Depending on the size if the house and how many bedrooms will usually determine how much money you can make from renting it. If you rent it to one person you will probably make less money than if you rent it in a room by room basis to individuals, as you can charge them individually. All rental arrangements will ensure you cover the cost of the mortgage on the property, however you should always get rental cover so that if your tenants can't pay their rent, you will not be left short trying to pay the mortgage.


Affordable renting in Raleigh, North Carolina?

With the many universities and learning facilities in and around the Raleigh, North Carolina area, there is an endless supply of rental property available. For most college students, the freedom of renting a place of their own is encouragement enough to seek out renting in Raleigh, North Carolina. But can a college student afford it? Quite simply, the answer is yes. There are many affordable renting options in the Raleigh, North Carolina area. Whether you are looking to get a small apartment of your own, or are interested in finding a larger rental home that can be shared by several roommates, you should have no problem finding the perfect place. In most circumstances, renting a home or apartment off campus can be less expensive than living in a dorm on campus. Plus, you will have the freedom to come and go as you please, without being under the watchful eye of other students or resident advisor. To find affordable renting in Raleigh, North Carolina, you have several options available to you. Look for publications around town that specialize in advertising rental property in Raleigh, North Carolina. These publications are updated frequently and are very helpful in finding what is available in your price range. Check online for apartments and rental homes that are being rented out by owners. Browse through the Raleigh newspaper, in the classified section, to see which rentals are newly listed. And finally, look over the bulletin boards at your local grocery store, restaurant, and other public meeting areas. Many landlords post rental openings in such places. To save money, look for affordable rental property in Raleigh, North Carolina that is several minutes away from any of the local universities. Rentals within a 5 - 10 mile radius of these learning facilities are typically priced slightly higher, and you can money by looking a little further away. You can also save money by having at least one roommate share an apartment or home with you. With a roommate, you can split the household duties in half too, or even carpool back and forth to school.

Related questions

What are the benefits to renting an apartment versus buying a home?

Renting an apartment is often a good choice. People who live in urban areas prefer apartments simply because they are much easier to come by. Utilities in apartments are often much less than buying a home. Apartments are often advantageous for people who do not plan on staying in one area for awhile. Buying a house is a commitment, and in a bad real estate market you might be stuck in a house.


Buying a house or renting a house?

If you can buy, definitely do that. That way instead of paying rent, you're paying off your mortgage. It depends on the relative cost of buying versus renting in your area. In many places it costs less on a monthly basis to buy a home than to rent one, but in some locales rent is very cheap compared to buying a house. In those places you might be better off renting and saving the additional money that would have gone towards the costs of buying. That money saved could be used to buy a better home at some point, perhaps in a cheaper city.


How costly is it to hire a plumber for my home?

The cost to hire a plumber to fix a leak in your home will vary by location. Typically, a plumber is very costly to hire. A handyman will be less expensive and will do a comparable job.


The home buying center?

The Home Buying Center is a house buying company there website is http://www.thehomebuyingcenter.com They also sell foreclosure houses cheap. My friend Bob used The Home Buying Center and bought a house way less than through a real estate agent.


Are rent leases cheaper than buying outright?

Renting is often less expensive than buying when a short-term stay is necessary. Over the long term, the equity in your home associated with paying off a mortgage can offset the short-term losses. However, investing the difference between a mortgage and rent costs can be more lucrative in certain localities.


Consumers' willingness to replace a costly item with a less costly item is an example of what?

Subtitutes


What is cheaper renting or buy and what do you do with them after that?

I have no idea what you are referring to in this question- what do you want to rent or buy? In general, renting will always be less expensive, if available.


Bucket Trucks: New, Used, or Rental – What Is Best?

Buying a bucket truck can be expensive and a major investment for any business. In these uncertain economic times, good business can turn bad at the drop of a hat. Extra expenditures need to be fully examined to see if they are necessary or if there are other options. When looking at a new bucket truck for a business, a responsible business owner needs to look at whether buying new, buying used, or renting is the most cost effective choice for their business. If a business needs a new bucket truck, there sometimes can be no substitute to buying new. But need can be difficult to determine. Buying new carries both warranties and peace of mind. The warranties are helpful if something goes wrong, but may not be necessary on a good piece of equipment. The peace of mind that comes with not buying someone else’s problem is often mitigated by the much larger monthly bills, in some cases double the size. Buying a used bucket truck is a far more cost effective choice than buying new simply because the business owner pays less. Good quality used bucket trucks are available that are less than 10 years old and up to half the price, or sometimes less, than the price of a new truck. Buyers need to beware, however. Having the vehicle checked out by a qualified and trusted mechanic is crucial. Also, going with a difficult to define gut feeling could be helpful. Ignoring that little voice in the back of one’s mind could be costly. Renting or leasing is yet another interesting option. If a business has a temporary surge or a short-term job that requires an additional bucket truck, renting one may be an excellent choice. It can get expensive, but so can buying a large piece of equipment and then having it sit around unused. Renting allows the prospective buyer a chance to try out a different model than they are used to. When it comes to bucket trucks, buying new, buying used or renting are all possible options. Business owners need to take a good look at what they really need before jumping in with both feet.


Should you report income from renting a room in your residence?

Yes rental income and expenses would be reported on the schedule E of the 1040 tax form.There are special rules relating to the rental of real property that you also use as your main home or your vacation home. For information on income from these rentals, or from renting at an amount less than the fair market value, refer to Topic 415, Renting Residential and Vacation Property (formerly Renting Vacation Property and Renting to Relatives).Go to the IRS gov web site and use the search box for TOPIC 415Click on the below Related Link


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