Particular owning a home may be a lifelong goal for many Americans, but that doesn’t mean it’s for everyone. Homeownership rates are currently high in the U.S., but this is not always the case. Most families have historically needed to either build their own homes or
Below, we’ve listed eight main advantages of renting instead of buying a home.
1) No Maintenance Costs or Repair Bills
One of the advantages of renting a home is that there are no maintenance costs or repair bills. It means that whenever you rent a property, your landlord assumes full responsibility for all maintenance, improvement, and repairs. If a tool stops working or your roof starts to leak, you call the property owner, who is required to fix or replace it.
On the other hand, Homeowners are answerable for all home repair, maintenance, and renovation costs.
2) Access to Amenities
Another financial advantage of renting is having access to amenities that would be a vast expense. Luxuries like an in-ground pool or a fitness center come standard at many midscale to upscale apartment complexes with no extra charges to tenants.
In case a homeowner wants access to these amenities. Then they would likely have to spend thousands of dollars for installation and maintenance.
3) No Real Estate Taxes
One of the considerable benefits of renting versus owning is that renters don’t have to pay property taxes. Real estate taxes may be a heavy burden for homeowners. In some areas, the value associated with ownership taxes can amount to thousands of dollars each year.
Even if property tax calculations can be complex, they are determined based on the estimated property value of the house and the amount of land on which it is constructed.
4) No down Payment
The area where renters have a better financial deal is the up-front cost. Renters usually have to pay a security deposit equal to one month’s rent. This deposit is respectfully returned to them when they move out, provided they haven’t damaged the rental property.
While purchasing a home with a mortgage, you must have a sizable down payment—typically around 25% of the property’s value.
Of course, that down payment results in having equity in the home, which only increases as the mortgage are gradually paid off. And once you own a home free and clear, you have a valuable investment that renters never gain.
5) More Flexibility for Where to Live
Renters can live anywhere, while homeowners are bound to those areas where they can afford to buy. Living in a costly city like New York may be out of reach for most home buyers, but it is possible for renters. Even if rents can be high in areas with high home values, renters are more apt to find an affordable monthly payment than home buyers.
6) Few Concerns about Decreasing Property Value
Property values go up and down. While this may broadly affect homeowners, it affects renters substantially less. Your home cost can impact the amount of property taxes you pay and the amount of your mortgage.
7) Fixed Rent Amount
The amount you pay for rent is settled for the span of the lease agreement. While landlords can raise the rent with notice, you can budget more efficiently because you know the grant of rent you are required to pay.
The same applies to homeowners with fixed-rate mortgages, which are also granted for efficient budgeting.
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