Paper Dude Date
Once upon a time, the average person dreamed of getting a good job, buying a house, and, possibly, raising a family in said house. Economic climates, however, have altered this dream. Some might say this has changed for the worse, while others might say for the better. Nonetheless, the biggest component of this dream that has changed has been property ownership. While plenty of people still want to own a home, but there is an increasing segment of the population opting to rent rather than own. Considering this slowly shifting preference, it is important to consider the financial pros and cons of renting a home.
One of the first pros that come to mind when thinking of renting a home is the lack of responsibility. Whether a house is brand new or Victorian, a lot of responsibility comes with it. What makes this responsibility even more complex is that while some of it can be planned for, at other times it can be sudden and very expensive. A great and obvious example of this would be maintenance. Be it the plumbing, furnace, or something electrical, one of the financial pros to renting a home is these simply are not your responsibility. When these issues arise for a renter, they have the luxury of grabbing their phone and calling the landlord to have it taken care of rather than grabbing their phone then their wallets to pay for it themselves. Much the same can be said about homeowner’s insurance or even storm damage. While both may have some effect on the resident’s quality of life, in some ways, neither are a renter’s responsibility, therefore being a financial pro.
Not having to deal with property taxes is another financial pro to renting a home rather than owning. Depending on where a house is located, sometimes property taxes can be more of a burden than the home’s mortgage in itself. Furthermore, property taxes can change throughout the years as the value of either the property or the desirability of the neighborhood change. Renters simply do to not have to worry about taxes and the consequences of not paying them because they are the sole responsibility of the owner. Property taxes can be an increased burden should they be high and coincide with a high-priced mortgage. It gets even worse if the property around the home has large trees, meaning the homeowner’s insurance would be rather steep.
The first and most obvious financial con to renting a home rather than owning is the fact that the renter is investing hard-earned money into something he or she will never actually own themselves. It is a well-proven fact that many, if not most, tenants pay rent that is well over the cost of the property’s mortgage. This causes what can only be described as a financial con because the renter lives and invests in a residence but will never have the property to “show” at the end of the living there and paying for months or even years like the owner will. Essentially, a major financial con to renting a home is not getting a real return on the money you have invested.
Another financial con, one that people often do not consider, is being at the mercy of the owner’s actions or inaction. As stated, this is not always obvious, but often tenants can find themselves in financial binds should the home’s owner not live up to his or her responsibilities. For examples, if a landlord does not fix certain things, a tenant may suddenly have to move. This could occur at a bad time, financially, therefore creating an unexpected, but very real, financial con to renting a home. Renters have absolutely no control over the home’s condition, therefore little control over their quality of life in it should they face the financial con of having to move.
As economic situations have changed across the globe, the dream of owning a home has changed as well. More and more people, particularly of the younger generations, are opting to rent home rather than own. The before-mentioned financial pros and cons of renting a home are only the tip of the iceberg. Financial pros and cons of renting need to be carefully considered and planned for before declining to purchase or becoming complacent with renting and investing in a home you will never own.
