I think that overall renting has got to be simpler, and may well be cheaper in the long term. My friends who own houses are forever having some unexpected expense drop from the sky--new septic system, new roof, new furnace.... My sister, who is disabled and lives on a fixed income, is constantly fretting about these kinds of costs. Just last week she had to shell out several hundred bucks for a new garage door opener when the old one broke and she couldn't get her car out of the garage.
The standard argument is favor of buying is that you are "building equity" instead of shelling out money for rent. As millions of homeowners have recently learned, that's not such a certainty. There's also the argument that you get to deduct interest payments from your taxes. The problem with that line of reasoning is that you're paying many thousands of dollars (hundreds of thousands, in most cases) over the life of your mortgage to get a tax "savings."
In 2000 I moved to the costliest housing market in the country. At times during the past dozen years I considered the possibility of buying a small condo, which was all I could afford. Had I bought before the housing bubble burst, I would have taken a bath when the market collapsed. I would also have paid a ton of interest on the mortgage by now. Instead, I found the cheapest apartment I could (not cheap in absolute terms, but by the standards of the area). If someone were to tell me I'm throwing away money on rent, I'd point out a couple of things. If I owned this apartment, in addition to a mortgage payment, I'd be paying about $200 in local property taxes and almost another $300 in common charges--nearly half my present rent. And I'd be responsible for fixing anything that broke, painting the place, cleaning the carpet, and so on--all things my landlord does now. I write one check at the beginning of the month, and that's the end of my headaches.
All that said, I don't discount the possibility of buying a home one day. I like the idea of living in a very small house, and it would be nice to have a small yard. Almost no such houses exist around here, so I don't think I'll be buying unless I move out of the area.
I rent my apartment in a beautiful area. I like renting far better than owning a home, since I don't have to worry about paying property taxes. Our rentals here are only allowed to be raised once per year at 4.5 percent. If something breaks I have to call the manager and he will fix it.
My apartment is large, has two skylights, a huge bedroom and a smaller bedroom which I use as a den. I have my computer and a single bed for guests there.
I have a very large deck with two sliding glass doors, one in my bedroom and one in the livingroom. I have a private parking spot, included in the rent. The kitchen is small but it has a fridge, stove and dishwasher all recently replaced, plus my microwave oven. The bathroom is small but has a huge mirrored wall, two drawers and plenty of cupboards. It had plumbing to put my washer and dryer in, which I can take with me if I move into another apartment, but I don't plan on any moves and have told my son that he can have them when I die.
The block next to mine has a bank, a clothing store, 4 hairdressers, a great pizza shop, barbershop, a large grocery store, two stores which sell both new and used clothing, which is where I buy clothes if I need some. I have more than enough closets that I need to go through and give them to a charity to sell.
I'm a homeowner and a landlord. All things considered, I'd rather own.
As a renter, you still have to pay for utilities consumed. You also have to pay for the mortgage and the taxes on the property. What many people may not know is that, at least in my area, the property tax rate and the mortgage rate are higher than those for an owner-occupied dwelling because the place being rented is considered "investment property". There also are licenses and city inspections I have to pay for for my rented property that I do not have to pay for my own home. And rental properties need new roofs and water heaters and painting. You're paying for those, too, though people who rent in larger dwellings (like apartment buildings) enjoy a bit of an "insurance effect" in that it's unlikely everyone will need a repair in the same month.
As a homeowner, I can decorate and remodel the way I want. Not everything has to be "apartment white" or "neutral". I can garden outside, have a pet, not have a pet, and I have complete control over how a repair or improvement is done. Even on a city lot, I have some space and privacy (and no more bowling-ball-juggling upstairs neighbors). It doesn't cost me $3-4 every time I wash and dry a load of laundry (not counting driving to the laundromat when I had to do that).
To each their own, certainly. It is simpler to write one check a month to the landlord and to have one phone number to call when something breaks. But ownership has its advantages, too. I'm writing this mostly to point out that the economic argument for renting may not be as strong as it seems over the longer term.
I use a Macintosh and mouse left-handed. I drive a diesel car. I listen to records on a turntable. I've never seen "Titanic". I don't do ANYthing just because everyone else does.
Something about the rent vs. own argument that needs to be considered. Some of us don't have incomes that would *ever* allow us to buy, at least not something decent in a relatively safe area. My area is so expensive, even now, and the property taxes are ridiculous. There's no way I would ever be able to buy, at least not on my own (aka without a hubby).
I'm fortunate that my rent hasn't gone up in four years.
I'm with Tradd on that.
The average Kiwi family earns around $40k per year. To live somewhere in the city that is a decent and safe neighborhood, the least expensive houses that would be simple and decent (talking 800 sq ft or less, 2 br places with modest 'fixes' that need to be done) would cost between $450-550k to purchase.
Here, the really only allow 15 year mortgages, and it's only fixed for the first 5 years, and after that you negotiate for the rate and the cap. You have to have 25% down just to get a mortgage, which means that the average person would have to save $112,500 just to be able to buy a place.
As "Don't tell me what to do!" will be my epitaph, and because I fiercely guard my privacy, renting doesn't hold much appeal for me, but I can see the practicality of it. It does seem simpler, in many ways, than buying.
I understand completely - limitations on such otherwise practical and simple things is very frustrating!
My own predicament is more just because we live in a 100-year-old apartment. I'm dyyyiiiing for a little garden or even a balcony where I could grow veggies!