Renting vs. Buying: The Pros, Cons, and Costs

Mr. Smith and I lived together in an apartment before we bought a house together.  Our first home is now a rental property.  We’ve gone through a few changes in our housing situation over the years, and will probably need to move again someday in order to accommodate our growing family.  For a long time, home ownership was held up as a milestone on your path to financial independence.  It was expected of most adults to eventually get their own place. However, like the standard path to traditional “success,” the answer isn’t that simple now.  Plenty of people happily live in rented accommodations that fit their housing and financial needs.


Buying Pros

The most obvious benefit of buying a house is owning it.  It is an asset with value, that can play a big role in securing yourself financially years down the line.  Buying a home is becoming more flexible than you might imagine, too.  People assume that they’ll be making the same mortgage payments for fifteen or thirty years, but options like refinancing your mortgage can cut down your monthly payments or shorten the duration of the mortgage.  You can get a decent interest rate if you’ve already built up some equity in the property and have a decent credit score.  You have more freedom with how you choose to live in and style your home, as well.


Buying Cons

Mortgage interest is not the only cost of owning a home.  The property is your responsibility, so you need to take care of regular maintenance, especially if you want it to keep it from decreasing in value.  In addition to the mortgage, there are property taxes, utilities, repair costs, lawn maintenance, and insurance to deal with too.  There is always a risk of financial loss if the house drops value over the years. It takes a lot of effort to maintain a home and for a lot of people, it can feel like it’s tying you down to one location. 


Renting Pros

Starting with the most obvious pro: renting a home is cheaper than buying one.  You don’t have to worry about repairs and maintenance (for the most part), so your budget becomes much more predictable.  You’re not exposed to the sometimes harsh realities of the real estate market.  It’s easier to rent with poor credit.  Most importantly for those looking to find a home now, it’s a lot easier to find a place to rent than it is to buy.  With sites like RoomHere, you can easily compare different options and find one that’s right for you.  With no long-term commitments, it’s the safer choice for those who aren’t ready to fully commit to a certain location.  Finally, money otherwise spent on a down payment can be invested and given time to grow.  


Renting Cons

Naturally, when you rent a home, you don’t put anything towards ownership of the property.  Monthly rent is only paying for temporary living costs with no long-term investment.  The lower costs make it easier to build your savings, but many believe that money is better spent towards buying a physical asset like a house.  Although paying a mortgage for thirty years may seem like a long time, at least there is an end to the payments.  If you never purchase property, you will have to pay rent forever.  One of the other big issues with renting is the lack of freedom.  You have limited say on everything from the color of the walls to your service providers.  I remember paying a special fee just to have a pet cat, back when we lived in an apartment.  



Your occupation, lifestyle, and financial situation are all going to play a big role in figuring out which option works best for you. The important thing to remember with these types of decisions is to forget about conventional thinking – just throw it out the window!  You need to figure out which option provides the most benefits that align with your specific goals.  

For us, home ownership has worked well because Mr. Smith is very handy and we’ve always wanted to use rental property as a long-term investment.  We will need to move eventually, but it would be really advantageous if we could make this three bedroom home work for as long as possible, and then use it as a second rental property.  Yes, this is probably a complete pipe-dream, but I’m not going to dismiss it just yet.  You’ll never succeed, if you don’t even give something a chance.  


Readers: I’m working on a special Christmas post, but I need your help!  Please share your favorite Christmas memories from childhood via email to or Twitter. Thank you so much!



  1. Nice post, Harmony. In general, I favor owning. But that’s mainly because I like to take on home-improvement projects. Renting certainly has its pluses. I like the way it allows you to be more versatile. If there’s a great job opportunity on the other side of the country and you own a house, you have problems. Moving and selling is hard. But if you’re a renter, you can jump at that opportunity a lot easier.
    Mr. Groovy recently posted…Personal Finance and EthicsMy Profile

  2. Great article, Harmony. Jenny and I have been thinking about and researching this for quite some time now. I think the plan you have of living in a place, holding onto it for rental income and moving into another home that better accommodates your needs is a good “pro” of buy vs. rent. Sounds like you’ve thought it through.

    In our case, we’re nearing being empty nesters and we will downsize big time. We live in a 2500′ sq ft. home now and we’re looking at 2 bedroom apartments as our downsize solution. Staying put is simply not an option as we don’t want to keep paying the maintenance, insurance, taxes, etc. on a half empty home. And, honestly, while I’m handy like your husband, I’m getting tired of home maintenance and look forward to the flexibility renting would give us.

    But, as you mention above, renting isn’t for everyone and I know people (like my parents) who couldn’t imagine not owning their home. Jenny and I aren’t cut from that block, though. Who knows, maybe after renting for a few years we’ll crave owning a home again and buy something small that fits our needs. (Maybe one of those tiny houses!)

    Jeff recently posted…Financial Independence January 2017 UpdateMy Profile

    1. Hi Jeff! Thanks for adding these great points. There really is no perfect solution for everyone – or every period of your life. We plan to get a bigger home at some point in the near future, because our family is still growing. But we may decide to downgrade once the kids grow up. They really are doing amazing things with those tiny houses. Although, I recently saw one with the dining table hooked up to a winch and cables that lifted it up to the ceiling. Not sure I would want to live like that.

  3. I really love renting because all problems are the province of my landlord. I don’t have to have access to money for unexpected or expected repairs. The biggest downside for me is that I have to have roommates who are not wonderful to live with, but that’s because my high COL area. Maybe someday I could afford to have my own bathroom.
    ZJ Thorne recently posted…Goals 2017 – Accountability and Chutzpah!My Profile

    1. Oh yes, a bathroom all to yourself. It may surprise you to learn that this is also a fantasy of mine. LOL – kids aren’t always the best at giving you space, anywhere!

      If I didn’t have super-handy Mr. Smith or a small emergency fund, renting would probably be the best choice for me. There is something to be said for being able to call someone up to fix things, for free.

Leave a Reply

Your email address will not be published. Required fields are marked *

CommentLuv badge