Renting a home is an attractive option for many people because it can be less expensive than buying. Renting also gives you more time to save up the necessary funds to buy your own home without being strapped to monthly mortgage payments that are higher than what you would pay for rent.
Renting works for young professionals, new starting, or working students because it allows them to live within a budget while saving money on housing costs. They often wait until the situation changes and/or improves before they think of signing up for a mortgage.
If you’re exploring the idea of renting, make sure to have renters’ insurance, which protects you if your belongings are damaged or stolen, and liability insurance to protect yourself if someone gets injured on your property.
You can maintain control of your financial future even without owning a home by taking these extra precautions. Here are other cost-saving advantages when you rent a house or apartment.
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Renting a home can be an affordable option.
Many people opt to rent because it is less expensive than buying. Since your monthly rental payments don’t include an extra cost for the property’s underlying mortgage, you save on interest and principal every month.
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Not having to worry about maintenance and repairs.
For many people, renting is a better option because you don’t have to worry about paying for maintenance and repairs on the property. As a renter, you can call your landlord if something needs fixing or replacing. The downside of this benefit is that renters are typically subject to restrictions by their landlords regarding what they can do in terms of remodeling and decorating.
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Rent is determined by the location and features.
People who want to save on rent don’t choose prime property. Instead, they go for older ones with lower price tags. If the location suits their needs, they rent it and save money on transportation costs.
Additionally, rent is typically determined by a property’s age and layout, not its market value. This means that renters tend to pay less for housing in less desirable neighborhoods. Most of the time, they’d instead take the train or bus or drive back to the city than pay higher monthly rent.
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Homeownership carries with it a lot of responsibilities that renters do not have to deal with.
Some people prefer renting because they don’t have to worry about the homeowners association, property taxes, and/or special assessments. Plus, it can be time-consuming and expensive to maintain your home in addition to paying the monthly mortgage bill.
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Renters aren’t tied down financially when there’s a drop in interest rates or house prices.
You can take advantage of a better interest rate or lower housing prices even if you’re already locked in with the current rent.
On the other hand, homeowners are stuck with their house and mortgage rates unless they go through considerable expense and trouble refinancing. Aside from these benefits, many renters may also prefer not to take on financial risks involved in homeownership.
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Rental homes provide temporary housing opportunities for those moving within the next few years.
Young professionals move to where the best career opportunity takes them. A new job in another city or state may require them to relocate, making renting an excellent option. The same goes for students pursuing degrees or graduate school. When they apply for grants and scholarships, they may have to move to a different city, state, or even country!
When you’re renting, it will be easier to pack up your bags and leave. You won’t be tied down by the process of selling a house or finding someone to take care of it for you while you’re away.
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Renting is an opportunity to see if homeownership is right for you without having to commit too early.
Many people prefer renting because they are not entirely sure whether owning a home or staying in an apartment is the right choice. Renting is an affordable way for them to try out the two options and see whether homeownership or apartment living suits their lifestyle better.
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You can use the money you save on rent for investments.
The money that would have been spent on monthly house payments lets you invest in other assets that could be more lucrative in the long run. If you’re starting your career, you wouldn’t need a large family home anyway. A smaller place will do, and you can invest your earnings into starting a business, buying stocks, or purchasing bonds.
The Takeaway
Rental rates for homes and apartments are often less expensive than the mortgage payments for buying a home. Renting is also an attractive option if you’re not yet ready to buy, don’t have enough money saved up, or want to explore your options before making such a big decision about where you’ll live long-term. If it sounds like renting might be right for you, take some time today to learn more so you can make this crucial financial move confidently.
