Personal Finance

I Own 24 Units But Choose to Rent—Here’s Why

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Portrait of a concentrated Asian accountant at her workplace using her calculator. Concept of accounting in business.

After living in the same area for 20 years, we decided to go on an adventure and move to a new city. Most homeowners would sell their place and buy a new one. Not us.

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Even though I’ve been a homeowner many times over and own 24 units (soon to be 28!), this time around I decided to analyze the situation with an open mind.

Would buying or renting make more sense? It may be surprising to some, but here are several reasons why we decided to rent.

7 Reasons We Decided to Become Renters Again

Reason #1: No maintenance

One of the things that bugged me the most about a house (and a decent-sized one at that) was all the maintenance involved. Mowing the lawn, painting the trim, staining the deck, replacing screens, repairing the roof, landscaping…

I didn’t like one minute of any of these activities (or the money it cost me).

With an apartment, the only thing we really have to do is keep the place clean (which is a monumental challenge with two little kids). The first week we were here, the microwave stopped working. A new one was installed the next day.

We also had some condensation issues with some of the windows. Those were replaced, too. I didn’t have to lift a finger—or pay for it!

Related: To Rent or To Buy: A Complete Analysis for Prospective Homeowners

Reason #2: Freedom

Renting frees us up in a lot of ways. Owning a house really does tie you down in some regards. Who’s going to mow the lawn or check on the house while you’re on vacation? What if there’s a leak while you’re gone?

It frees up our time immensely because we’re not focused on all the maintenance. And it frees up a lot of money (which I’ll cover later). It also gives us freedom to explore our new city, which leads me to my next consideration.

Man stands in the middle of a busy sidewalk looking at his cell phone while crowds of people walk around on 14th Street in Manhattan, New York City with the glow of sunlight in the background.

Reason #3: Learn a new market or neighborhood

Have you ever made the mistake where you moved into a certain market or neighborhood and then you learn that they’re putting a new toxic waste dump behind your house or the neighbor breeds aggressive attack kangaroos?

Renting helps you learn the ropes of a new market. Especially since we were moving from a town of 20,000 to a city of 250,000, we wanted to give ourselves some time to learn the market, the neighborhoods, schools, shopping… everything.

If we would have bought, we might have been kicking ourselves a year later.

Reason #4: Location

We wanted to be in the heart of the city, within walking distance to as much as possible. There is no way we could have afforded a house in this spot. Renting gave us the location we wanted at a much reduced cost.

Reason #5: Newer construction and more amenities

This won’t always be the case if you’re renting, but we decided to live in a 70-unit building that was newer construction (only 10 years old). Awesome location, underground heated parking (hard to find around here), a general store literally steps away, gym, entertainment, shopping, dining.

You name it, we got it.

Related: Grant Cardone Is Right: Owning a Primary Residence Usually ISN’T Smart

Reason #6: Real estate taxes

Our taxes were out of control. Usually you think of your mortgage, taxes, and insurance as a fixed cost. While your mortgage is, the other two can change—for the worse.

At the lowest point, we were paying $1,800/month for all three. At the highest, we were at a staggering $2,400.

While rents can go up, too, typically they don’t go up as much as taxes have the potential for. Our rent will go up this year if we renew, but it’s only going up $10/month. I think we’ll be ok.

apartment-complex

Reason #7: Our overall expenses decreased substantially

We’ve talked about this a little already but let’s dive into the numbers and see just how much we’re saving.

Old place

Here’s a breakdown of the numbers at our old place:

  • Mortgage/Taxes/Insurance: $2,200
  • Capital Expenditures/Maintenance: $500 (2% calculation based on newer construction; this number could certainly be higher)
  • Utilities: $400
  • Lawn Care: $140
  • Pest Control: $30
  • Total: $3,270

New place

And here’s a breakdown of the numbers at our new place:

  • Rent: $2,200 (includes underground, heated garage parking)
  • Utilities: $130

THAT’S IT!

We’re saving $940/month currently. One caveat here: we are living in a smaller place, but we actually love how it simplified our lives.

The Downsides

The only downside I can think of right now is potential opportunity cost. We are probably missing out on appreciation (the Madison market is hot) and debt paydown. But we’re just not quite ready to jump back into homeownership yet.

What Would You Do?

Now, this is not a knock on homeownership. I think it’s incredibly important and gratifying for the right person. Right now, it’s just not us. We may house hack in a year or two, but until then we are renters.

Even though I’m a landlord to dozens of other people, I’m fine with having a landlord, too.

If you were in my shoes, would you have done the same thing? Or something different?

Let me know in the comment section below.

Nate Shields is a real estate investor and real estate investing coach. He started in real estate in 2013 part-time as an agent and quickly went full-time, enabling him to quit his 9-5. In just two...
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    Erik Whiting Real Estate Investor from Springfield, MO
    Replied 3 months ago
    I am not against renting. In some cases it makes sense. However, I have a few thoughts about the 7 reasons given in this post. . 1) No maintenance - the maintenance costs are "baked into" the total rent paid. Yes, you are paying them... a little at a time, each month. The only advantage a renter has is if they move in right before a major CapEx expense hits (HVAC unit dies). Then yes...you get something expensive ($6,000 or so) for the small slice of maintenance that is part of your monthly rent. . 2) Freedom - yes, this is a legit reason to rent. . 3) Learning the market - sort of true. A renter still has to choose a place to rent, and knowing the market allow him/her to make a better choice. I would say the best part of being a renter is if your neighbors do start breeding aggressive kangaroos, you can complain to your land lord to "fix it", and if he doesn't you give notice of non-renewal and can move in less than 12 months. . 4) Location - Highly desirable locations will cost more to rent than less desirable locations, just like owning a home in them commands a higher price. It is true that in some markets the price to own has increased more than the price to rent, but apples to apples you will always pay more to live in a prime location regardless of renting or owning. Or unless your LL is timid and never increases his rent. Or if you live in a rent-controlled location and your increases are capped. . 5) Newer construction and amenities. - Possibly a good deal. I've known plenty of folks who rent apartments and use the weight room for a month, then never see it again. And after getting in that wonderful pool where all the other tenants' kids are peeing....eyew. Never been a huge fan of "public" pools, but to each their own. And again, you are paying for those "included" amenities. The rent must be enough to support them. Cheaper than having your own pool and maintaining it, sure, but gym memberships are ultra competitive now--$10/month--in my town for Planet Fitness, and they always seem to have better equipment, more equipment, and cleaner facilities vs. an apartment complex. Who knows? Maybe you found a really good one. . 6) Taxes. Yep, you're paying for those in your rent, which you admitted. This can be a "win" since you + 69 other residents are eating the bill, and GENERALLY tax authorities seem to raise taxes less per unit on an apartment vs. a house. . 7) Decreased Expenses. Could have been achieved by purchasing a smaller house in a less expensive location. Glad it worked out for you, but "downsizing" is not exclusive to rentals, which I'm sure you know. . What would I do? I'd make the decision that makes the most sense for me and my family after running a thorough and accurate side-by-side analysis. That said, real estate is a fickle thing and aspects like location (location, location!) can sometimes make the more expensive deal still worth doing. One strategy we used when buying last year is we bought our house in the 3rd most desirable high school district in our town vs. the most desirable. There are six high schools, so we're still in the top half. Plus our town has open transfer, so as long as there is space available we can still send our kids to the "trendiest" high school. That decision knocked about $70,000 off the price of the house we got vs. houses we viewed with comparable square footage, age, and amenities in the highest rated school district. By extension, our insurance costs are also considerably cheaper since a less expensive house costs less to insure. It also knocked about $800/year off our tax bill vs. the comps, again because lower value = lower taxes. Ours is a nice house in a nice neighborhood, just not a "trendy" location. I can live without trendy.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 3 months ago
    Erik, thanks for all your great points. There are so many variables to situations like this. And some are weighted more than others in the decision maker's mind! I like your way of thinking about the school district issue. I think you made a good choice!
    Andrew Hargreave Rental Property Investor from Shorewood, IL
    Replied 3 months ago
    Nate, nice article. I can vouch for the boom in Madison, my son is looking to get out of the high rental prices and buy a duplex/multi-family and have tenants pay a large portion of the mortgage. He has 4 other people ready to move in...now to just find a place that's central enough to the college, the church he's a band member of (and the tenants are as well) and close to his work in DeForrest. (know any offmarket deals? haha) One thing you kind of left out of your expense calc on the house is the mortgage interest tax break on your taxes. I'm in the Chicago Western burbs and the property taxes in IL are killers. When my last 2 boys leave the house, I'm trying to convince my wife to move somewhere warmer, downsize..and I've thought about renting for a time to see how things work out. So these are some great points.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Thanks Andrew! We were also in the far west burbs...yes, the taxes are killer! Has your son been to any of the real estate investment meet ups?
    Gerald Pitts Rental Property Investor from Nashville, TN
    Replied 3 months ago
    I'm going through this now! Leaving Nashville, TN to move to Asheville, and just did a quick buy vs. rent analysis on zillow for kicks. It ended up inspiring more digging into this. According to the (perhaps rinky dink) zillow study, If i buy, i would need to stay in the home for 2.5 years to come out (only slightly) better than renting. But i'm clueless of the area and may buy somewhere i'm unhappy with, and want to move way sooner than 2.5 years. I can also save my down payment for another vacation rental, and make cashflow on that while I'm figuring out the Asheville area.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Gerald, sounds like a very similar situation to ours. Good luck!
    Tom O.
    Replied 3 months ago
    You already own 24 units? Go live in one of them. Or buy another building and live in it and get that low down payment as an owner/occupier. You are already maintaining those units and paying for that. Also, it's a mistake to lump mortgage in as an "expense" when you are also getting principal paydown, which is essentially paying money to your self or saving money in the form of equity. And you do mention losing appreciation so that combined with equity paydown can be pretty valuable. The point of your article is fine, however. There's plenty of reasons to rent even if you own units.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Tom, thanks for reading! All these units are in other states, so unfortunately we can't owner occupy them. And yes, principal paydown can be phenomenal depending on how your loan is structured.
    Keston John
    Replied 3 months ago
    i’m glad this works in your situation. In my city, rents go up 10% per year. With the right down payment a multiunit or sf can save you big bucks. Also renting is only freedom if you’re not under a lease when you need to leave. At least if you own you can air Bnb your house, and have a neighbor or friend take care of the rest.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Thanks for reading Keston! Every market is different for sure.
    Susan Maneck Investor from Jackson, Mississippi
    Replied 3 months ago
    As my mother always said, whether you rent or whether you buy you pay for the space that you occupy. When I moved I waited two years to buy. It made sense. It also made sense when my house went underwater during the Great Recession that I started buying up houses in the neighborhood!
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Susan, good for you!
    Alan DeRossett Investor from Thousand Oaks, CA
    Replied 3 months ago
    You can rent from your self, but its always cheaper to own. unless you move around a lot and like higher property taxes stay put and pay off your mortgage. buying and selling only increases your loan fees and closing cost. A Doctor friend rented 10 years ago telling me I'm stupid too buy his rent was cheaper. and he's missed out on $400,000 in appreciation. sure I had to pain and do improvements and he did not. but the 400,000 was worth it. he now does not have and still rents.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Thanks for reading and thanks for the comments!
    Andrew Dayao
    Replied 3 months ago
    What he didn't tell you was that he took the extra money he wasn't obligated to put into a mortgage and invested it in the equities market, profitting $700000. Just because somebody rents isn't a guarantee they're losing money.
    Vaughn K. from Seattle, WA
    Replied about 2 months ago
    It really is though... The gap between perceived savings by renting and whatever returns you make off of that will never equal out to being better than buying.

    In SOME markets rent is cheaper than the mortgage, mainly trendy cities where investors are banking on appreciation to make the math work out long term. But in cities like that your rent will climb quick over the years, whereas a mortgage would not. You'll have paydown and appreciation yourself. Even if you save $500 a month by renting in the beginning, 3/4/5 years down the road your rent is now as high or higher than your mortgage, and you were losing $500 a month in paydown, tax write offs, etc the whole time anyway!

    People trick themselves into thinking the math works in many ways... Comparing a 2 bedroom apartment to a 4 bedroom house, instead of comparing renting said house to buying said house, or buying a 2 bedroom condo to renting a 2 bedroom. Apples to apples the math never works out beyond the span of a couple years. This is why they ONLY good reason to rent is if you aren't sure if you'll still be living in the same place in a few years. Otherwise it never works out in terms of math.
    Andrew Dayao
    Replied 3 months ago
    What he didn't tell you was that he took the mlneu
    Josh Stevenson Property Manager from Portland Seattle, Bellevue
    Replied 3 months ago
    I rent as well, I also own multiple properties where the rent coming in can be sometimes more than I make in a month, on any particular Home or Condominium I own. That said, I rent a Luxury (Condo) Apartment in Downtown Portland, Oregon. If I were to have bought this unit, as it was for sale before asking if they would consider a lease My mortgage would have been around $2450.00 a month with me putting down 30%, then there are all the other costs, like Gas, Internet, Electricity HOA dues which by the way are for this unit $775 a month, as the bldg has EQ insurance and multiple amenities, as well as 24/7 Concierge. The taxes alone are the highest in all the counties of Oregon at 1.4% which is really high as we have no State Sales Tax. The unit is a 2 bedroom/2.5 bathroom 1266 sq feet with 2 small balconies and 2 underground parking spots which I lease out to other tenants/owners in the bldg for $175 apiece. AIRBNB Parking spaces... :) I use the light rail which is exactly out the front door both incoming and going as this bldg consumes the entire block. This bldg also has a 20% Rental Cap and because most of the units start at $550,000+ and go up to the $Millions, only about 7% are actually leased out. What I liked that the bldg does is after the Owner of the unit screens you, The Bldg does it's own Credit/Background Check to make sure for the safety of the Building and its residents. I live on the 21st Floor and have a Fantastic View of the City, Mount Hood, Mount Saint Helens and part of the cascade range. The unit is breathtaking and offers everything I would want in my own unit, Gas cooking, Gas FP (2) of them and so on. Portland now has Rent control and it's at 10% a year. I signed a 3-year lease at the time of taking the listing with the first right of Refusal. Okay and now for the good parts: I only pay $2875 a month + use this as my place of work (Lots of tax advantages) I am coming to the near end of the lease and the owner asked if I wanted to Continue to Rent/Purchase the unit? I spoke with my Realtor and she said the Great news is the rental Price and the bad news is that the unit has decreased in Value only by $50K, But that still is a chunk of money to lose if I had bought. Not sure why Portland's Market is yo-yo-ing in prices, especially on condos, but what I can say is that it is investors Dream!!
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    It's complex, right Josh? So many factors involved!
    Donna Guarino
    Replied 3 months ago
    My husband and I just did the same. Sold our home of 20 years for the freedom and low maintenance of an apartment in a gorgeous new building in downtown. We love the location of apartment, the apartment itself & how easy it is to clean vs a big house! For some reason we are still trying to figure out, we went ahead and bought a house. Such regrets.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Exactly the same for us Donna!
    Jerry La
    Replied 3 months ago
    This is important reading to add some more clarity into my buy or rent needs. When I bought an old tired weed covered potential estate house here in Los Angeles in zipcode 90027 the Los Feliz district, I had no idea that the city would NOT issue me the permits to remodel it for an entire year. They held back only because of the rear retaining wall slightly leaning forward as it was retaining the hillside slope behind it. One year later, the city said, it's okay, leave the wall alone and then they FINALLY gave me my permits to remodel. Until then, the house sat there empty for one year and I would go in to visit it and write in the dust with my finger, seriously. That was the start of what became my financial real estate losses as I still had to pay the monthly mortgage, new higher property taxes, insurance, etc. on it during the year long wait. I finally did transform that house and I emphasize transform. I even designed and built an elegant pool and spa, a master suite with an adjoining library and balcony overlooking the pool spa that I designed and had built. I also lowered the concrete floor in the massive basement so that the space requirements between floor and ceiling would increase thereby being able to add the massive basement to the houses total square footage and the list goes on. Then upon completion a realtor found me a tenant and a lease was made at $15,000 per month. Several months later that tenant was arrested for production Marijuana growing in the house's massive concealed basement. They were even stealing electricity from neighbors and the city directly. Then I had no income to pay my extensive construction loan which that rent was supposed to cover. Currently I have an aging $150,000 judgement to still attempt to collect on that tenant. Then I was introduced to and came to know what turned out to be crooked real estate professionals. They listed it and did a short sale and they illegally purchased it in a family member's name to fool me and the system (because they already knew me personally) plus they took the sales commission as well on that sale and kept it too. Then they moved into it and enjoyed life to the fullest for several years. Then they sold it to the great grandson of a VERY famous, high end musical instrument manufacturer and easily profited $1 million dollars. Again they pocketed the sales transaction commission as well. These same crooks similarly purchased then short sold still another investment property of mine and then sold it at another $1 million dollar profit a couple of years later. Once again they also took the standard sales commission and kept it when they short sold it to themselves and again when they sold it under their own real estate license after a couple of years of owning it and leasing it out. They made and kept numerous real estate sales transaction commissions from these two properties. They were the same people that owned a Private Money lending business and I invested my last penny with them only to find that they were cheating me out of my contractual profits. I sued them, I prevailed and all of my settlement paid my attorney's fees, still leaving me in the negative. They also made me sell my precious home of 40 years and took that sales commission too. Now you have at least some insight on what happened to me and what brings me to write this within this buy or rent thread. Incidentally all of this occurred while having to nurse my then 91 year old mother around the clock during this same time frame. These crooked licensed real estate people are the same people that made me move into a rental house I also own here in Los Angeles 90026 in the Silver Lake district when they sold my house of 40 years and made another sales commision. Now I live in a beautiful "Moderne" 2+2 that I gutted, added square footage to and completely remodeled but NEVER in a million years would ever have wanted to live in it. I had to bring and stuff all of my furnishings, a elegant formal dining room set, etc. into this much smaller house than where I was living in Los Feliz for 40 years. I'm not getting any younger either and I am all alone now. These two purchases that I made and later lost to short sales also left me with a mortgage against my apartment building located in prime Hollywood, CA and a matured equity line turned mortgage against my current house and naturally I am still paying them monthly even though those properties are long gone. I created what became those two mortgages simply to help me finance expenses related to my two new acquisitions that I later had to short sale. Now I am looking into selling my very charming and unique 5 plex in prime Hollywood, CA 90046 as I have been a landlord all of my life. It's a side by side duplex house both LARGE units, plus an upper and lower duplex of more modestly sized but charming units concealed in the gated rear plus a 5th unit isolated and between of my two duplexes which technically makes it all one building with 5 units total. My two LARGE front units are very well suited for owner occupancy. I'm the 3rd generation owning it but I grew up having to be involved with running it. I even lived in it for my first 18 years. So now alone and in my mid 60's I am faced with what to do if I sell my beautiful, high income producing building? What to do with my net proceeds while ridding myself of those two costly mortgages that shouldn't even exist. This also would mean selling my lovely house that I never chose to live in, it was only intended to be leased. Do I need to do a 1031 or 1031NNN? If I have to be a landlord, then I might as well keep my extremely well invested into, dramatically improved upon and lovingly maintained, high income producing unique 5 unit apartment building. You can tell I am a proud owner but I'm tired of being a landlord. So what should I do next? If I sell both of my two remaining properties, I still have to live somewhere and enjoy my solo life somewhere that I would enjoy living. I can't see myself ever renting an apartment as I have never lived in rented property and being a hands-on landlord is in my blood. On the other hand, I have yet to live and enjoy life. Any genuine advise? [email protected]
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    You've had quite the journey Jerry. I think it all comes down to the lifestyle you want to live and what your goals are. If you figure those two things out, then you're well on your way to success. Best of luck!
    Jacob Morgan Investor from CO/MD/NY/VA
    Replied 3 months ago
    I've concluded the same, that sometimes renting is better than buying from both a cost perspective and a lifestyle perspective. Currently, I'm based inside the Beltway on the Virginia side of DC. Buying here now is nearly impossible without incurring monthly costs of at least $2500, yet rents for decent comparably sized apartments including utilities can be found for around $2000 or less much closer to the city center. I know this calculation looks different for those who have owned their homes for 10 or 20 years and have accumulated a lot of equity, but for those getting into the market now on the ground stage, it looks impractical. In my experience, living around expensive cities such as DC and NYC means that buying will consume most of your available cash for investment, and will put you in a less than desirable area from a convenience perspective (i.e. a non-transit connected suburban neighborhood with a long commute and fewer amenities contrasted with an urban location with good amenities and transit connections).
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    You're spot on Jacob. Thanks for reading and commenting!
    Ika Sargeant Real Estate Agent from Reston, VA
    Replied 3 months ago
    I live around the Washington DC-VA- MD area. Yes home prices for some areas have sky rocketed. Places like Arlington VA they have 40% drop in inventory and the effect of this has meant higher prices in Arlington. We are seeing a steady increase in home prices in many areas and so if you are looking to buy, its still a tough market. However the rental prices are also up. We have a strong demand in rentals especially closer to DC. The average 2bed2bath is going to price around 2K. I think renting is valuable for short term periods and certainly use a calculator to find that break even point for rent vs buy. I would say if you are in our area for 5 years plus renting, you are now bleeding. Most people are just stuck with renting-because they can not raise these large amounts of money for buying.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Ika, yes some people don't have the choice because they are living paycheck to paycheck. They have to rent because of their financial situation.
    Mark Cruse from Fort Washington, Maryland
    Replied 2 months ago
    Still, with renting you are giving all your wealth to someone else. From the numbers you listed it doesnt seem like that much more. Also, there are places around DC not as expensive. No matter what you pay, if you own you are building equity and wealth you not other people.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Mark, thanks for your insight!
    Kurt Alder from Panama City Beach, FL
    Replied 2 months ago
    Interesting, some good points. I would subtract the equity your putting into your mortgage from the total cost of buying. Wouldn't include appreciation BC it's speculative and I think the cost comparison would be improved
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Thanks for reading Kurt! I agree with you depending on where you're at on your loan and what the amortization is like.
    Joe Scaparra Investor from Austin, TX
    Replied 2 months ago
    I hate to rain on your parade but this article has so much misinformation especially to an audience of real estate investors. Maybe we should start out with a goal in mind. If for this article the goal was stated, i rent because I desire total freedom to change housing for my family, regardless of the cost. Then the points you make might have some meaning. However, lets look at each point you make and take a more objective view, shall we. 1.No maintenance! Wow, this got the number 1 ranking. Had microwave and windows problems and you didn't even have to pay the cost. Here is why that is misleading. You in fact are the one paying for those cost. It is baked into your rent!!! Here is also what is baked in, your lack of control as to when it gets fixed. Landlord can make a priority or not to get it fixed. If you get tired of waiting and pay for it yourself, you may not even get reimbursed. If it is not fixed to your satisfaction (repaired or replace new) you have little recourse while in a term on lease. Yeah the lawn you share in apartment complex doesn't belong to your exclusive use and subject to trash you didn't put there. 2. Freedom. Really? Don't have to worry about mowing the yard and someone else will check on the house. How about if there is a leak? If you own you have a choice do the lawn yourself or pay a lawn service (just like the renters do with their rent). Sorry but while on vacation the landlord and or property manager is not going to check on your home. If there is a leak it will get fixed when you get back whether you are renting or owing. (Again renters pay for the repair regardless with their rent). In apartment the common area is covered by the apartments but individual duplexes I rent are still the responsibility of the tenant. Either way the renter pays the cost. How about this for freedom, owner wants to move back in to the property and doesn't renew your lease. Or the property manager and you get cross ways and for trivial reasons decide not to renew you. Who then has the freedom to stay or go. 3. Learn a new market or neighborhood. This should've been first on your list as it is the best logical reason you gave to rent before you buy. Yes if you are unsure of where you want to live then yes this could be a good reason to rent. 4. Location. The area is too expensive to buy, but reasonable to rent. Yes this could be a situation. But if you put it in context of building wealth through real estate then sacrifices might need to be made. That ideal home or location might just have to be put on delay. Valid argument, goes hand in hand with number 3. 5. Newer construction and more amenities. Again Really???? You compare renting in a 70 unit apartment building with two kids better than renting a home, because of amenities. Wow! Most if not all people I know that have experience living in apartments vs home, would chose the home. Park right at my door, no one lives above me, below me and on the side of me. No control of private outdoor space. Trash goes into the dumpster two building over. But hey I have a small community pool and meeting room I will never use. 6. Real estate taxes. A renter doesn't have to pay them. News flash, yes you do. It just call under a different name....RENT! Undisciplined people rent. Discipline people own. Paying taxes all at once at the end of the year works well with people who can budget and are financially discipline. 7. Our overall expenses decreased substantially. Sorry, very misleading here! Just comparing utility bills should be the same regardless of renting or owning, UNLESS you are comparing UNLIKE properties. Yeah I can make my argument better, you rent out a mansion and I will buy a cracker box and my utility bill will be lower than yours....ha ha ha. Come on Man, Nate your better than this. Your arguments are invalid, if not, then no one would but property to rent out as we all would lose our shorts!!!! Ok let me help you out. You should rent if: 1. You're new to the area and want to get a feel for the community. 2. Your paycheck to paycheck and have no reserves to help you out in a pinch. 3. You don't have the down payment to buy and credit sucks. 4. You have kids and don't want to put them in the only neighborhood you can afford to buy. 5. You know that you will be moving in three years. 6. Maybe this should be first, but you don't want to house hack so you are going to use your down payment money on investment real estate over buying a personal residence. There are probably a few more reasons, these are just off the top of my head. Yeah, now go write a useless article about how is better to rent than buy. Cheers.
    Nate Shields Rental Property Investor from Madison, WI
    Replied 2 months ago
    Joe, thanks for taking the time to read the article and leave such detailed comments! You pointed out a mistake I made. I should have clarified that this list was in no particular order. Sorry about that! This indeed was a deeply personal lifestyle decision for our family and I'm glad we made it! I didn't mean to be misleading in any way. Just wanted to get people thinking about the variables than can come into play when thinking about renting vs. buying.
    Joe Scaparra Investor from Austin, TX
    Replied 2 months ago
    5. Newer construction and more amenities. Again Really???? You compare renting in a 70 unit apartment building with two kids better than renting a home, because of amenities. Meant to say:5. Newer construction and more amenities. Again Really???? You compare renting in a 70 unit apartment building with two kids better than OWNING a home, because of amenities.
    Dave Rav from Summerville, SC
    Replied 2 months ago
    Your post sheds light on something I hadn't considered. I have been a homeowner for over 11 years and I love it! However, you bring up some valid points. The taxes component (in the monthly PITI) as well as the maintenance (both CapEx, and ongoing maint) are strong points. And you're right, rent can be raised but it typically isn't by $100 per month (though there are no guarantees and this is completely out of your control). The one huge negative to renting though, is you make those payments, and you get nothing in return. *No equity*. However, if this isn't important to you then - who cares! To each their own. I will challenge your CapEx estimate. I believe, for newer construction OR a home that just had most major systems replaced - your CapEx is HIGH. Especially in the case of if one has a good, reliable home warranty. We pay $80 per month for our home warranty and have a $500 deductible for the vast majority of systems (the roof may be higher). Our real cost will NOT be $500 per month.
    Nate Shields Rental Property Investor from Madison, WI
    Replied about 2 months ago
    Hey Dave, thanks for reading and for sharing your thoughts! Fun fact, one of our properties is in Summerville!
    John Van Uytven Property Manager from Oconee, IL
    Replied 2 months ago
    Glad I am not the only one who has thought about doing this.
    Nate Shields Rental Property Investor from Madison, WI
    Replied about 2 months ago
    Thanks for reading John. Are you thinking about selling, then renting?
    Herly C. Rental Property Investor from Fort Myers, FL
    Replied 2 months ago
    I recently made the same decision. Moved out of our hometown and decided to rent for the first time since being college kids. Everything you mentioned was part of our decision. Glad to hear I'm not the only one who thought about it that way.
    Nate Shields Rental Property Investor from Madison, WI
    Replied about 2 months ago
    Thanks for the comment Herly. Sounds like we're in the same boat!
    Vaughn K. from Seattle, WA
    Replied about 2 months ago
    The truth is in terms of finances, renting is NEVER the better idea in the long term. Ever. Ever. EVER. The only way renting makes more sense is if you aren't sure if you want to be there beyond a few years, or if you're willing to really be paying MORE money for a "lifestyle" choice. It will never make financial sense beyond a couple years out, even in overpriced trendy cities where rent is cheaper than a mortgage for the first couple years (until those 10% rent increases catch up to you!). Period. One could theoretically make arguments about trying to time the market or something with their buying and stuff like that where it might make sense to argue it could be a net positive for a few years longer, but that's still speculative really. If you're going to live somewhere for 10, 20, 50 years, whatever, renting will never make you better off financially. People who say otherwise don't know how to do basic math with respect to investments/returns/etc.
    Nate Shields Rental Property Investor from Madison, WI
    Replied about 2 months ago
    Thanks for your perspective Vaughn. For us, this was not a financial decision. It was definitely a temporary lifestyle choice. We'll probably house hack in the next year or two.