Don’t you just hate unexpected expenses? I know I do! When you rent, you will never have to worry about unexpected expenses like a broken shelve in the kitchen. The landlord is required to fix any issues. Not only are that but there hidden costs like HOA fees and taxes. Let the landlord take care of it and you can go on living a worry free tenant life. This also helps with knowing the exact amount of money you will owe your landlord at the end of the month. It creates an environment where you can manage your money efficiently and know exactly how money is being spent.
According to a graph released by the New York Times , many landlords require a rental deposit equal to the amount of one month's rent while a down payment for a house is much higher. For example, with a 5% deposit on a house that has a market value of $175,000 your move-in costs start at $8,750, which is much more than the average one-month rent rate. Also, those buying will want to save up much more than 5% for their initial down payment because the bigger the down payment, the better . In short, bigger down payments can save you thousands of dollars in interest.
Thank you thank you thank you for spreading common sense! I have argued this one for years when so many of my friends were buying because loans were easy to get and it seemed like the thing we were supposed to do. And while most of them ended up being just fine, thanks to a college education and having a job, I can easily see where I would have floundered. I am glad I stuck to my plan of renting because my husband and I simply could not have afforded to live where we want to live or could have made some of the life decisions we’ve made (career changes, paying off consumer debt, saving for long-term travel). Back in the early 2000s when I graduated from college, it was just what you did and I was one of the few who questioned WHY. Now I’m glad I did. Also, there was a great article in, I believe, the NY Times about how BAD of an investment a house, especially primary residence, can be. It’s a rare thing for someone to buy in an area that grows more than a traditional investment, like mutual funds. Now I have a sizeable investment in my retirement fund and no consumer or housing debt. I’m pretty happy with my decisions.