Owning is Good. But Renting is OK Too.

by Kristina on December 6, 2010 · 5 comments

Real Estate is a good investment because over the long term the investment value should increase. However, it’s ok to rent. Renting is better for the budget but Owning is better for the bottom line.  Do you choose to rent or do you choose to own your home?

Some people think that tenants who rent an apartment cannot afford to buy a home. This is not always the case.  Some people choose to rent for the convenience and hassle free lifestyle.  Last summer I put down a deposit for a brand new two bedroom condo in a great neighbourhood.  Of course my boyfriend Nick and I don’t need two bedrooms.  But we could use the spare bedroom as a home gym, or an office since we both occasionally work from home.

Last summer mortgage rates were very low, and my bank staff rate made my five year mortgage interest rate even lower.  After I reserved my condo unit I had 15 days to come back to the builder with my deposit and proof of financing.  The day before I was supposed to return to the builder I had a major panic attack.  I woke up one morning totally stressed, and covered in sweat.  Buying a condo was a major financial commitment that I was just not ready to make.  I quickly called the builder and told him that my financing was not approved. Therefore he could put my reserved unit back on the market.

I am not sure exactly what happened that day, or what induced my panic attack; but I knew that I couldn’t buy a condo last summer.  Again, I am not sure why because Nick and I had been searching for a condo for over almost a year.  We visited 6 developments, and this development was the first one that we both agreed on.  I know that Nick was also relieved when we decided not to buy the condo.  He didn`t put up a fight at all. No rebuttal, no arguments, just “ok”.

We are currently in our 3rd apartment in 11 years and although living accommodations could always be better, for the price we pay in rent each month, we are very happy.  We currently live on the top floor of a 21 floor high-rise building.  We have 2 huge parks and several other amenities within a short walking distance.  As we are 21 floors up we have an amazing view.  I am sure that one day we will own a condo, but for now, renting is ok too.

Owning is Good

  • I have more nosy neighbours than I would like to have. Our condo was in a four floor building with only 32 apartments.  Less people to be poking around in our affairs.
  • I hate that my elevator and often other parts of my building sometimes smell like wet dog. Our building allows pets.
  • Shared laundry facilities. This is a less than desirable fact of apartment living.  Always having to make change, and keeping a close eye on my clothes so someone else doesn’t touch them.

But Renting is OK Too

  • One monthly bill. Nick earns a fixed salary but a major part of my income comes from commission.  Therefore it is easier for our budget if we have fixed expenses.  Every month we pay one bill which includes our rent, hydro, and electricity.  We also have full access to a gym, indoor pool, and 24 hour doorman.
  • It is hassle free. Nick and I are definitely not the next Mike Holmes or Bob Vila and therefore when some breaks, or clogs, or malfunctions we just have to file a work order with the office and our problem is fixed within 24 to 48 hours.
  • No liability. We don’t own the building or the structure and therefore when we have damage due to heavy rain, winds, or snow the repairs do not cost us anything.

Photo By Wonderlane

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{ 4 comments… read them below or add one }

1 Wade December 6, 2010 at 11:17 am

Last year my wife and I purchased our first house. I find that there are things that I enjoy about owning and more that I enjoyed about renting. What I like about owning is basically how quiet it is and the comfort that comes from having your own place.

What I liked about renting was the location was in a spot that I did not really need a car, there were two grocery stores, a small mall, restaurants, a book store, a couple of banks, and it was on three different bus routes. Now, they are putting a Target in that area, so I would not have needed to drive anywhere had we kept renting.

On top of the freedom of location, I enjoyed not being responsible for maintenance. All we had to do was keep the inside clean, there was no mowing or snow shoveling. I find with owning a house, there are many costs beyond what you pay for your mortgage. For example, I paid $200 to replace a broken spring on the garage door, $50 on parts to fix a faucet, $25 to replace some screens, and $375 on a storm door.

Wow, after reading your post and writing this I wish I was still renting.

2 Guide at GrowingMoneyStart.com December 6, 2010 at 10:34 pm

We lived in an apartment for 3 years, and it was great! The price was reasonable, and the neighbors were all friendly (albeit older).

In particular this was this one older classy lady that explained that she and her (now deceased) husband lived in the apartment complex for over 20 years and loved the life. She had a nice car and looked very classy. The important thing was that she appeared happy!

However, we did go and buy a house, mainly because we were ready to have kids…

3 Ramona December 8, 2010 at 6:32 am

In Romania we have a bit of a problem with renting. Landlords can be a real pain, sometimes they “visit” you when they want, even if it’s midnight, they increase rent etc. We do have laws, but most rent “unofficially”, so that they don’t pay taxes. The people who use their services don’t have a contract, thus no protection.

So, this can be added to the “not too nice to rent” list.

Still, if you don’t need to really settle somewhere and can find a decent renting space, maybe not entering debt for the next 30 years might actually be a good idea. Renting gives you freedom and a better sleep at night, knowing you don’t owe the bank your money for the next decades.

It really depends on the family though. For some rent is OK, for others owning a house is the way to go.

4 Kristina December 10, 2010 at 3:04 pm

I do enjoy renting because it is carefree. I am sure that I would enjoy having a home because I would have a lot more space, but I wouldn’t enjoy the hassle…shovelling snow and cutting grass etc.
As a renter, I don’t have an asset but I also don’t have any hassles or headaches.

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