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Many have dubbed owning a home as the American Dream.  That being said, renting a home oftentimes makes the most sense.  It also gives you the freedom to move from place to place a little easier.  It’s a lot harder to pickup and move when you have a home to sell.

In many cases, renting a home is cheaper than owning one, even in San Diego where we have seen a steady rise in rental rates.  While a tenant typically supplies a deposit in a lease, that deposit a lot less than a typical down payment.   Tenants are also not burdened with maintenance costs and real estate taxes, which can really add up.

While rents may rise, you’re never at risk to lose investment money when renting.  In fact, renting may free up some capital to invest elsewhere.

Renting does have its disadvantages too.  In many cases renting a home is more expensive than a mortgage on that same home.  That’s typically not the case in San Diego, but in other states this is not uncommon.  Additionally, house payments never cease when renting.  That being said, when you purchase a home there is a term for your payments.  There are no more housing payments at the end of a typical 15 or 30 year fixed mortgage.   The whole goal of owning a home in my eyes is to actually own the whole home down the line.  You don’t get that when renting.

Another disadvantage of renting is that your payments typically rise with inflation.  They’re not fixed like a mortgage payment.  They payment doesn’t inflate away like a mortgage payment.  Many of us have heard about our parents and grandparents low mortgage payments. Ask the older generations… those payments were high when they started 30 years ago.

Speaking of rising rents, you’re always at the mercy of the landlord when you rent their home.  They choose the wall colors, and they control the amenities.  They may or may not allow you to have pet.  It’s their rules.   They also control whether or not they want to continue to rent the home to you.  You never know when they will sell the home.

Renting a home can make perfect sense.  Hopefully it comes with the ability to save for the purchase of your own home.  If you would like to discuss your plan for homeownership reach out to us.




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