Your Money: The Missing Manual

by J.D. Roth

On the other hand, the advantages of renting include: Flexibility. With a rental, you don’t have a long-term commitment. You can move on short notice, whether to get away from bad neighbors or to take advantage of lower rents elsewhere. There’s also a wider range of rental options than homes for sale. It’s difficult to buy a tiny house, for example, but you can easily find one- or two-room rentals. Lower costs. In the June 2007 issue of Kiplinger’s Personal Finance (http://tinyurl.com/kip0607), editor Knight Kiplinger wrote, “It often costs less to rent. The annual cost of owning a property, be it a house or a condo, is usually greater than the cost of renting, after taxes.” True, you don’t build equity when you rent, but you’re not burdened with taxes, insurance, and maintenance costs either. You can use the money you save to travel or buy stocks. Lack of responsibility. When you rent, somebody else does the yard work and repairs the leaky showerhead. (Of course, this can be a disadvantage if your landlord is slow to respond to problems.) All you do is stick to the terms of your lease or rental agreement and someone else takes care of the rest.