If you want to look like a successful adult, one thing you can do is own a home. Or at least that’s what 70% of adults told Wells Fargo.
The bank surveyed 1,004 adults ages 21 and up, finding that most of them thought homeownership far outpaced life events like marriage and having children when it comes to signaling whether someone is successful.
They might have it wrong, though. Renting could be your ticket to more free time, flexibility and even wealth — all arguably markers of a successful life. Here’s why you might want to forget what the crowd says and consider renting instead.
1. No hidden costs
When you buy a home, you’ll face some costs that may surprise you. For instance, insurance, property taxes and other fees tack an additional 2% to 5% onto a home’s price, according to CNBC.
There are also hidden homeowner costs that can include household maintenance, home insurance, HOA fees, property taxes, landscaping and occasional big-ticket replacements, such as a roof, furnace, windows, decks or appliances. All are expenses that starry-eyed new homeowners may not have counted on.
Renters, on the other hand, don’t need to think about most or any of these.
2. Opportunity to create wealth
If you’re interested in becoming wealthy, buying a house might not be the best use of your money.
A study from Florida Atlantic University says renting beats buying for creating wealth — as long as you invest the money you save from renting. That may be especially true in markets such as Dallas and Denver, where home prices are soaring.
3. No property taxes
Depending on your state, you could pay thousands of dollars in taxes for owning a home.
If property taxes make you leery but you want to own a home, one way around the problem is finding a home in one of the states where real estate property taxes are the cheapest.
4. Flexibility to move
Being a renter mean you can move if and when you want. The choice and the flexibility are yours. There’s no worrying about putting a home on the market, dropping property values or buying a new home and mortgage in the new location. You only need to pack and go.
That freedom may have come in handy for people who wanted to move to less populated places at the start of the COVID-19 pandemic but then returned to big cities last year.
5. Easy travel
Traveling, too, is easier for renters.
You put your mail on hold, lock the door and get on your way.
Since renters typically aren’t responsible for maintenance, they don’t need to arrange for someone to house-sit or mow the lawn while they are gone.
6. Low maintenance
Renting gives people a low-maintenance lifestyle year-round. There’s no worrying about weekends spent raking leaves, cleaning gutters and completing home repairs.
When snowstorms hit in the north, homeowners must dig themselves out. Meanwhile, renters stay warm inside while the landlord arranges for walkways and drives to be cleared.
Likewise, if an appliance breaks in a rental unit, it is typically the landlord — and not the tenant — who is responsible for the repairs.
7. Cheaper insurance
Like homeowners, renters do need to buy insurance. But renters insurance is significantly cheaper than homeowners insurance because it insures only personal belongings and not the home itself.
ValuePenguin reports the average annual premium for renters insurance is $187 while homeowners pay an average of $1,083 per year.
8. Cheaper cost of living
The difference in cost between renting and buying a home shrank a bit in the first quarter of 2020, according to Realtor.com’s most-recent Rent vs. Buy report. The report is a snapshot of 593 U.S. counties, taken before the full economic effect of the pandemic hit the country.
Even so, with a medium income, renting was cheaper than buying a home in 81% of the 593 U.S. counties analyzed.
The median monthly cost to purchase a home was $1,584, compared with a the median monthly rent of $1,391.
9. Ready-made community
Not everyone wants to live in close proximity to their neighbors, but many of us enjoy the ready-made community offered by apartment living. Having other families nearby can make it easier for both kids and adults to find friends.
And if you don’t like your neighbors, renting also makes it easier to pack up and move to a community you like more.
10. Extra amenities
A number of valuable amenities often come with an apartment lease.
Depending on the complex, you may get access to a swimming pool, fitness center or free internet service. Some high-end apartments are upping their game these days with fire pits, dog parks, on-site classes and other perks.