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2 Bumps

why does it cost more to rent a home than it cost to buy a home?

I mean by the time you rent a house for X amount of years you could have owned one.

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kina803

Asked by kina803 at 9:17 AM on Nov. 3, 2010 in Money & Work

Level 11 (503 Credits)
Answers (13)
  • Houses also have down payments and upkeep and taxes and insurance to consider. In addition, renting properties is often a business. Just like you get paid for going to work landlords need to make a living.
    tootoobusy

    Answer by tootoobusy at 9:20 AM on Nov. 3, 2010

  • I understand that, but I have been renting a home for $475 a month for over six years had I known my house payments were going to be around the same payments of my home I would have bought a home years ago.
    kina803

    Comment by kina803 (original poster) at 9:29 AM on Nov. 3, 2010

  • It doesn't. When you buy a home you have to come up with all that money at once, then continue to pay your mortgage, plus insurance, upkeep etc.
    older

    Answer by older at 9:29 AM on Nov. 3, 2010

  • It isn't just the rent money, you would probably have to give a big down payment to be paying that little.
    older

    Answer by older at 9:30 AM on Nov. 3, 2010

  • I didnt have a down payment
    kina803

    Comment by kina803 (original poster) at 9:33 AM on Nov. 3, 2010

  • $475 is cheap for rent or mortgage on a house, ours is $995 for a 1300 sq ft house. We own a double as well and charge $575 a month in rent for each 2 bedroom apartment, the mortgage on that house is $589
    Mom2Jack04

    Answer by Mom2Jack04 at 9:35 AM on Nov. 3, 2010

  • When you rent, the money you pay goes into the owner's mortgage, insurance, taxes, upkeep costs, and the cost of paying all of those between tenants. Plus, the person who owns the property wants to get some additional benefit (what the market will bear,) since they assumed the risk of buying it in the first place.
    SWasson

    Answer by SWasson at 9:46 AM on Nov. 3, 2010

  • Yep, when it gets to the point that the rent is the same as the mortgage, then its time to figure out how to save the downpayment money and buy a house of your own. Unless, if course, you'd rather not deal with the upkeep, maintenance and costs of replacing or repairing things every time they break, etc. I'd much rather own my own house, even with the extra expenses - I'd rather not have someone else telling me what I can and can't do in my home !! I had to rent for 5 years and absolutely hated it - and our rent was $1250 a month (so your rent is cheap !!). My house payments are not all that much more than my rent was, but I also live in a fairly expensive part of the country, have a 3000 sq. foot house, and 3-1/2 acres.
    JustMyOpinion22

    Answer by JustMyOpinion22 at 11:35 AM on Nov. 3, 2010

  • You're not figuring in the costs of home ownership. A home owner is responsible for insurance, property taxes, repairs and maintenance, and for miscellaneous fees/costs, right along with a house payment. As a renter, you're not responsible to replace a furnace or air conditioning that dies, or to pay to have a new roof put on the home, or for any plumbing or electrical issues that arise. Some landlords even pay for snow removal (if necessary) and trash removal services.
    My parents are owners of a home they rent out, and they have to have $150 a month just to cover the insurance and taxes, let alone if something breaks and needs repair, or if the house has to be winterized while it's sitting empty.
    michiganmom116

    Answer by michiganmom116 at 12:03 PM on Nov. 3, 2010

  • it seems like the cheaper thing in short term i think. you dont have to pay for repairs would be a bonus as something always goes wrong in my house...usually 2-3 things at once.
    stargazer74

    Answer by stargazer74 at 12:41 PM on Nov. 3, 2010

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