After I finished my post-graduate education, my family has been constantly asking me about my plans to buy a house. They worry that I’m wasting money on rent instead of investing in something that could grow in value. However, my spouse and I have decided to wait before buying a home, and we have many good reasons for this decision.
First, owning a home isn’t always a good investment. Right now, the market is showing that home ownership can come with big risks. Many homeowners are dealing with issues like being upside down on their mortgages or facing foreclosure. Some have even seen their home’s value drop by 20 to 40%.
The financial risks of owning a home are pretty serious. I believe people should wait to buy a house until they can afford a down payment of at least 20%, have an emergency fund for at least eight months, and can cover not just the mortgage but also other costs like taxes and maintenance. We’re not in that position yet.
There are other reasons, too. We’re hoping to move closer to our family in the next three years. As renters, we can leave as soon as our lease is up without any hassle. But if we owned a house, we’d either have to wait until it sold (which could take a long time) or sell it for less than we want.
If we owned a home, we’d also be responsible for all repairs. Right now, when something goes wrong, like a broken shower tile or a sinkhole in the parking space, it’s the landlord’s job to fix it. This saves us a lot of money.
Plus, property taxes are a big expense. Houses in our area have property taxes ranging from $8,000 to $14,000 a year, or about $800 to $1,000 a month. As renters, we don’t have to worry about that.
Home insurance is another cost. We’re currently paying just $100 a year for renter’s insurance. But homeowner’s insurance would cost us five to eight times more, and we’d also have to pay for anything the insurance doesn’t cover.
Home maintenance takes a lot of time. We are both very busy—I’m working from home and taking care of the kids, while my spouse is working long hours in a new career. We don’t have time to worry about lawn care or other upkeep, and as renters, we don’t have to.
Utility bills can be high, too. Our rent covers utilities like heating, water, and trash removal. If we had to pay for these separately, it could add an extra $200 to $300 each winter month.
We do want to own a home eventually, but it’s just not the right time for us. We’d rather wait until we’re better financially prepared to handle all the extra costs that come with home ownership.
For those who are renting now, don’t let anyone make you feel bad about it. Renting isn’t wasting money—it provides a place to live, which is essential. If someone says you’re wasting money, tell them you’re actually saving by avoiding the huge costs of owning a home.