October 08, 2010

More Renting Myths BUSTED

Man, the media seems to really be pushing renting over buying these days.  It seems that there is an article out there daily about the "benefits" of renting over owning.  I'm sure that the landlords of the nation are loving it.  Nevermind that the "data" supporting the articles usually come from places like Apartments.com or the National Landlords Association (which, btw, is Why it's Important to know WHERE the Data from a Survey Came)

Awhile back, a posted, It's Better to Rent than Buy: Busting the MYTH! when one of these articles was pushing truly false information.  Now, Yahoo publishes this article and it's time for a new post as well.  The article was originally published by Steve Thompson on Associated Content, but it seems that it's no longer there, so I linked to the Yahoo post instead.Popping Balloon

Basically, Mr. Thompson lays out 10 reasons why he thinks renting is better than buying.  He goes into details for each, but for those that don't like to click on links his ten reasons are as follows:

  1. No Property Taxes
  2. No Association Fees
  3. No Maintenance Expenses
  4. No Roots
  5. Free Utilities                          Photo courtesy of AMagill Flickr Photostream
  6. Lower Utilities
  7. Free Perks
  8. Less Risk
  9. Lower Insurance Rates
  10. Opportunities for Investments
As a former landlord, I can say this with absolute certainty; landlords LOVE people who think like this.  They are the reason landlords become landlords.  Why?

Mr. Thompson has items 1, 2, 3, 5, 7 and 9 as "perks" because they're "free."  I hate to break it to you, but they're not free.  He even mentions sometimes that they're "included" in the rent.  They are ALWAYS included in the rent.  Always.

He mentions lower utilities because apartments and condos are usually smaller than a single family house.  In a word, DUH!  A smaller house would have lower utilities than a larger one.  This is plain common sense.

Renting to him is less risky because you don't have to worry about foreclosure.  Has he read a paper lately?  If the landlord gets foreclosed on, trust me, you, as the renter are going to be worried about it.

Finally, he mentions 'Opportunities for Investments'  By not having his money 'tied up in the equity' of a house, he could invest it somewhere else.  First, you never have money 'tied up' in equity.  You either have equity, which gives you a means to possibly get money, or you don't have equity.  Second, a house payment is usually fixed and has a set number of payments.  A rental payment usually goes up annually and is until death.

The only real, honest perk to renting in all of his 10 reasons is "No Roots."  It is fairly easy to quickly pack up and move if you're a renter.  If moving around alot is your lifestyle, either through choice or through work, then renting is definitely the best choice for you.

Some people prefer to rent over buying and I'm not knocking that choice.  But, please don't use these reasons to try to convince yourself or others that it's 'better' than buying.  Nothing is ever free.


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