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Buying a House Vs Renting an Apartment

Buying a home can be an exciting experience for anyone. However, in some cases you just might be better off continuing to rent your home. There are many advantages to buying a home. However, it is not for everyone and buying varies from individual to individual. Currently more people are leaning towards renting but this could change in the near future. After doing the research and looking at all the options; Buying a House is the best way to go.

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When someone makes the decision to buy or rent a home they must consider the advantages and disadvantages of each. In buying a home the primary advantage is that you actually own it. You can do whatever you want with it. Also, you are building equity as the years go by. However, when they buy a home, the money they put down for a down payment is an investment.

When the person sells the home they get back the down payment and the amount the property has appreciated in value. When looking at the advantages of renting it is easy to see the disadvantages of buying for some people. Even though you don’t get the money back that you spend.

Renting vs. buying really just depends on your personal needs. Both have advantages, but neither is the perfect choice for everyone. The first list applies to renting an apartment and the second list is for home buyers.

Keep in mind that there are many things to consider when choosing between the two, but this list just touches on a few of the differences. Much of it is just personal preference, so it’s important to figure out what’s right for you.

Advantages to Renting an Apartment:

  • If you move frequently, or you’re unsure of how long you’ll be staying in the area, renting could be the better choice.
  • People in the military are often better off with renting an apartment, since they could be stationed somewhere else at any time.
  • When you rent, you don’t have to worry about things like mowing the lawn, repairing a leaky roof, buying a new hot water heater, or most other things that require maintenance.
  • Renting can also be the first step towards buying a home, since you can get to know the area before you buy a house. It would be a shame to buy a house, then a few months later, wish that you lived a few miles away.

Advantages to Buying a House:

  • When you buy a house, it’s generally a good investment that will increase in value. This might not be the case if you plan on moving right back out shortly after moving in, though.
  • It’s yours to change as you see fit. Want to add a bathroom? Put a shed in the back yard? Paint it a different color? It’s nice to feel like you can do what you want because it’s actually yours, rather than having to read the fine print of your rental lease before doing something as simple as putting up a shelf.
  • Having a yard is one of the obvious advantages, where you can soak up some sun while enjoying some privacy, rather than hanging out at a crowded public pool area. The yard advantage is also important for people with large pets that might not be allowed in an apartment.
  • Home equity loans often come in handy for people that want to redecorate or put an addition on their home.
  • Privacy is nice and having your own yard is great if you have kids, or just like to sit outside and enjoy some peace and quiet.

When you live in some communities, whether you buy a house or live in an apartment complex, some have strict guidelines that you have to follow. In some subdivisions, certain things like the height of your grass in lawn, car repairs in the driveway, leaving garage doors open, or even what you can have in your yard are not allowed. These rules can seem like a lot to some, but they can also be nice if you end up next to a neighbor whose every action lowers property values in the area. When does it make sense to buy? People, who have generally rented their whole lives, purchase a home for various reasons. Owning something of value with a chance of

watching their investment appreciate is one reason. Purchasing a home to save money over the long-term is another.

Example: Let’s say you’re currently renting a two-bedroom, two-bath apartment. Your monthly rent is $1,000. You find a two-bedroom, two-bath at a market price of $250,000 (roughly the national average.) You have $25,000 saved – enough for a 10 percent down payment. For the purpose of this example, you’re looking to finance $225,000, which includes closing costs.

Using one of several mortgage calculators on the Internet, your monthly payment would be approximately $1,385 for a 30-year fixed loan at an APR of 6.20 percent (the national average). After taxes and appreciation in equity, your monthly payment over five years would average $499 per month.

Costs Savings of Buying versus Renting




Monthly rent/estimated mortgage payment $1,000 $1,385
Purchase price of home $250,000
Percentage of down payment 25,000
Length of loan term (years) 30
Interest rate 6.2%
Years you plan to stay in the home 5
Yearly property tax rate 1%
Yearly home value appreciation rate 4%


Price of home after appreciation $304,163
Remaining balance after 5 years 209,887
Equity in house 94,276
Tax savings (28% bracket) 23,030
Avg. monthly payment over time 1,047 499
Total payments (over 5 years) $62,820 $29,973

Total savings if buying

Source: Ginniemae.gov. These calculations are estimates only. You should always seek the guidance of financial or tax experts before making any buying decisions.

The outcome could dramatically change should an unforeseen economic downturn or financial hardship occur (e.g., home improvement costs, catastrophic damage, etc.). While, no one can predict if home appreciation values will spiral downward, or if mortgage interest rates will rise, it’s clear that under the right circumstances home ownership can be financially rewarding. (Provided by informa Research Services).

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In the beginning, I was convinced that renting an apartment was the best way to go, but after doing the research and looking at all the data on the financial side, I found that it is far better to buy a house than it is to rent an apartment.


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