10 Reasons It’s Better to Be a Renter
For decades, it was drilled into the heads of many Americans that renting makes you a second-class citizen. You only rent temporarily until you can move up in the world and achieve the American dream by purchasing a home – but those days may be behind us.
About three in five adults believe renters can be just as successful as homeowners at achieving the American Dream, and more than half believe buying a home has become less appealing in recent years, according to a 2013 survey of more than 1,400 people by research firm Hart Research Associates.
While owning a home may be an aspiration for many Americans, it’s often just less expensive and more convenient to be a renter. Here are 10 examples:
1. You spend less on utilities. You still need to pay for utilities when you rent, but chances are, your utility bills would be higher if you owned a home. First, a larger space uses more energy, so you can expect your heating and cooling costs to increase. You may also have to pay for watering your yard, upkeep of a pool or utility bills that were previously included in your rent, such as water, trash or association fees, if you live in a subdivision or condominium.
3. You don’t have to pay property taxes. Homeowners are required to pay property taxes, which can be passed by counties, cities and even school districts, so exactly how much you would pay depends on where you live. For example, the median property tax in New Jersey is $6,579 per year for a home worth $348,300, while the median property tax in Louisiana is $243 per year for a home worth $135,400, according to Tax-Rates.org. Regardless of the amount, that’s an expense renters avoid completely.
4. You’re likely to have less debt. Between student loans, credit cards and car loans, many Americans are already in debt before introducing a mortgage to the mix. In fact, Debt.org reports that more than 160 million Americans have credit cards, and on average, each household carries more than $15,000 in credit card debt. On top of that, NerdWallet reports that the average household has more than $154,000 in mortgage debt. Take a house out of the equation, and you don’t have to worry about that mortgage debt.
5. Renters insurance is less expensive than homeowners insurance. According to the Insurance Information Institute, the average annual home insurance premium ranges from about $600 in Wisconsin to nearly $2,000 in Florida. On the other hand, the institute says a renters insurancepolicy averages only $187 per year.