Conventional wisdom says that buying a home is a sound investment, and renting is throwing money out the window every month. But finance blogger Millionaire Mommy Next Door says that renting resulted in significant savings over buying a home:
I calculated the total cost of living in our [purchased]home. Due to our sweat equity, our mortgage balance was very low … but once I added property taxes, insurance, maintenance and, especially, lost opportunity costs (home equity not available to earn money), it became very clear that our shelter “need” was costing us too much in life energy.
Of course your situation depends on location, income, credit score, and real estate market, but this is an interesting look at an argument for renting you don’t often hear. Photo by Lil Erna.