4 Times You Should Rent Instead of Buying a Home

"Renting is throwing money away!" "When you rent, you're just paying your landlord's mortgage!" "Buying a house is the best investment!" Have you heard any of these sentiments before? I sure have. I've spent the bulk of my adult life as a renter (and most of my childhood, too, now that I think about it). And I'm here to tell you that there's nothing wrong with renting a home rather than owning one.

Renting actually comes with some pretty good perks. Perhaps the biggest is the cost difference between renting and owning. As research from The Ascent found, in 2019, homeowners paid an average of $8,609 more than renters did. That's definitely not a small amount of money, and surely would have made a nice addition to, say, an IRA account.

That said, I'm preparing to jump back onto the property ladder after renting for more than 10 years straight (and bouncing from state to state, and rental to rental). It has only been recently that I could even conceive of getting a mortgage loan and becoming a homeowner again, due to the circumstances of my life, my job, and my finances. Here are a few circumstances (including my own) under which you are absolutely better off renting.

1. You're still in school

I was broke as a joke when I was a student, so I can't really imagine the circumstances under which you might be able to afford to buy a home if you're still in school. But if you think you can afford it, you should still think twice. Why? You're in the process of figuring things out, and if you haven't even graduated yet, you might not know where a future career will take you. In short, you have your entire life ahead of you, so why tie yourself down with a mortgage now? Take some time to evaluate your options after you graduate.

2. Your career requires you to relocate

This was me for all of my last career. I worked in a competitive field with far more qualified (and overqualified) jobseekers than jobs, and as a result, I criss-crossed the eastern half of the U.S. a few times in pursuit of paying work. I owned a home for a few years very early in that career, and it was a huge mistake for a few reasons.

The first was that I had no reason to live in that city beyond my job, and when I was laid off two years after moving into the house, I also had little hope of getting another job in my field that was in the same area. If you are in a career that has you constantly moving, don't buy a home. Rent, and be glad for the flexibility.

3. You live paycheck to paycheck

This was the other reason I shouldn't have bought my first house. After years of poverty when I was a college and graduate student, I was enjoying my salary and not putting any of it away. Thankfully, I was able to handle all my bills, but I never had much left over between paychecks.

When it came to getting a mortgage, I saw only the monthly costs involved (mortgage principal, interest, homeowners insurance, taxes) and not the big picture. I assumed that since my housing payment was only going to be a little more than my rent had been, sure, I could afford a house! Spoiler alert: I could not afford a house. And when I was laid off, I had no emergency fund to tap to cover my costs. I ended up having to convince my lender to short sell the house, and it put a big dent in my credit score and gave me many sleepless nights along the way.

If this is you, you can't afford a house. I don't care if your friends who own their house pay less on their mortgage loan than you do in rent every month. You're not seeing their total costs, which include repairs and maintenance. They don't have a landlord to call if the kitchen sink leaks. You do.

4. You don't want the extra costs/responsibilities of owning

What if you don't want to take on those extra expenses and truly don't feel like scheduling repair services when your hot water heater breaks or your air conditioner dies on the hottest day of summer? I've got a solution for you: Keep renting!

While I admit that the potential costs of home maintenance and repairs give me pause (to the point that I'm already dreaming of my emergency home maintenance fund), I'm ready to buy a home and start building equity. Meanwhile, I have a colleague who owns her home, but dreams of going back to renting. Obviously, the grass is always greener. But if you don't want to wrangle with all those tasks that become your responsibility if you own a house (or pay someone else to handle them), renting is probably a better bet for you.

Say it with me again: Renting is not throwing money away. You're paying for a roof over your head and saving money in the process. Don't let anyone tell you renting is inferior, because if you're in one of the scenarios above, it's likely the better move for you.