Morning Cup O' Joe

Time you enjoy wasting isn't wasted time.

Renting vs. Owning Your Home

 Millionairemommynextdoor Rwstnu8Zfpi Aaaaaaaaaba Depsxfbbpha 11-Men-Mowing[3]
Millionaire Mommy Next Door is a blog by a self-made millionaire sharing “her recipe for success, happiness and a million dollars.”

I found an interesting entry (via Lifehacker) where she argues that renting might make more sense financially than owning a home. I know there are a lot of factors at play here, but I thought I’d throw that out to you, gentle readers, and ask your opinion on this matter.


October 18, 2007 - Posted by | General, How-To


  1. Shooting from the hip

    It depends on the Market…

    Right now, Home Prices a slumping and the market is becoming more and more a buyer’s market. Homes sit and sit and sit while bargain shoppers wait and watch the prices drop. So if you’re unfortunate enough to have bought 5 years ago… sucks to be you if you own an ARM (Adjustable Rate Mortgage).

    Okay, this is where the false sense of security starts to set in.
    I feel fortunate that I got in at the beginning of the down swing. I could have waited a little longer but I felt it was time. I also feel fortunate because of the fact that I live in the San Francisco Bay Area where home prices on the most part are stable.

    Comment by Bernard | October 18, 2007

  2. I played with the calculator a bit and I’d agree that the market makes the biggest difference. I noticed with one set of numbers (550k home, $1350 rent) that at 4.5% appreciation didn’t break even in 30 years, but 4.6% did in 11 years. In SLO we’ve seen pretty reliable appreciation over the last 10 years and even in the current slump it hasn’t fallen off that much.

    Funny though, I was looking in the real estate section of The Bay News this morning. Most houses in the Morro Bay area are $550+, while an Executive Rental in a posh neighborhood was only $2800/mnth. Even the average rentals aren’t anywhere near the cost of a mortgage on a $500+k home if you’ve only got 10% or so to put down.

    One thing that the linked article fails to account for, and I suspect she might address it in another article, is what the mowing, yardwork, remodeling and labor does as a source of pride and pleasure for some of us. Being a knowledge worker and sitting at a desk all day, I appreciate the blisters and work associated with working around the house and physical labor. To each their own, but I would miss the satisfaction and freedom if I went back to renting. But I suppose I would have more money for other things, although more money isn’t exactly high on my priority list.

    Comment by morgan | October 19, 2007

Sorry, the comment form is closed at this time.

%d bloggers like this: