My dad retired at 55 through flipping houses, but I'm convinced I'll be a renter for life
- I've always rented, and I have no interest in buying a home.
- Renting has allowed me to take advantage of career opportunities and accomplish life goals in ways that I wouldn't be able to as a homeowner.
- I also save a lot of money by renting, and reinvesting that money in the stock market is likely to help me build wealth even better than homeownership would.
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My parents are both homeowners, and my Dad actually owns nearly a dozen properties that he's flipped and now rents out. He managed to retire at age 55 on this hobby.
Yet like many folks in my generation, including a lot of my friends, homeownership has never been a goal of mine.
I've rented everything from studio apartments to four-bedroom homes that I shared with roommates, and in pretty varied locations. I started renting in Eugene, Oregon as a college student, and since then have lived in Portland, Oregon, Savannah, Georgia, Chicago, New York City, and Central America. I'm currently renting a two-bedroom house in a small rainforest town in Costa Rica.
Granted, I live a more mobile lifestyle than most people prefer, and I'm not sure if I'll stay where I'm at now for the long-haul. But even if I did decide to settle down permanently, you wouldn't find me house hunting. Here's why.
I prefer the flexibility of renting
Whereas some people get peace of mind from knowing that the home they're in belongs to them, my peace of mind comes from knowing that I could pick up and leave at a moment's notice if I had to. I know that if I lose my job, if the market tanks, or if one of my parents gets sick, I can simply move without having to wait until my house sells or go through the (often costly and time-consuming) process of subletting.
I also like being able to change up my living situation as my lifestyle changes. I used to live in a small studio apartment, but when I started working from home, I decided to move to a two-bedroom house and convert the second one into an office. If I ever decide I want to boost my savings, an emergency expense comes up, or my partner and I split, I can always downsize again to cut costs.
I'm able to take advantage of opportunities that come up
I can take advantage of opportunities as they present themselves without worrying about bills, whether it's a job offer, further education, or starting a new business. A few years ago, I decided to do a career change and start my own freelancing business. I knew it wouldn't be very profitable in the first year, but I was able to move back home with my family to save money until my business took off.
Renting has also allowed me to cross off bucket list goals. About five years ago, I made the decision to save up money, quit my job, and spend six months traveling around Latin America. First I moved out of my house and started subletting a bedroom in a family's house where rent was 25% lower - all that extra money went toward my trip savings. When I was ready to go, I quit my job and left the US with no bills to worry about.
I save money
Where I live, renting is generally more affordable than buying. In addition to low rent prices, I avoid property taxes, homeowners insurance, and renovations. I live in an area with frequent tropical storms, so I save a lot of money on repairs.
The most valuable way I save money by renting is by freeing up my spare time. In addition to not spending time on repairs and renovations, I don't have to find and manage renters if I decide to leave for a year.
It's also worth mentioning that if I wanted to make a 20% down payment on a house in a major city, I'd probably need about $40,000. Instead, that money will go toward tuition for my master's degree, which stands to produce better returns.
I can invest the money I save for higher returns
Homeownership isn't the only way to build net worth. In fact, by reinvesting the money I save as a renter, I have a good shot at earning even better returns than I would by purchasing a home.
Over the past few decades, stock prices have generally outperformed housing prices. I'm not claiming to know where the stock market or housing market will go in the next few decades, but as someone who's indifferent to the idea of owning a home, this is enough justification for me to avoid homeownership altogether and invest my money in other areas.
Thanks to short-term and vacation rental websites, it's now possible to walk the line between renter and homeowner by renting out your home to tourists. I would consider buying a home one day if I could guarantee the ability to rent it out at a moment's notice, outsource property management, and at least break even. A house might be a valuable asset, but for me, the freedom, flexibility, and time I gain by renting are priceless.
- Read more about renting and buying a home:
- A financial planner says there's a dead giveaway you aren't ready to buy a house, even if you think you are
- Property values in my neighborhood are skyrocketing and friends tell me to 'just buy already,' but here's why I won't
- A financial planner explains why you shouldn't invest the money you're saving to buy a house in the next few years
- Even though I could afford a $2 million home, my house costs a fraction that much because I've embraced a truth most people don't understand
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