Renting or owning a house is a huge decision for people to make. It can influence how much money they pay each month, the way they live and the size of their nest egg. Now, let’s see what are the advantages and disadvantages of renting and owning a house.

Pros and cons of renting a house


  • Renters will enjoy a great flexibility since they can move out without any penalty if they lease ends or if the landlord decides to sell the house.
  • Renters will get a clear sense of their monthly payment.
  • Renters can move around and relocate easily.


  • Renters cannot build equity with the money they pay each month.
  • Renters may suffer from the unpredictable and immediate increase in rent unless they have rent control.
  • Renters do not need to worry about the maintenance of the house or the projects in the neighborhood.

Pros and cons of owning a house


  • Owners can gain ownership and a sense of achievement
  • Owners can enjoy mortgage interest deduction and reduce their taxable income.
  • Owners can renovate their house.


  • Owners will have unpredictable and additional cost other than their monthly mortgage payment.
  • The value of owners’ house may decrease due to the changes of surrounding environment.

For instance, if a major company moves out the neighborhood or if there is a huge wave of residential construction, the house price will drop significantly.

  • Owners have to deal with the chores and projects around their houses and cooperate with homeowners association.
  • Owners have to take the drawback of their asset’s illiquidity.

Who should rent a house?

  • The one who find owning a house is too expensive.
  • The one whose job need them to travel around.
  • The one who need time to make future plan.

Who should own a house?

  • The one who is out of debt and have an emergency fund.
  • The one who can afford down payment and monthly mortgage payment.
  • The one who are qualified for a good mortgage rate.
  • The one whose rent costs even more than the costs of purchasing a house in long term.
  • The one who intend to stay in their neighborhood for a long time.

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