16 Things to Know About Renting or Owning a Home

To rent or to buy? For decades we were told that to finally have reached the American Dream, we need to go to college, get a job with a pension and buy a house. And for many, this dream came true.

In fact, it became such a THING that people started to feel shame or embarrassed because they were renting, lining a landlord’s pocket and never building equity.

Besides a pension, paying off your home was seen as I MADE IT and so can you. Maybe that was true for Baby Boomers, who were beneficiaries of a strong post-war economy. They traded in their crowns of flowers for suits and ties.

But for Generation X, Millennials and Gen Z, it’s an entirely different story. I remember when the stock market crashed in 1987. It was called Black Monday and my boyfriend at the time told me his dad lost a shit ton of money. It was a crazy time. I was 17 and had no clue what this meant because my parents didn’t have money in the stock market.

Fast forward to 2001 and the economy tanked again because of 9/11. And again in 2008 when the housing market crashed. And again in 2020 because of the pandemic. Gen X is old enough to remember all of this. Older Millennials remember 9/11 and may have had parents who lost homes during the housing crisis.

Which brings us to today. It’s 2025 and the housing market is all over the place. Interest rates are around 6.3%. Credit scores matter now more than ever and there’s a housing shortage. Millennials and Gen Z are convinced they’ll never own a home. Call them cynical, but I call them truth-tellers. Generational wealth isn’t the same as it was in the 1950s and 1960s.

My First Home

I was 28 when I bought my first home in 1998. And I had a lot of help because I had no savings and nothing to give. My mother sold the home I grew up in (which she and my dad purchased in 1976 with a VA loan). She gave me and my then-husband the down payment to purchase a home in a North Seattle neighborhood. It was $232,500. It was the house my kids grew up in and I ended up having to sell it to avoid foreclosure in 2020.

I was sad to sell. For so many reasons. I was filled with shame and anger because I hadn’t been able to work out a solution with the mortgage servicer. I was angry at myself for having failed. It was a scary time and even as I was filing for bankruptcy (twice!) I was praying like crazy that THIS TIME things would work out.

Deep down I knew I had to let go.

One night, my mother had been watching the news about Kobe Bryant’s death and she said to me that it just wasn’t worth all the agonizing. Anything can happen to any of us at any time. She told me to let go, that we would be OK. And she said that if we had to sell, then we would sell, and we would be together. It would be fine.

I talked to my kids who were 19, 15 and 14. They all wholeheartedly supported me. In fact, they were very practical about the whole thing. “Ma, if you don’t sell, you don’t get any money. If you sell, you get some money. Take the money.”

I ended up walking away with some cash. Not as much as I wanted, but I was lucky to not lose the house and any equity.

Renting Changed My Mind About Renting

Because of my terrible credit and of course, the pending foreclosure, no one was going to give me a mortgage. We had to rent and I had to come up with $10,000 for the first and last month’s rent, plus the deposit. My mother came to the rescue and lent me the money. I was lucky to find a place big enough for all of us. And when I say all of us, I’m including cats, a dog and four chickens!

We’re still living in the same house (that’s just over five years now) and we feel blessed to have had such amazing landlords. And in we live in a nice neighborhood, close to the bus, the train, parks, grocery stores and for my mother and sister, the local Goodwill! Our landlords are responsive and kind, and haven’t raised the rent in all this time.

Once I got used to the fact that I was renting a home in my 50s, I realized three things right away. First, I was sleeping through the night. Second, I stopped having anxiety attacks. Third, I wasn’t responsible for repairs. And finally, I don’t know if it was getting good with my money or not having to worry about maintaining a home, but my savings rate went through the roof! I started contributing (almost maxing out) my Roth IRA and became intentional about my savings goals.

It was evident that first night in the new house. I slept on the couch because my bed hadn’t arrived yet. It was quiet but I could hear birds chirping in the trees in the backyard. The azaleas outside what would become my bedroom window were starting to bloom.

I felt so much at peace.

It’s been five years and only now am I starting to think about perhaps buying again. And the only reason is because my mother and sister have aged and need an accessible bathroom. I can’t afford the rent anywhere else because rents are high. The boys, now 21 and 20, are talking about wanting to move out. Maria moved out in 2021. There wouldn’t be any point having a five-bedroom home for just me, my mother and my sister.

I’m not sure what’s next, but after five years of saving, investing and getting good with my money, I have a better sense of what it’s like to own (and the responsibilities that come with that) and what it’s like to rent (and the freedom it provides).

Rent or Buy? 16 Things To Think About

1. Repairs. When the roof leaks or the furnace goes out, you’re responsible for the repairs. In the 23 years that I owned my home, I had to twice replace the gas furnace.
2. Maintenance. Yard work, tree trimming, leaky faucets, leaky basements, new paint job inside and out. This is all yours when you own.
3. Neighborhood. Love your neighborhood? Then you probably don’t want to move.
4. Economic uncertainty. If you’re not prepared with an emergency fund, you could be in danger of losing your home. This happened to me.
5. Variable interest. If you have a variable interest rate on your mortgage, you could end up paying more at certain times throughout the years, which could screw up your budget. These interest rates change when interest rates rise and fall.
6. Property ownership. You can own property through other methods, like real estate trusts.
7. Stability. If you have a fixed interest rate on your mortgage, then you know what to expect each month.
8. HELOCs. If you want to make major changes to your home, or you want to pay off debt, you can use your home as collateral by getting a Home Equity Line of Credit. The benefit is that you have cash to make those remodels and the interest rate is typically lower than charging the bills to credit cards. And using a HELOC to pay off high-interest debt saves you money in interest. BUT if you can’t pay off the HELOC (and you rack up debt again), you could put yourself in danger of losing your home.
9. Renting. Freedom of movement. If you decide to live in another city or state, it’s easy enough to give notice and move.
10. High rent. Unless you live in a rent-controlled area, your landlord can raise your rent, sometimes so much that you can’t afford to live in the rented home.
11. First/last/deposit. Renting means that whenever you move, you need to come up with a few thousand dollars for your next place.
12. Credit. You gotta have good credit to apply for a mortgage and to rent.
13. Down payment. To avoid paying for PMI (Private Mortgage Insurance) you need to put 20 percent down on a house. The average price of a home in Seattle is $879,412, according to Zillow. Twenty percent is $175,882.
14. A rent payment is not always the same as a mortgage payment. Just because I can pay $2900 in rent each month doesn’t mean I can afford a house with a $2900 mortgage. There are additional costs like insurance, taxes, maintenance and repairs to consider.
15. Vacation rental. Your rental could end up being turned into a vacation rental (like an Airbnb), which would put you at risk of losing your rented home.
16. Changes. In a home you own, you can remodel however you want. In a rental, you obviously can’t do that.

This list is one way to get your ideas flowing and to investigate more so you can make the best choice for your particular financial situation. One way to figure out if you want to buy a home or rent is to attend homebuying counseling. Check out the HUD website for a directory of agencies in your area that offer counseling.

Your state’s department of housing or financial institutions (in Washington it’s called the Washington State Housing Finance Commission) will have information on homebuying, DPAs (Down Payment Assistance Programs), property management, investing in property and so much more. They’ll also connect you with homebuyer education classes for first=time homebuyers.