It seemed like the word “renting” was almost a bad word when I first started out writing articles about the benefits of such a living situation back in 2007 and 2008. Once the housing market imploded though, I didn’t receive such strange stares from people when I told them I preferred renting over homeownership.
Bankrate.com notes that, “According to the U.S. Census Bureau, the seasonally adjusted national homeownership rate stood at 65.3 percent in the fourth quarter of 2012. That was a big dip compared with the peak of 69.4 percent in 2004 but comparable to the 65.4 percent rate way back at the beginning of 1996.”
Having lived in six different apartment locations over the years, I’ve picked up some essential information that has helped us cut costs during our time as renters.
Finding an apartment location with the right amenities can add hundreds of dollars a month in value to a living location. From free parking, and utilities like heat, trash, water/sewer, and cable, to swimming pools, basketball and tennis courts, workout facilities, walking trails, fireplaces, laundry facilities, business centers, and more, there are numerous options when it comes to the free amenities that could be available with a particular apartment or apartment community.
Not only can such offerings cut regular expenses, but they can help lower entertainment costs by offering opportunities that an apartment dweller might have paid for otherwise such as a gym membership, parking permits, and similar costs.
Beyond what is offered in the apartment community itself, amenities in the immediate vicinity and surrounding area could add significant value to an apartment. According to an article on lifehacker.com, “Each mile you live from work costs $795 in commuting expenses per year (assuming a driving cost of 34 cents per mile and factoring time lost with a salary of $25 per hour).”
This just goes to show how pricey driving to work or area amenities like the grocery store, schools, post office, library, bank, and more can be over the course of time. Therefore, considering just how conveniently located things like these are, as well as the potential for commuter rail or other public transportation options, can add significantly to the overall value of renting an apartment in the right location.
Maybe one of the greatest factors to consider when deciding whether or where to rent is that of bundled costs.
When living in a house, there can be costs related to property taxes, mortgage interest, maintenance and repairs, mortgage insurance, and a litany of other expenses that may not be factored in to the initial purchase price of the home. Much of the guesswork that’s involved in determining just how much the average home-related expenditure will be may disappear when renting an apartment since all those various costs are bundled into a monthly rent amount.
An $800 a month apartment can be easier to budget for, since renter’s insurance and utilities might only drive up the overall cost of such a living arrangement by several hundred dollars a month. Meanwhile, when buying a home for $200,000, while the monthly payments may only be $800 a month (depending upon the type of mortgage and associated rates), all those other aforementioned costs could more than double that monthly amount.
Therefore, it’s important to consider such things before deciding upon a living situation. Considering these types of factors helped us save significantly over the nearly decade-long period that we were apartment dwellers.
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The author is not a licensed financial or real estate professional. This article is for informational purposes only and does not constitute advice of any kind. Calculations have not been verified by a professional. Any action taken by the reader due to the information provided in this article is solely at the reader’s discretion.