I have never received a financial benefit of any kind from renting anything.
The financial benefit to the renter is the costs you may have incurred had you owned, which you can't really quantify. Maybe you missed out on having to pay $10k+ for home repairs by renting instead of buying. Or maybe the city would have assessed you your share of the cost of redoing your road had you bought. Maybe you would have paid $5k to upgrade a few fully functional things for cosmetic reasons. In all of those cases, renting, though the rent payment may be higher than the equivalent mortgage payment, could save you money. If you buy a house and stay there for 10+ years, those expenses average out to likely being less than what it would have cost to rent. If you're moving around every few years, if you're unlucky and have those major type of expenses, plus the cost of moving can easily become more expensive than renting.
That's a lot of "maybes"
Here's what I
know based on my own personal experience with renting versus owning. We rented a 2-bedroom apartment for many years. When we first moved in the rent was $900/month or $10,800/year. We lived in that apartment for about 5 years and the rent when up by $100 a month each year. So rent went like this:
Year 1: $900/month = $10,800/year
Year 2: $1,000/month = $12,000/year
Year 3: $1,100/month = $13,200/year
Year 4: $1,200/month = $14,400/year
Year 5: $1,300/month = $15,600/year
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Total:-------------------=
$66,200 rent paid over 5 years
My return on that $66,200 paid in rent = $0.00 - I paid the rent. I traded dollars for the ability to occupy a space in someone else's building for a predetermined period of time. Those rent payments entitled me to nothing other than the ability to legally occupy that space for the agreed to period of time. Once that period of time ended, I had to remove myself and my property from that space.
Compare that to the finances of owning our first home:
Mortgage payment: $1,098/month but we paid $1,500/month to pay down extra on the principle of the loan. When we had been there for 5 years we refinanced the mortgage for a lower interest rate, but our payments were $1,500/month for 5 years:
Year 1: $1,500/month = $18,000/year
Year 2: $1,500/month = $18,000/year
Year 3: $1,500/month = $18,000/year
Year 4: $1,500/month = $18,000/year
Year 5: $1,500/month = $18,000/year
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Total:--------------------- $90,000 mortgage payments over 5 yearsRemember, I said our actual mortgage payment was $1,098/month but we paid $1,500 so every month we paid $402 on the principle or $4,824/year so over the first 5 years of the mortgage we paid $24,120 of extra principle, which increased our equity in the property by...$24,120
Between our $30,000 down payment when we bought the home, the $24,120 in extra principle we paid on the loan and the march of time, after living in the home for 5 years its appraised value went from $172,900 (original purchase price) to $197,900 (appraised value at the time we refinanced) which is a $25,000 appreciation in our investment. So, that left us with about $49,120 in equity.
In 5 years until we refinanced we did about $15,000 in maintenance and repairs, mostly spent on a new roof, new furnace and paving the driveway.
$49,120 - equity
- $15,000 - maintenance
------------------
$34,120
So to review, after 5 years of renting an apartment, when we moved out we got our security deposit back: $900
After 5 years of living in our first home, paying the mortgage and paying for regular maintenance and repairs and such: $34,120 in equity. Cash value.
And 5 years later that $34k in equity had ballooned up to $77k while the remaining balance on the mortgage was under $100k. We paid off that mortgage and used that $77k in equity for the down payment on the home we're in now - our "forever home" and we've now been there for almost 8 years and that $77k in equity we got by making that initial down payment has grown to over $200k in equity today.
If you want to rent, by all means, rent. It's a free country but there is no denying that in most cases owning a home is far more financially beneficial than renting. You can pay someone else's mortgage or you can pay your own. We choose to pay our own.
Here's a fun fact:
The exact same 2-bedroom/1-bathroom apartment I am referring to above now costs $2,300/month to rent. That's almost $400/month more than my current mortgage payment.