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Renting vs. Buying a House

To buy or to rent, that’s the question. Buying a home potentially has long-term benefits. These include possibly seeing it increase in value over time, which could give you a sizeable return on your investment if you decide to sell it in the future. But unlike renting a home, buying means you’re responsible for maintenance and repair expenses instead of the landlord. And that means it’s important to understand, and budget for those costs.

Here’s a look at some of the key differences in costs.

Explore the differences in costs


  • Down payment
  • Closing costs


  • Security deposit (usually at least one month’s rent)
  • Pet fees (if you have a pet)


Homeowners insurance covers specific aspects of your property, as well as the belongings you keep in your home. It also may help protect you financially if a person is injured on your property.

Private mortgage insurance, which you may be required to get depending on the type of mortgage you get or your down payment amount, is designed to reimburse your mortgage lender if you stop making payments on the home.

Both of these items may be rolled into your monthly mortgage payment so you don’t have to worry about making separate payments for them.


Renters insurance typically covers the value of items in your residence in case of theft or damage.


You’ll likely pay directly for utilities including water, sewer, and electricity, plus any fuel for heating systems.


Many landlords cover at least some utilities costs, such as water and sewer. The information on your specific rental should be detailed in the lease.


For a single-family home, you’re responsible for maintenance expenses, such as fixing a leaky roof or replacing a faulty HVAC system. Condos and townhouses have some maintenance covered with homeowners association dues.


Your landlord should cover significant repairs and upkeep of the structure.


You’ll pay property taxes based on the appraised value of your home. These may be part of your monthly mortgage payment if you have escrow, which is when you pay a certain amount each month to your mortgage company and then they hold onto that money and use it to pay your homeowners insurance and property taxes.

Mortgage interest or property taxes in some cases could be tax-deductible. Learn more about the tax benefits of homeownership.


You’ll pay no property tax directly. But the costs of property taxes are included within the overall cost of rent. In some states, renters may qualify for a tax deduction or refundable credit when filing tax returns.

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