Should I Rent or Should I Buy? A Practical, Financially Smart Guide for Today’s Market
Written by Elliott Grand with SHP Companies
(Largest cash buyers in South Louisiana)
elliott@shpcompanies.com
225-242-9646
“Should I rent or buy?” is one of the most common financial questions people face—especially in high-growth cities, changing job markets, and a world where lifestyle flexibility matters more than ever.
There is no blanket answer for everyone.
It depends on your age, career goals, lifestyle, financial discipline, and the trajectory of your city.
This guide breaks down the real math, the hidden costs of owning, the benefits of renting, and the criteria that make buying the right (or wrong) decision.
- Renting Is NOT Always “Throwing Money Away”
This is one of the biggest myths in personal finance.
Renting can actually be:
- Cheaper
- Lower risk
- More flexible
- Better for careers
- Better for young people or people changing cities
You aren’t “throwing money away” when you rent.
You’re paying for:
- Flexibility
- Mobility
- Convenience
- Low responsibility
- No repair bills
- No surprise maintenance costs
- No homeownership stress
And financially, renters avoid:
- Property taxes
- Home insurance
- Closing costs
- HOA fees
- Large down payments
- Repairs
- Landscaping
- Replacements (roof, plumbing, AC, appliances)
- Interest expenses
In many cases, especially in expensive cities, renting can be the more financially efficient decision.
- The Hidden Costs of Homeownership (What People Forget to Mention)
When you buy a home, you’re not just paying the mortgage. The real cost includes:
Ongoing Costs
- Property taxes
- Homeowners insurance
- HOA fees (if applicable)
- Lawn care
- Pest control
- Higher utility bills
- Maintenance and repairs
- Appliance replacements
Long-Term Repairs
Homeowners eventually pay for:
- Roof replacement
- HVAC replacement
- Water heaters
- Plumbing issues
- Foundation repairs
- Flooring replacement
- Exterior paint
- Landscaping and tree work
These can total $3,000–$15,000 per year depending on the age and size of the home.
Transaction Costs
Buying and selling also comes with:
- Closing costs
- Commissions
- Appraisal fees
- Loan origination fees
- Title fees
When you add everything up, homeownership is far more expensive than the mortgage payment suggests.
- City Growth Matters: High-Growth = More Appreciation Potential
One of the biggest drivers of whether buying makes sense is the growth rate of your city.
High-growth markets:
- Strong population growth
- New jobs
- Expanding infrastructure
- In-migration from other states
- Limited housing supply
These cities often see:
- Higher home price appreciation
- Faster rent increases
- Stronger resale values
- Higher demand for housing
Buying in these cities can be a powerful long-term wealth strategy.
Low-growth or shrinking markets:
- Declining population
- Weak economic base
- Few job opportunities
- High crime or declining quality of life
These cities often see:
- Flat or declining home prices
- Slow appreciation
- Difficult resale
- Less rental demand
Buying here may not make financial sense.
- Age, Career, and Lifestyle Should Guide Your Decision
Younger adults (20s to early 30s):
- Careers often change
- Cities change
- Relationships change
- Income is still growing
- Flexibility is valuable
Renting usually makes more sense.
People in stable careers (mid-30s and older):
- Stable income
- Established in a city
- Long-term lifestyle decisions
- Children or consistent routines
Buying becomes more appealing.
People with flexible or mobile careers:
Remote job? Tech? Consulting? Sales?
If you may relocate, renting is smart.
People who value freedom and convenience:
Renting reduces stress and responsibility.
People who prioritize control, privacy, or customizing a home:
Buying fits that lifestyle better.
- Our Financial Recommendation: Only Buy If You Can Meet These Criteria
To protect your finances long-term, we recommend:
✔ Only buy if you can put at least 20% down
This helps you:
- Avoid PMI
- Lower monthly payments
- Reduce risk
- Build instant equity
Buying with 3–5% down is extremely risky in today’s volatile market.
✔ Only buy using a 20-year amortization mortgage
30-year mortgages have:
- Very slow principal paydown
- Mostly interest for the first 8–10 years
- Higher long-term costs
A 20-year loan:
- Pays down principal MUCH faster
- Builds equity sooner
- Saves tens of thousands in interest
If you can’t afford the 20-year payment, you can’t comfortably afford the house.
✔ Do NOT spend more than 25%–30% of your gross monthly income
This applies to:
- Rent
- Mortgage
- Taxes
- Insurance
- HOA (if applicable)
Going above 30% leads to:
- Financial stress
- No savings
- No investment money
- Debt
- Lifestyle compromise
Be unapologetically disciplined here.
✔ If you can’t afford the home you want, be frugal for a while
There is NO shame in:
- Having roommates
- Living with family temporarily
- Renting something modest
- Saving aggressively
- Building a strong financial foundation
Too many people buy too early and struggle for years.
Financial safety > social expectations.
- Renting Is Smart Until You’re Truly Ready To Buy
The financially wise path is:
- Rent until stable.
- Save aggressively.
- Build a proper down payment.
- Buy a home when you’re financially and emotionally ready.
Buying is not a race, and rushing into it can set you back years.
- So Should You Rent or Buy? The Clear Summary
Rent if:
- You’re early in your career
- You might change cities
- You value flexibility
- You can’t put 20% down
- You can’t afford the 20-year payment
- Your city isn’t appreciating quickly
Buy if:
- You’re financially stable
- You plan to stay for 5+ years
- Your city is growing
- You can put 20% down
- You can handle a 20-year mortgage
- Ownership fits your lifestyle goals
Final Thoughts: Be Wise, Not Impulsive
Housing is emotional—but your decision should be based on math, stability, and long-term planning.
Be frugal.
Be patient.
Be intentional.
Be financially disciplined—even if it means delaying gratification for a few years.
You’ll end up wealthier, less stressed, and far better positioned for long-term success.
Written by Elliott Grand with SHP Companies
(Largest cash buyers in South Louisiana)
elliott@shpcompanies.com
225-242-9646