Will Home Ownership Really Make You Happy?

by Miranda Marquit · 8 comments

My husband and I are contemplating the possibility of moving. We’re not sure yet how everything will play out (we’re waiting to see if he got a job he recently applied for), but we’ve talked a little bit about what our housing situation might look like.

One of the things we’ve decided is that we might not care all that much about buying another home. We might be good with renting. While we’ve enjoyed living in our home, the thought of trying to sell it is stressful. We wonder if we might have enjoyed living in a nice rental just as much.

Could Renters Be as Happy as Buyers?

In a study titled, “The American Dream or the American Delusion? The Private and External Benefits of Homeownership for Women,” a professor at the Wharton School at the University of Pennsylvania examined the happiness levels of women renting vs. owning.

The results of the study surprised me, but when I really think about it, they make a great deal of sense. The study indicates that those who own their homes aren’t any happier than those who rent. One of the biggest takeaways of the study was that homeowners spend less time on leisure activities than renters.

The Perks of Renting

When you think about some of the realities of homeownership — maintenance, repairs, property taxes, and other costs and tasks that take up time — you can see how homeowners might have less leisure time.

On top of that, homeowners that insist on larger houses might have less disposable income overall. If you’re spending money on costs related to your large house, how much will you have left over for activities that add to your quality of life?

We’ve been fortunate in that our home is relatively inexpensive as it relates to our income. We live in a modest house, with a modest monthly payment. Our utilities, taxes, and other costs are low. We bought a new house, so repairs aren’t an issue yet. Maintenance hasn’t been too bad. As a result, we haven’t experienced a lot of the “pain” mentioned in the study.

However, I can see how selling is going to be a nightmare. If we were in a rental, all we’d have to do is wait for the lease to be up and then move. It’s a lot easier than dealing with the mess of selling.

When considering renting, I’ve been thinking about a nice apartment (we could get something about the size of our home) in a building with a fitness center and pool. I’ve also thought about the experiences that I could enjoy if the building were close to shopping and dining.

In the end, it’s more about your personal preferences and your quality of life. If you have a nice big house that serves as a status symbol, it might provide some satisfaction to you. However, can you really be happy in the long run if you’re house rich but cash poor, with little disposable income?

What do you think? Rent or buy?

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  • Chloe Slone says:

    I agree with Christopher Quinn, that owning your own home has far heavier financial responsibilities than renting does. The expenses associated with homeownership can become quite burdensome, so those owning homes aren’t likely to be happier than those renting. Fixer uppers can be too costly for many folks, but renting can be a let down too. As Slinky mentioned, there are rewards of owning, such as having more power over your life and purchasing pets, etc.

    You have to decide what works for you, but being a modular home owner myself–it is extremely expensive as more and more time goes by.

  • Slinky says:

    I always hated renting. I really love owning a house, despite the increased maintenance and costs that came along with my fixer upper. There are no neighbors slamming the doors at all hours or ringing every apartment buzzer at 4am because they are drunk and lost their keys. No one leaves their laundry in the washer or dryer and I no longer have to collect “laundry tokens” (quarters) to do my wash. I’m busy painting everything and have plans to do some paint stripping. We planted a garden and have fruit trees. I can have whatever pets I want or watch a friend’s dog while they are on vacation. No one looks at me weird when I sit in the backyard. (Why is that so weird, seriously?) We can throw parties and have bonfires until 2am and no one cares. I have trees that are perfect for a hammock.

    On the other hand, we’ve demolished and rebuilt our entire living room ceiling when we discovered the condition of our floor joists not long before we were set to move in, stripped wallpaper, repaired walls, painted half the house and have a seriously ridiculous list of projects that need doing. The dryer needed to be replaced. The dishwasher is probably going too. And I really need to finish doing something about the “weed garden” in the front.

    And yet…..somehow that first list always makes up for the second. Buying a fixer upper has been more like acquiring a fun new hobby for us. And when we look at the original pictures, it truly is amazing what we’ve accomplished in only 9 months.

    Just don’t be stupid and stretch your budget to make it work.

  • hannah says:

    As someone who’s always rented, I have to say home ownership wins out. I agree that home ownership costs more money and more time.
    But what does renting give you? The freedom from a large mortgage. And that’s about it.
    When you rent:
    – your place isn’t your own, most places won’t let you paint, replace flooring or lighting
    – forget about upgrades and you better get used to worn out appliances and outdated wiring
    – depend on a constantly increasing lease
    – if something breaks down, the landlord might be on the hook for it, but you have to deal with the hassle o getting him to fix it correctly, the first time
    and etc.

    Overall I want nothing more than to be a homeowner. Let the money we waste on rent go toward paying a mortgage on a modest house. That will eventually lead to being free – free of a mortgage, and free of monthly payments – which never end when you are renting.
    I also look forward to upgrading to decent appliances, and being able to have a wall painted something other than gray or beige. And lets not forget being able to escape the annoying ‘ they parked in my designated spot yet again’.

  • fredjohnson says:

    It was tough for me being a renter. I never felt like I had control of anything in the place I lived. No permanent changes allowed to the place, rents went up after each lease ended, my places were always too small, and for some reason renting always attracts undesirable neighbors. I bought a condo and lived in it for 5 years. Finally got the “control” back in my life but all the other negative things about renting still applied. Finally, I saved up $100k and put 20% down on a $500k newly built house in the suburbs. I do love it here. 1 acre lot in the woods, 4000 sf walkout rambler, 3 car garage, no more cardboard thin walls that you can hear everything through, no common mailbox or entry way, no crammed parking lot parking. The landscaping is the way “I” want it to look like, not the way some careless owner does. Yes, it costs more to own. $3000 a month mortgage payments(15 yr loan) and $6800 a year in property taxes. I am much more happy owning at this point than I ever was renting. But, as you can see, there is a cost to that. However, I have much more control now over my living quarters, and that’s worth it to me. And in my neighborhood now, there are no bad neighbors, because rally “bad” neighbors can’t afford to live in my area. If you are unsure whether to keep renting or to buy, then do what I did. Buy a place that is small, inexpensive and that you can very easily afford. Live there for awhile and see what you think. It may be the last place you ever need to live in. Or, you may decide to save some cash and move up to a bigger, better place. Remember—when I’m done paying the mortgage—in 5 years—you will still be shelling out lots of cash to rent. I’ll only have prop taxes and maintenance and those are lots less that renting. Plus, your rents will keep going up as time marches on. In the end you have no asset, no equity and I’ve got a $500k plus house that’s paid for and will keep going up in value. There’s lot’s of things to think about with housing. It helps to think long term in this area.

  • PurpleLisa says:

    As a longtime renter and now a homeowner, I can say with certainty that I prefer homeownership, despite its costs and hassles.

    Renting works well only if you have a landlord who is fair and reasonable and who is willing to keep the place maintained. Any other kind of landlord has the potential to make your renting life miserable. Landlords have a lot of power that goes along with their ownership, simply because they are the owners and despite the fact that you, the renter, pays out good (and sometimes a lot of) money for the rent. They can place all kinds of limitations on you or choose not to renew your lease or hike the rent every year or not do the proper maintenance or show up unannounced at your door for all kinds of reasons, in all cases doing their best to pass their costs of ownership to you.

    Owning your own home eliminates the landlord’s potential to do all these things completely. All you have to do is figure out how to make the mortgage payment and keep the place maintained well enough so it doesn’t fall down around you. You can make the maintenance as a time-consuming as you want, depending on your preference. I still have a lot of time for leisure activities and for travel, despite being a homeowner.

    I had several good landlords, mind you, but then I had one particularly awful one, and that was enough to convince me to become a homeowner.

    The equity I’m building in my home is just a bonus for the tremendous sense of emotional freedom I have now as a homeowner.

  • The Cruise Lady says:

    Even though, as a renter, our landlord is responsible for repairs, we can’t really make the place our own. Yes, he allowed us to paint the walls a different color,
    but to knock out a wall, expand the kitchen, remove the useless “storage” shelving in the garage, no. Maintenance is at a minimum, no upgrades.

    We are making his house payments for him. He benefits from tax write-offs, and equity building up. In our area, sales are booming, and the value of the unit has almost doubled in the past two years.

    We are at his whim for rent increases, rules on parking our car, what we can and can’t plant in the yard, if we can have a pet, how many pets ( 1 ), how many people ( 3 ) we can have in a 4 bedroom unit, etc.

    We are now negotiating to buy a place of our own.

  • Christopher Quinn says:

    Owning a home comes with much more financial responsibility and can be a huge financial burden if you find yourself underwater like so many folks seem to be these days. As an owner of one home (that I rent out) and a renter of an apartment closer to my work I find the unit I rent to be much more “hassle free”. Not to forget my home that I rent out is a negative cash-flow situation which is something I need to contend with every month.

    If you can get a decent ROI I would say buy; but, if there seems to be a questionable ROI for your time and money when making a decision to purchase a home I would stick to renting.

    Chris

  • Meghan says:

    Costs being equal, buy, if you know that you’re not moving and are set on a certain part of town.

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