Who Knew Renting Was So Difficult And Expensive?

My wife and I are in the awkward position of needing to find a place to stay for just a few months after we sell our current home but before our new house is finished being built.

So, we decided to go apartment shopping. However, we’ve owned houses for the last 5 years and have been out of the rental market.

We were shocked by a few things in the rental search that I never anticipated would be problems.

Rentals Are In High Demand

I didn’t expect to have problems finding an apartment to rent. I always figured there were plenty of available apartments as long as we started looking at least a month ahead of time. I was so wrong.

All of the cheaper but decent looking apartments all had waiting lists that were two to four months out. Who starts looking for an apartment four months before they need it?

We didn’t need anything fancy, but we didn’t want to live in the cheapest apartment we could find, either. Our apartment hunt was off to a frustrating start.

No One Rents For Less Than 7 Months

After we found out that our selection would be limited, we started asking questions about short term leases. We only need a rental for a few months, maybe six months at the most.

We figured it’d be best for us to find an apartment complex that would allow us to sign a month to month lease. Sadly, we discovered that not a single apartment complex we talked to offered anything less than a 7 month lease.

After further thought, it makes sense no one wants to lease month to month. Landlords risk their property and someone looking to rent month to month may not have the best intentions.

Additionally, the staff has to go through a massive amount of work to get the paperwork signed and to prepare the apartment for the next tenant. Just a couple months of rent doesn’t cover all of that additional work and cost.

Renting Is More Expensive Than We Thought

So after we found out that finding an apartment would be difficult and that we couldn’t get a short term lease, we figured that apartments were probably going to be more expensive than we thought. We were right.

Just to get an idea of what we’re used to for our housing costs, here is a breakdown of our current home.

The house we’re selling is in a cookie cutter neighborhood, has 3 bedrooms, 2 bathrooms, a 2 car garage and is about 1,850 square feet. Between our mortgage, insurance, taxes and HOAs, we pay about $1,000 per month for our home.

Of course, we have to pay for other things as a home owner, such as maintenance and repairs. Even with those additional costs, owning is much cheaper than renting where I live. Here’s why.

The apartment we’ll be renting costs almost $1,150 per month. The thing is, it’s one of the least desirable apartments in the neighborhood since it faces the parking lot.

The apartment is just under 1,100 square feet and only has 2 bedrooms and 2 bathrooms. There is no garage, but we could pay $100 per month for a single car garage if we wanted one.

Granted, we won’t have to pay for any maintenance, but the cost difference is huge! We’ll be paying more for a smaller apartment with no garage than we pay for a much larger single family home with a 2 car garage in a nice neighborhood.

Renting Is Short Term For Us

We don’t mind paying more to rent because we need the flexibility renting provides in the short term. However, owning a home is definitely the way to go if you don’t need the flexibility and have a strong financial foundation. At least it is where I live.

What do you think about the crazy costs of renting versus buying in my area? Are you surprised about the cost differences?

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About Lance Cothern

Lance Cothern, a Certified Public Accountant (CPA) licensed in the Commonwealth of Virginia, is the founder of Money Manifesto. You can read more about him here or connect with him on Facebook, Twitter, Google+ or Pinterest.

Comments

  1. We ran into similar challenges a couple of years ago. We were moving (downsizing actually, in the same area) and our house sold much faster than expected. We needed a place to rent for two months and it was a challenge. Once we did find an option (“executive” rental – furnished and short-term) it was expensive. Much cheaper than a hotel for a couple of months though. 🙂

  2. Have you looked at subletting? I have had good luck doing that when I’ve been in between apartments, or when I’ve needed summer housing!

    • We did, but there isn’t much available here and the fact that we have a dog made it more complicated. We did get lucky and find a place that has a clause that allows us to break the lease for a reduced fee is we are buying or building a home, though.

  3. This is the absolute truth in the Denver area. I see so many PF bloggers say “Don’t buy!” if you have debt, but out here, the pros outweigh the cons. You get a newer house for around the same price, if not less, than a monthly rent, and you get the two-car garage and fenced in yard.

    I love that you shared this because I think many bloggers have sheep’s wool pulled over their eyes when it comes to renting vs. buying.

    • The thing is real estate is always a very local decision. Buying is definitely better in many markets assuming you’re ready for the responsibility.

    • Absolutely agree about the Denver housing market, now one of if not THE most competitive and low-inventoried markets in the US. I’d been resisting buying a home here for 2 years due to inflation, but when you look at the cost of rent (especially renting a house), it’s cheaper to have a $330k mortgage.

      $1500-2200 to rent vs. $1700-1900 for a mortgage in a market that will likely not depreciate anytime soon…it’s painful but a no-brainer if you’re in a position to buy.

      Plus renting (in most cases) is only the illusion of convenience. You cannot lease for less than 6 months, short-term rents come at a higher premium, and there are massive penalties if you have to break your lease. Unless you are in between selling a home and building a home, in a transient situation, or simply cannot afford a down payment for a home, renting is a money pit.

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