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Chapter 8: Problem 21

Describe two advantages of renting over home ownership.

Short Answer

Expert verified
The two advantages of renting over home ownership include financial benefits such as no property taxes, insurance, and maintenance costs, as well as no need for a large upfront investment. Renting also allows more flexibility if life circumstances change as it is much easier to move after the lease is up, and maintenance and repair responsibilities generally lie with the landlord.

Step by step solution

01

Identify Financial Benefits

Renting may offer financial benefits compared to home ownership. Since homeowners have to pay property taxes, insurance, and maintenance costs which renters do not. In addition, renting doesn't require a large upfront investment like a down payment. Often, the monthly rent for a property is less than a mortgage payment would be for a similar property.
02

Consider Mobility and Flexibility Benefits

Renters enjoy more flexibility than homeowners. If life circumstances change such as a job relocation or desire to downsize or upgrade, renters can more easily move after their lease is up without having the hassle of selling a home which can be time-consuming and expensive.
03

Evaluate Maintenance and Repair Aspects

Renters also have fewer responsibilities when it comes to maintenance and repairs. In most cases, the landlord is responsible for maintaining the property, including appliances, and making any necessary repairs. Renters are generally not financially responsible for these.

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