Note: This is a post from Adam Baker, founder of Man Vs. Debt.

Back in February, I caused a little bit of a stir with the following comment on the Facebook page :

If I had a dollar, for every email I got from someone whom DEEPLY REGRETTED buying a house, I would never have to work again. Just rent, people. Itll be o.k.

I got called everything from pretentious to a genius. And you know what? Thats OK.

If youve made a decision about your housing situation, youre happy with it, AND you have the life you want then stop reading here. Go on, you.

But if youre not sure whether to rent or buy if youre doing one or the other but are desperately unhappy with your choice or if youre in what you think is a good housing situation, but the rest of your financial life isnt making you happy then read on.

Heres the not-so-secret secret: There is no one-size-fits-all answer.

Ive heard from people both on that Facebook post and in countless emails who made home ownership work out well. Ive heard from just as many who bought their homes but would give anything to be renting. And Ive heard from plenty of lifelong renters who are thrilled with their choice.

What I can say, though, is that MOST people who decide to buy their homes rush in, lock themselves in, and dont see alternatives.

Nine times out of ten, housing-related costs are the largest single expense in people’s budget. Yet often, people put more thought into their car or even cell-phone purchases than their housing costs!

I will also tell you this straight up: Im personally a HUGE fan of renting.

I see far more advantages in the flexibility that comes from renting than I do with buying a single home. (This should be fairly obvious for people whove followed the journey a while).

Now, let me add that I’m not anti-home-ownership.  I’ve spent a couple years of my life in the real estate industry. Courtney and I have owned an 8-unit apartment building in the past.

I even love the potential of owning a home someday. And most importantly, I understand buying a home is more important for some people than the prospect of flexibility.

But Im sick and tired of it being the default choice for the American Dream. Its silly that we culturally view this as a must and that we almost always jump the gun as a result.

First, lets talk costs here

I’ll start you off with a (far-from-complete) list of expenses that come up when youre a homeowner.

• Property Taxes
• Remodeling Projects
• Homeowner’s Insurance
• Regular Misc. Maintenance
• Air Conditioning / Furnace
• Furniture / Home Decor
• Kitchen Appliances
• Outdoor Tools
• Electricity
• Gas
• Lawn Care
• Water Heater
• Water Softener
• Sewage
• Water
• Trash
• Landscaping
• Installation Fees
• Pest Control
• PMI
• Association Fees

Anyone else who has owned property of some sort could probably think back and add a few dozen bullet points to this list (yikes!).

You may or may not incur these costs when you buy (or during the time that follows), but many, many people do. And, once again, as a culture we rarely plan and budget for these expenses.

Do not stop at PITI, which stands for Principal, Interest, Taxes, and Insurance. 

Many people do their calculations based on PITI (even in the real estate and investing industries), without considering much else. This will backfire big time.

Slow down and think about everything you are signing up for.

This is life changing. Likely the biggest expense youll ever have in your life.

Slow. Down.

What I don’t love – is the myth that owning a home is a *must* or a *smart move*.

I don’t love the MYTH that owning a home is a smart investment.

Real estate can be an investment in some cases – but viewing your personal residence (where your family eats and sleeps) as an investment is a mistake.

Your primary residence should not be viewed as an investment, plain and simple.

The view that owning a home is an investment has led us to a huge bubble that has put millions of Americans in cages made of underwater mortgages. I don’t have to tell many of you this – I’ve heard your stories loud and clear.

One of the most interesting things I learned on our RV tour was the cost of homes across the country. Courtneys mom bought a four-bedroom, 3000-square-foot home for under $100,000 in Indiana.

In Asheville, you wont find nearly as many structures under $100,000 (very few). In Burbank, CA, most two-bedroom bungalows (1000 square feet) sell for $500,000.

We are all blanketed with one idea that we should be homeowners, but arent given an equal opportunity to do it. Circumstances are incredibly varied (job, location, family situation, freedom, social pressure, etc) yet weve prescribed one solid path to success for decades now OWN A HOME, BABY!

This social pressure leads us to incredibly bad mindset for making life-changing decisions like this.

And it leads a tremendous amount of people to a trapped lifestyle (physically and mentally).

So when does it make sense to buy? Here’s your new set of rules:

• If you plan to live in an area 5-10 years minimum.
• If you are debt-free (before the mortgage).
• And if your TOTAL housing costs are less than 25% of your take-home income.
• Big one coming: YOU actually want to buy!

ONLY THEN, consider buying a house among one of your MANY choices for providing shelter for yourself and your family.

If any of those conditions are not met – you shouldn’t be buying a house.

Thats the bare minimum.

These will be considered by many to be conservative rules of thumb but you need to be conservative about locking yourself into a structure. Learn from our nations mess!

Id also say consider the following:

Do you have the skill to do simple home repairs?

(Anything from replacing a piece of gutter to fixing a leaky faucet.) If you have to call a professional for this relatively routine stuff, your costs are going to add up quickly, but if youre fairly handy, it might be more economical than renting a home with repair service built into its costs.

Do you have the TIME to do these repairs and regular maintenance?

(Lawnmowing, mulching, changing furnace filters, etc.) If so, and if you enjoy those tasks, great. If not, renting or purchasing a home in which these things are handled by an association might be a better fit.

Do you have unique needs?

For example, if you want to keep 12 pets if you have 10 children if you need to be able to create in-law quarters renting MIGHT not offer you the options necessary. In this case, a property you own might allow you to better manipulate your space.

Again, slow down. It isnt the end of the world to wait and rent!

*******

When does it makes sense to rent?

Well, like I said, I truly believe almost anyone can benefit from renting. When we talk about freedom and what that looks like it becomes really clear that a mortgage is a BIG tie-down.

But here are some situations when its especially good to rent.

• If you plan to move in the next five years (or sooner!)
• If you arent able to or prefer not to do external and internal home maintenance.
• If you are still paying off your consumer debt.
• If your career or family situation is LIKELY to change drastically in the next year. (Marriage, more kids, kids leaving home, salary change, starting a new business)
• If you are buying a house because its what you are supposed to do.

Again, thats the bare minimum.

But also consider these issues:

Do you dread researching plumbers or electricians and getting quotes?

Forget skimming the yellow pages trying to find a reliable serviceman with the best rates. You have one phone number to call when things go wrong. And they take care of it all. Welcome to renting!

Do you want to experience a neighborhood before you buy?

Its fun to imagine living in a new place, but its also intimidating. How much will I really like it? Will I really be able to work at the cafe during the week? Do I really want to be ten minutes out of town? Do we click with the neighbors? By renting in an area, you can test the water without too much commitment. Its far better than being two years into a mortgage and regretting where youve planted yourself.

Do you want to have a better idea of how much youll pay each month in housing?

Rent doesnt change (well, nearly as much as housing costs). The far majority of expense swings related to housing are the landlords responsibility in most situations and areas. Consistency and simplicity allow you to focus your time and stress reserves on more important things in life you want to accomplish.

*******

Im wasting that money, when I could be investing it.

Sigh.

First, do the math (honestly, with all the numbers for all the expenses). In a lot of situations, this is an ASSUMPTION and simply not true.

Second, consider opportunity costs of the additional flexibility that comes with renting.

Third, much of your investment is going to interest (and in some cases taxes and insurance in the primary payment). If you move in the first few years, you arent investing in almost anything especially when you factor in costs of selling and buying.

Once again, I firmly believe your quality of life will increase dramatically when you STOP viewing your primary residence as an investment.

Ready to think differently about your home and your money? Get our Unautomate Your Finances guide, as well as several other awesome resources to kickstart your money, join the Man Vs. Debt community list by clicking here!

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Over the last few years, the perception of whether renting or buying is smart or dumb or a waste has dramatically changed. A huge collapse and a recession can do that for you.

What it comes down to, though, is mindfulness .

Be aware of YOUR situation.

Dont get sold an American dream that turns into a nightmare. Its happened to millions of people (and many emailers).

Dont trade your freedom for something that is only that a THING.

Your home isnt you. It isnt your family.

Its a roof over your head, a place to sleep, something totally and utterly replaceable.

Your HOME and your HOUSE arent necessarily the same thing.

You can make a HOME out of many situations.

We value the opportunity costs of living a flexible life far too highly to burden ourselves with a huge mortgage and the cost of upkeeping a home.

What about you?

Have you had a fantastic or awful experience with buying or renting?

Have your beliefs about owning a home changed in the last 5 years?