Renting vs. Buying in Retirement: Which Is Right for You?

If you\'re retired, should you buy or rent a home? Here are some things to consider before choosing.

The rent vs. buy debate has long been argued. But for those in retirement, the dilemma deepens.

Sure, homeownership offers stable, reliable payments (great for that fixed income) and the ability to customize your property as you choose, but renting offers perks too. From the lack of maintenance and repairs you’ll have to do to the easier qualification process and the lack of long-term commitment, rental properties can be a good choice as well.

So, how do you choose?

A great place to start is with your pocketbook. How much does it cost to own a house in your preferred area vs. renting one? How do those numbers fit into your overall financial picture? Let’s break it down in more depth.

The Costs of Owning a Home vs. Renting

First off, start with your ideal retirement location and take a look at both home prices and average rents. Be sure you’re looking at comparable properties—homes that offer you the space, amenities, and level of comfort you’re looking for in retirement. 

You should also pull up a mortgage calculator to get a feel for what your monthly payment would be. Remember that a mortgage payment will also include your home insurance and property taxes. These are items that would be paid for by your landlord or property manager should you decide to rent. 

Finally, consider the other costs that come with each housing arrangement:

  • When renting, you might have security deposits, pet deposits or rents, condo fees, maintenance fees, and more.
  • As an owner, you’ll have to cover maintenance and repair of the home, the initial down payment and transaction fees associated with buying the property, and interest over the course of your loan.

You can also factor in any property tax exemptions you might be eligible for as well as the mortgage interest tax deduction, mortgage credit certificate, and other tax benefits that could offset the costs of homeownership.

Your end goal should be to determine the monthly cost of owning a home vs. renting one in your desired area. If there’s a stark difference, then you have your answer. If there’s not, then you have some more thinking to do.

More Than Just Money

Of course, renting and homeownership costs are only part of the equation. You also have to look at the bigger picture—the non-financial one. 

Here are some other considerations you might want to take into account:

How much will you actually be at the home?

Do you plan to travel a lot? Will you busy with lots of activities and hobbies? If so, maintaining your home may be difficult and renting may be the best scenario. If you expect to stay home and live a slower life, then owning could be the better choice. Just make sure you have the time necessary to care for your property before diving in.

How much liquidity do you need?

Owning a home ties up a lot of cash. Though you can certainly sell the property and access that cash later on, it’s not a simple or easy process. If you need lots of liquidity and quick access to your money, then buying probably isn’t the safest bet. If you can afford to invest your funds for an unforeseen amount of time, then buying is a viable option.

How much space and privacy do you need?

Renting means you’ll probably be in some sort of multi-family building or condo community, which inherently means less privacy and more neighbors. Want a more secluded lifestyle with just you and your partner? Then buying may be the better choice.

How important is stability?

If you’re on a super-limited income, renting could pose a risk. When you own a home, you have control over your costs (you can switch insurers, DIY your repairs, or even sell your house and move if you need to). With renting, you’re at the whims of your landlord. You could see a steep rent hike or even lose your home with very little notice.

What sort of legacy are you looking to leave behind?

There are two sides to this coin. On the one hand, renting means you won’t leave your heirs with any huge, outstanding debts (like a mortgage). On the other, it also means they won’t get a significant asset (like a piece of property) when you pass. Consider your overall retirement goals and see what fits into your plans best.

How much time do you need—and how much digging into your finances are you OK with?

Rental applications can be processed fairly quickly—usually within just a few days. But with a mortgage, you’ll probably be waiting at least a few months (not including the time your home search takes) before you can make your big move.

There’s also the qualifying process to consider. Landlords will usually look into your credit and run a background check, but that’s where it ends. When buying a home, your lender will need bank statements, tax returns, W2s, and more. Determine what you’re most comfortable with as well as what you have the time for.

Will you move again in the future?

Are you looking for your final living place, or is there a chance you might move again a year or two down the line? Moving as a renter is a much simpler and more affordable process. While you can definitely sell your home if necessary, the effort, time, and money it takes is more substantial as an owner. So if you plan to be more transient in your twilight years, a rental is probably the right bet.

Thinking of buying a home in retirement?

If you’re considering buying a house in retirement, 55places Mortgage can help. Get in touch to learn about our 62+ loans today.

Can you spot the $207,744 difference between these identical homes?

Financing is the difference!

Get the details in The 62+ Loan Homebuyers Guide.

55places Mortgage is a joint venture between Mutual of Omaha Mortgage and
Details here.

Share this post:

We're here to help! (800) 928-2055

Call us to speak with a customer service representative.

Subscribe to Our Newsletter

Get Weekly Updates

I agree that 55places and its affiliates, partner providers or agents may call, text, or email me about my inquiry, which may be made with automated means. I understand that my consent is not a prerequisite for buying a property. I may revoke my consent at any time by contacting [email protected] Message/data rates may apply. I also agree to’s Privacy Policy and Terms of Use.

The Best Places to Snowbird in 2021

We’ve gathered 25 of the best places for snowbirds, including cities in Florida, Arizona, California, Texas, South Carolina, and Nevada. For each entry, we’ve also provided a list of recommended 55+ communities in the area. If you’re ready to find your own winter retreat this season, here are some of the best places to consider.

A group of older adults socialize within their 55+ community.

Top 10 FAQs About Living in 55+ Communities

We’re here to answer all of your questions about joining a mature living community, so you can feel empowered in your decision. This is the next great adventure of your life, and we’re firm believers in leaving the stress out. Check out these top 10 FAQs about living in 55+ communities.

A senior couple takes a hike in a low-humidity state they chose for their retirement.

Retirement: What Are the Top 5 States With the Lowest Humidity?

There are many factors in deciding where to retire, and the weather can be one of them. Luckily, many of the states with nice weather also offer additional benefits for people over 60 and have several exciting active adult communities. Here are the four best states for a low-humidity retirement.

Lake view during autumn at dusk of Table Rock Mountain in Pickens, South Carolina.

5 Reasons To Consider a South Carolina Retirement

What does South Carolina have to offer active adults? A selection of over 80 active adult communities is just the beginning. These five reasons to consider a South Carolina retirement just might convince you that this southern coastal state has everything you’re looking for in a 55+ community.

The Best Places to Retire in South Carolina

South Carolina is known for having some of the best golf courses in the country, but that’s not all it has to offer active adults. The state has a rich history and culture, a wide selection of entertainment and recreation, and miles of beaches and coastal living.

North Carolina vs. South Carolina

The Carolinas are a power couple when it comes to maintaining an active lifestyle in an amazing climate, but they’re separated by more than just a border. A side-by-side comparison of the two can quickly show which is better for you when it comes to your interests and needs.

Exterior view of a model home at Del Webb Carolina Gardens, Fuquay-Varina, North Carolina on a sunny day.

55+ Communities With New Homes for Sale Near Raleigh

If you’re in the market for a new construction home in Raleigh, North Carolina there are plenty of options to consider. We’ve put together a list to help you start your search for the perfect neighborhood with new homes.

About 55places

We’re changing the way people 55 and older are searching for their perfect next place. With a national network of hand-selected real estate experts, plus comprehensive information, unbiased content, and on-the-go insight about thousands of communities across the country, we’re a trusted resource paving the way from here to home. Whether you’re interested in a low-maintenance single-level residence, an active lifestyle or age-qualified community, an intimate enclave, or anything in between, we can help you make your next move the best one yet.

Scroll to Top