Is Buying Cheaper Than Renting? Renting Vs. Buying Your Next Home

Are you struggling to decide between renting or buying a home? As someone who works in the real estate industry, I have had clients facing the same dificult decision. Both options have their benefits and drawbacks, and it's not always clear which option is right for you.

While buying a home is often seen as a sign of success and stability, it's important to recognize that it's not the right option for everyone. For many families, renting offers a level of flexibility and freedom that buying a home simply can't match. 

So, let's explore the factors that come into play when deciding whether to rent or buy a home, and help you make an informed decision that best suits your unique circumstances.

Pros of Buying

Buying a property is a significant investment, but it can also be a smart long-term financial decision. Homeownership allows you to build wealth over time, take advantage of tax benefits, and leverage one property into several.

Building Equity:

When you buy a home, you are investing in your future. With each mortgage payment you make, you are building equity in your property. Over time, the value of your home is going to appreciate, increasing your net worth and allowing you to sell your home for a profit down the road. As a mater of fact, over the past 10 years, the median price for single family homes on Oahu increased by $480,000 ($1,105,000 - $625,000 = $480,000). Condos and townhomes expereienced a similar burst of appreciation, going from a median of $355,000 in 2012, to over $551,000 by 2022 (an increase of $196,000)! That's a lot of equity!

*All graphs use date pulled from MLS*


Alternatively, you could acquire a “home equity line of credit” (HELOC), which will allow you to use the equity you’ve built in your home to purchase more properties, effectively turning one house into multiple! This is not the case when you rent - your monthly payments go directly to your landlord, and in return you get just one more month of living in their unit.


Another advantage of buying a home is the stability it provides. When you rent, you are at the mercy of your landlord. On a whim, they can choose not to renew your lease, raise your rent, or even sell the property you’re living in. As an example, in the past 10 years, median rents have increased by an astounding 25% here on Oahu. When you own your home, you have way more control over your living situation and can better plan for the future with predictable mortgage payments. You can make changes to the property as you see fit (like adding an extra room or hanging plants outside) and you can stay there as long as you want, all while building wealth that you can pass down for generations. 

Tax Benefits:

Owning a home comes with certain tax benefits. Mortgage interest and property tax payments are tax deductible, meaning you could potentially save money on your taxes each year just by owning a home. Renters unfortunately do not have access to these money-saving deductions.

Sense of Pride:

Buying a home can also give you a sense of pride and accomplishment. It’s a big milestone and it can be incredibly rewarding to own a property that is truly yours. As the age-old saying goes: “the best time to buy a home was 10 years ago, the next best time is now.” It's a good time to start thinking about where you'd like to be in the next 10 years.

Cons of Buying:

Upfront Costs: 

Buying a home typically requires a significant upfront investment. You'll need to budget for a down payment, closing costs, and other related fees like taxes and insurance, which can be a barrier to entry for some families. (However, it’s worth mentioning that there are several ways to minimize the initial investment you will need to make and you could possibly avoid paying 20% on your down payment).


Owning a home or condo comes with a range of maintenance requirements that need to be carried out regularly to ensure the property is in good condition and avoid costly repairs. This can include yard work, pest control, cleaning, roof maintenance, etc. It can be a time-consuming process, and let's face it, nobody wants to fix a toilet on a Saturday afternoon, but with a little effort, you can ensure that your property remains in good condition for years to come, and garner a higher price when you choose to sell.

Less flexibility: 

If you’re someone who likes to move often or get a feel for a new neighborhood before committing to a long-term mortgage, the lack of flexibility associated with owning a home or condo can be seen as a drawback. When you own a property, it can be more challenging to move, particularly if you need to sell your property first. This can be limiting if you are unsure about your long-term plans.

I've had clients discuss with me their thoughts for and against both options, and more often than not, if it's within their means, they usually end up buying a home. 

Buying a home requires a significant financial commitment, and it may not work best for those who are planning to move frequently or who cannot yet afford the upfront costs associated with purchasing a home. After all, as of 2022, roughly 4 in 10 Hawaii residents are renters. 

Pros of Renting:

Renting is often the preferred option for those who want flexibility and don't want to be tied down to a particular property or location. Renting can also be more affordable in the short term, as you don't need to come up with a large down payment or pay for ongoing maintenance and repairs.


One of the biggest advantages of renting is the flexibility it offers. Renters have the ability to move around more easily, whether it be to a new city or simply to upgrade to a bigger or nicer apartment. It can take months to sell a home, but only a matter of weeks to move to a new rental, and for those that love to explore, that's a huge key. You can sign a short-term lease and move on to your next adventure with ease!

Low Upfront Costs: 

When you rent, you typically only need to pay a security deposit and first month's rent. You don't need to come up with a large down payment or pay for closing costs, which can be prohibitively expensive for many people. Renting allows you to avoid paying the high costs associated with buying a home, keeping more money in your pocket for things like vacations or dining out. This makes renting a seemingly more affordable option in the short-term for those who don't yet have the necessary savings.

Less Maintenance: 

Depending on your lease agreement, when you rent, your landlord may be responsible for most maintenance and repairs. This can be a significant cost savings, particularly if you are not handy or don't have the time to take care of repairs yourself. Also, if you've ever forgotten your keys in your unit like I have, you'll find comfort in the fact that your landlord will always have a spare copy. 

Cons of Renting:

Lack of Control: 

When you rent a home, your landlord is in full control. You may not be able to make changes to the property without the landlord's permission, and you may be limited in your ability to decorate and personalize the space (like repainting a room or adding shelves). There may also be additional regulations when it comes to pets, with some landlords either not allowing them at all, or requiring a larger deposit from you. 

No Equity: 

When you rent, you are not building equity in the property, which means you won't be able to benefit from any appreciation in value over time. Over the next 10 years, if you were to rent at today’s median prices ($2,395 for a 2 bed condo), you will be spending over $280,000 in total, and none of that goes towards building equity for you. Instead, your landlord will have built massive amounts of equity during that time, and will likely have raised your rent once or twice.


When you rent a home, your landlord may choose to increase your rent at the end of your lease. This can make it difficult to budget and plan for your future expenses, especially when you consider that the median rent has increased by roughly 2.5% annually over the past 10 years. Landlords can also choose not to renew your lease or even sell the home you are renting, forcing you to pack up and leave unexpectedly. 

Final Thoughts

Whether you choose to rent or buy depends on your personal situation and future goals. If you value flexibility and low upfront costs with little maintenance to worry about, renting may be the better option for you. If you're looking to build equity and leverage your property to gain wealth in a stable and predictable environment, then buying is definitely the way to go.

Ultimately, the decision to rent or buy should be based on individual circumstances and goals, and we are always sensitive to the desires of our clients and love guiding them towards the best possible living situation.

For a home ownership consultation, or to keep up with the real estate market via Team Wong's Newsletter, please register on he contact sheet below. Aloha!

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