My husband, Chris, and I made a huge decision for our family a few months ago: We sold our house in the Kansas City, Missouri, suburbs and signed a lease on a rental home.
Our friends and family were confused, to say the least. “You’ll buy again soon, right?” they asked. Their skepticism only increased when we responded, “We’re in no hurry.”
While a lot of people close to us were supportive of our choice, others couldn’t wrap their heads around why we gave up homeownership to rent. Why would you rent with three kids and a dog? For some of them, going from owning to renting was taking a step backward. But for us, giving up the cachet of homeownership was a small price to pay for the financial freedom we gained in the process.
WHY IT WAS THE RIGHT TIME TO RENT
After living in our home for six years, we decided we wanted to be closer to the city and Chris’ work because of the toll his daily commute was taking. Around that time, the housing market was also getting hot. So we decided to list our house for sale — and accepted a favorable offer the very next morning. We made a decent profit and, suddenly, we had some extra cash.
We considered buying another home right away, but competition was tough and prices were high in the markets we were interested in. There were few options that we felt were worth paying top dollar for because they weren’t quite suited for our family. We did make an offer on a home that we felt was just OK, only to have the seller come back and ask for more money.
After thinking about it for a while, Chris and I decided to rent because we’d rather be more thoughtful about our decision to buy, which meant taking time to find the right place. Not only that, we could be more intentional about some other financial goals we wanted to tackle, like funding our retirement, paying off debt, raising our family and more. We felt we could do that better without being strapped to a mortgage or stretching our budget to cover home maintenance costs.
Looking back on our decision, we realize it was one of the best we’ve made as a family.
WHAT WE GAINED BY RENTING
More Family Time. Location was a big factor for us in this decision, especially as it became clear that Chris’ commute to work (nearly an hour each way) was affecting our family life. His daily drive consumed precious time he could have spent with us, and the cost of filling the tank multiple times a week was a drag on our budget. Since we’ve started renting, Chris’ commute has been a cinch.
An Auto Upgrade. Speaking of the commute, Chris wasn’t the only person beaten down by it: the family van had also had enough. The transmission was failing, so we used some money from the home sale to buy a used — but far more reliable — vehicle. Although we won’t be driving it as much on a daily basis, we feel safer when we’re on the road as a family.
Debt Paydown. After replacing the van, we turned our attention to paying off some debt, including a credit card with a high-interest rate and some medical bills that had been hanging over our heads. The home sale, along with what we save each month from renting, has allowed us to accelerate those debt payments. We'll save a lot in interest in the long run.
It’s a huge relief knowing we won’t find ourselves asking, 'But what about the house?' when we want to make the next big change in our lives.
Retirement Savings. Because our monthly rent is lower than our previous homeownership costs, it’s freed up more of our income for retirement contributions.
Travel. After making sure we had our essential costs covered, Chris and I found we had wiggle room for doing something fun. We booked a couples’ trip overseas to Lisbon. We will also be taking a road trip with the whole family to the Grand Canyon this summer.
Flexibility. As homeowners, we felt tied down to our home. Weekends were spent doing yardwork or tackling the seemingly unending list of home maintenance projects. We liked the house, but we also like getting out of the house. Selling it felt like the best way to break free.
We also felt like renting would give us more control over the life we wanted to live. If we change our minds about a city or state (or even a country), it’ll be far easier to pack up and move as renters — especially if the housing market sours. It’s a huge relief knowing we won’t find ourselves asking, “But what about the house?” when we want to make the next big change in our lives.
WILL WE BUY AGAIN?
Ultimately, we feel really good about our decision to become renters again. Sure, we made a nice profit when we sold our home, so I understand why some people might question our decision not to make an investment in another home right away.
But now that we don’t have a mortgage, we have more options for where we want to go in the future — not just years from now, but even months from now, if the opportunity strikes.
We haven’t given up entirely on the idea of owning another home someday. About half of the earnings we made off our home sale is in a high-interest savings account, just in case we decide we want to buy in the next few years and need a down payment. But for now, what’s best for our family is having the flexibility to focus on other goals. It has been eye-opening for us to realize that we can create the life we want — even if that doesn’t look like everyone else’s American Dream.