Is rent money really dead money?

New home key rent buy

“Rent money is dead money.”

“Stop paying someone else’s mortgage.”

“You pay more rent than you would a mortgage.”

These are all words that renters have heard at some point. But are they true?

The truth is that there are pros and cons for both renting and buying.

Here are a few scenarios to consider:


Renting generally provides more flexibility than buying. At the end of your lease, you can pack up and move to a different house, different town or different state with no concerns. For many reasons, you may not be ready to put down roots. Renting allows you this flexibility.
However, the costs associated with buying and selling a house make it less flexible. It costs around 4% of the sale price of your home to sell (agents fees, advertising, etc) and about 6% of the purchase cost to buy (stamp duty, government fees, etc). It is unrealistic to do it on a regular basis.
Remember though that flexibility works both ways – your landlord also has flexibility and may terminate your lease at the end (or during under certain conditions), even if you want to stay.


Renting can be a way to live in an area where you cannot afford to purchase a property. You may not have the ability to purchase a million-dollar property but could afford to pay $800 per week in rent.
On the flipside, home values mostly always rise over time, which means rent will also rise.
And don’t forget – you never stop paying rent. You might pay rent for 25 years, whereas you would pay off a mortgage in that time.


As a renter, you are not responsible for fees such as rates, home insurance, maintenance etc.
The negative is that the home is never really yours. You can’t make changes to suit your circumstances or oblige your daughter’s request for a pink bedroom.

As you can see, there really are pros and cons for each option. You need to weigh up your own circumstances – both personal and financial – and decide what best suits you. Once you do, contact Ray Real Estate to help you on your real estate journey.

We have had excellent service and communication with our property manager who always seems to go the extra mile in ensuring that both landlord and tenant are satisfied and the property is in good order.


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