The hidden savings in a rent payment

This post is from staff writer Jeffrey Steele.

The hidden savings in a rent payment

The scene was a sidewalk café on Chicago’s northwest side one summery evening around 2006. I’d been joined for dinner by a couple friends, Grant and Kate, and between bites of chicken Vesuvio — or was it a chopped salad? — was enjoying the witty, intelligent repartee of my two companions.

There was a lull in the conversation, and then Kate turned to Grant, the only renter among the three of us. “So, when are you going to join us among the ranks of homeowners?” she asked, in a tone of innocent inquisitiveness.

I expected Grant to offer a timetable for home purchase. But he instead responded as if Kate had impugned his ethnicity, or had scorned his mother’s good name. It was clear he was very sensitive about his renter status.

His deeply wounded reaction was a reflection of the era. It was the day and age when folks from teenagers on up were jumping at the chance to scoop up homes put within reach by zero-down payments and teaser-rate mortgages. Some felt if you were still renting in such an environment, you weren’t part of the club. You were an outcast, a pariah, and seemingly one of life’s most pathetic sad sacks.

Judging from his response, I think Grant himself held that view.

But, as events were soon to show, Grant wasn’t behind the times. He was ahead of them. Just a year or two later, the mortgage meltdown would throw many overextended new homeowners into foreclosure. Suddenly, renting became not just acceptable, but the hip, trendy, now thing to do. By shunning the temptation to join the home-buying binge, Grant had been crazy like a fox.

Renters by choice

Even in these times, when new apartment buildings are sprouting like late-spring clover to meet the surging population of renters, some still believe apartment life means simply throwing money down the drain every month.

But the expanding legions of renters by choice are convinced otherwise. Driven by a desire to enjoy life in ways you can’t when anchored to a ranch or split-level, they realize renting gives them opportunities homeowners don’t enjoy.

They can turn maintenance chores over to their landlords, have their building’s staff pick up their dry cleaning, and attend apartment building parties, meet their neighbors and make new friends. They can also pursue exciting job offers across country, without having to fret about the details of selling a home.

Beyond these renting advantages, there are a slew of economies that await the shrewd apartment resident who selects the right rental property. A partial list of such money savers might look something like this:

Apartment building fitness centers. Joining a health club can set you back plenty, but at a great number of apartment communities, particularly newer ones, the chance to work out comes on the house, so to speak. With your club just a few floors away on an elevator, you’re saving gas and wear and tear on a vehicle, too. Apartment communities lacking in-house fitness centers often give residents complimentary memberships at nearby facilities. “Gym memberships can cost upwards of $100 a month, so having your gym included with your rent is a significant savings, ” says Diana Pittro, executive vice-president of RMK Management Corp., which manages dozens of Chicago area communities.

Business centersOutfit a home office, and you’ll shell out big bucks for a computer, printer, Internet access, desk, office supplies and far more. But at many apartment communities, a welcoming business center offers residents all those necessities, at no extra cost. Moreover, home-based entrepreneurs who need to meet clients in a business-like setting appreciate the conference rooms available to residents in many apartment community business centers.

Says Barbara J. Geffen, co-CEO of Northbrook, Ill.-based Prime Property Investors, owner of two Northeast Illinois apartment communities: “Our business centers are appreciated by a variety of our residents, from casual online browsers to professionals who work from home.”

Swimming pool. Imagine the expense of installing your own in-ground swimming pool, then furnishing it with deck chairs, cabanas and pool cover, not to mention a summer’s supply of chlorine and pool chemicals. Now think of the time you’d spend keeping the pool in ship shape. It would be like a second job.

But many rental properties give residents access to well-maintained pools with all the above extras. Some of the more spectacular sparkle like jewels on high-rise rooftops, and the awesome view comes at no additional charge.

Grilling stations. At many apartment communities, there’s no need to invest in a grill, propane or charcoal. The grilling station on premise is open to residents who need only show up with their favorite foods, grill and open wide. As many renters will attest, grilling is even more tasty when it’s free.

More ways to save. These are just the start of the money savers you’ll find at a large number of newer apartment communities. Additional ones include free dog washes, car washes, on-site community rooms, party rooms and theater rooms, discounts at area stores and restaurants, cooking classes, dancing lessons, wine-and-cheese get-togethers, catered holiday parties,  discounted food deliveries and low-price premium cable packages, to name a few of the ways to economize.

As I mentioned up top, I’m a homeowner myself. But I get a bit envious when I tour one of the amenity-laden apartment communities being opened to today’s renters. As tempting as all the above economies seem, it’s the simple, joyful, carefree lifestyle renters enjoy that is so undeniably attractive.

No wonder many people returning to renting report they feel as if they haven’t just taken on a new lease, but a new lease on life.

8 Responses to “The hidden savings in a rent payment”

  1. Anonymous

    All great points, however, I agree with Thomas in the coments. Many of the shared living spaces you mention are often treated as rentals, meaning no one takes ownerships for its upkeep and cleanliness, and the quality of those shared resources suffers because of it.

  2. Anonymous

    Saving money because some apartment complexes have a gym? Most condominiums do as well, they have the benefits of apartment living plus the advantages of being a homeowner. Yes, there is a condo fee but that often takes care of trash, water and sewer, etc. That being said, the personal preferences between apartments, condos, townhouses, are more different than rent vs buy.

  3. Anonymous

    Great post. Strange how the decision to rent or buy is often a cultural thing. For example, in Germany hardly anyone buys a property, everyone is happy to rent. In the UK folks kill themselves to get on the housing ladder.

    After a few years living in China I can tell you that you are lierally nobody unless you have a mortgage and the ideal is to own several homes and rental properties.

    Me? As yet uncommitted in Malaysia.

  4. Anonymous

    Living in a place that you are renting has it up and downs. Remember you still have to share all those places and sometimes people are the nicest or cleanest. I will admit not having to pay for things like the frig breaking or a/c is great.

  5. Anonymous

    I have had two expensive air conditioner repairs in the last year that have made me wish I didn’t own my house. If I was renting, the landlord would have to pick up those major repair bills.It is a little late for all of that though. I own my house and it has gone down in value in the last three years. I am just hoping that it goes back up.

  6. Anonymous

    Both have their pros and cons. I do know from having been a renter that having a responsible landlord is essential. I’ve been lucky to have one who made sure the maintenance of the house was kept up to code, such as it needs to be for plumbing and electrically. Or if important fixtures go the way of the dinosaur, they’re repaired or replaced in relative quick time.

    If the landlord is some kind of cheapskate slacker, it can make for a very stressful time.

  7. Anonymous

    The issue to rent or own is like the issue of paying off your mortgage vs. making a monthly payment on a mortgage:

    We can talk about the “objective” pros and cons until the cows come home. But there’s a psychological and emotional component to the question that most personal finance writers ignore, and that’s about as important for most people.

    Some people find home ownership fulfilling in ways that go beyond the actual “cost” or “savings” it represents. They enjoy the feeling of actually owning their domicile. Others find the notion of renting more satisfying. They like the feeling that a landlord is responsible for their domicile, and their only financial stake is a monthly payment.

    In the same way, some homeowners are swayed by the fallacious notion of a tax advantage in making a monthly mortgage payment, while others are swayed by the security and personal satisfaction of not having a large debt.

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