Buy or Rent? What About a Small House?

First, I apologize for the seeming glut of sponsored posts, I try to keep them to only once a week at most, but had to get this last one in this week. I’d really prefer not to dilute the blog too much with advertising. I know that’s not why you’re here. Anyway..on to the topic at hand!

Throughout the Personal Finance Blogosphere, there’s an ongoing debate as to whether it makes more sense, financially speaking, to buy a house, or to just rent and put the money you would otherwise be spending on a mortgage into a more profitable investment vehicle. I’m not here to say one is right or wrong, I’ve gone back and forth quite a bit myself on the issue. Like most things, I think it ultimately boils down to what you are most comfortable with. Some people can be perfectly fine with renting their whole lives and being free from the costs and tribulations a house can bring. Others may want the security of knowing they have a place to call their own.

With this in mind, I’ve been looking into ways to have the best of both worlds, as it were. One of the biggest incentives to rent is that it’s cheaper than a mortgage, and you can invest that extra money into a bigger pot at the end of 30 years. Is it possible, given enough money as a down payment (if I decided to take down a mortgage, of course), that it would cost less than renting out an apartment? Perhaps, though property values are rather high in my area. I’d need to get a very modest house, which really I’d have no problem with at all.

After all, extra space is something I can do just fine without. For me it comes down to what I’m willing to pay for that extra space. For every square foot you add to your dream house, the more money you are going to have to pay, either via a mortgage (thus paying more in interest) or outright. The more money you have to pay the more you’ll have to work..see where I’m going with this?

I’ve no intention of slaving away for the next 30 years to say that I finally own my house and not the bank. Instead we’re going to have to try and slim down. Doing a quick search I came across the Small House Society. If you’re interested in looking into smaller living, they have a lot of great resources, even if the navigation is less than stellar.

Here’s some other interesting living links I found on my travels:

• Tumbleweed Houses: This is pushing it, even for me, but they have some great ideas and plans for houses that are small on space, big on efficiency, and great on the wallet.
• I Can’t Remember has a great post about moving to a smaller house.
• Our Green Community talks about living in a small home and the benefits it entails.