For many Americans, renting remains their only option. But for millions of others, renting is a lifestyle decision. According to a survey by Fannie Mae in 2000, 32 percent of renters said they rent out of choice and not necessity. And nearly 40 percent said that buying a home was either not an important priority or not a priority at all. For these households, apartment living not only fits their busy lives, but it can also make financial sense. A quick review of some of the renting versus owning myths shows how this can be the case.

MYTH: OWNING A HOME IS A HUGE TAX BREAK
Reality: The tax advantages of owning are often not as large as is commonly believed. If your mortgage interest and other itemized deductions do not add up to more than the standard deduction (currently $7,200), you don’t get any tax advantage. That means the mortgage interest deduction is irrelevant for many lower- and middle-income owners who don’t itemize. For those who can deduct their mortgage interest, it still may not be worth it for them to pay $1 in mortgage interest in order to save 28 or 33 cents in taxes. Once you consider the additional costs of ownership – such as home repairs and property taxes – the tax benefits seem even less important.

MYTH: PAYING RENT IS THROWING YOUR MONEY AWAY INSTEAD OF BUILDING EQUITY
Reality: In the first five years of ownership, nearly 90 percent of the money spent on monthly mortgage payments goes for interest. That means that most of your mortgage payment is also "money down the drain," and not money building equity. On top of that, the cost of buying and selling a home can total 10 percent or more of the property’s price. Given that nearly half of all homeowners move in the first five years, the fact is that most would have saved money if they had rented.

MYTH: INVESTING IN A HOME IS A CAN'T-MISS INVESTMENT
Reality: Homeownership may not be the best place to get a strong return, especially if you look at the average home price appreciation versus appreciation of other assets. For instance, over the 1990s, the Standard and Poor’s 500 gained 338 percent, while the median price of a home rose only 44 percent. Plus, like any investment, real estate markets can go up and down. Predicting whether the price of a specific house in a specific market will go up or down is very difficult. Moreover, putting all your money in a house is like putting all your wealth in a single stock in the stock market. It’s a risky financial strategy.

OTHER REASONS TO CONSIDER RENTING

• Maintenance-free, hassle-free living
• Superior amenity packages that rival and often surpass single family homes
• Access to new technologies that are unaffordable or unavailable in single family homes
• Ability to relocate for job opportunities without having to incur the cost of reselling a home
• Convenient access to transportation, employment, retail and entertainment
• Organized social opportunities with fellow residents