Is home ownership the only way to go?

Over the long term a renter could win over a home buyer if their extra money is invested steadily and wisely, personal finance expert Mary Holm says.Discouraged renters who feel they may never save enough to own their own home should consider making the most of being a tenant for life, or at least until retirement, says personal finance expert Mary Holm. Listen to Mary HolmTo make it work, renters need to save lots of money to cover their rent in retirement or to buy a house at that time.But they can afford to, she says, because their accommodation expenses are lower than their home-buying counterparts.By saving what they would have otherwise spent on mortgage, rates, maintenance and insurance minus rent, Mary says renters might come out as well or better off than their home-buying friends, she says.The advantages of renting:Better savings diversificationLess responsibilityNo need to do (or pay someone else to do) maintenanceMay be easier to live close to downtownCan move easily and cheaplyCan use long-term savings for a business or other investmentThe disadvantages of renting: Can be kicked out - especially bad if you have childrenNo choice of decorations and garden etcCan't build value in your home through gardening and DIY improvementsLess security in retirementNo house for kids to inheritAnd then there are psychological factors, she says. Home owners have pride in their ownership of home and are in control of a very important aspect of living - but they can't walk away from responsibilities tied to home ownership.Listen to all of Mary Holm's podcasts here.Go to this episode on rnz.co.nz for more details