Rental Homes vs Rental Apartments
Whether renting a house or renting an apartment is for you depends on your lifestyle and your needs.
Renting a house virtually eliminates having to worry about dealing with neighbors living above or below you. With apartments, this is pretty much an assured reality.
If having amenities is your thing -unless you rent a house in a master-planned neighborhood. (with a swimming pool, playground, basketball court, tennis court, etc.) - apartment living is easily the better option. No master-planned neighborhoods offer a 24-hour workout facility (yet), whereas nearly all of the apartments in Austin and the surrounding areas will have a fitness center. Some apartments even offer Jacuzzi, sauna, steam rooms, free fitness classes such as spinning, yoga, kick boxing classes, tanning booth and some even an indoor swimming pool! The savings can equal over $100 per month.
Maintenance is a major factor when deciding between renting a house vs. an apartment. Unless a property is severely mismanaged, virtually all apartment maintenance is done no-questions asked; whereas, getting maintenance issues solved at rental houses can be a real headache.
When renting a house, you are effectively paying the owner's mortgage AND you are responsible to care for the house as if it were your own. But it is not. There is no vested ownership in the house and in the end you pay extra for maintenance and upkeep. Sound like a good deal?
Prior to working as an apartment locator, I worked as a repair coordinator for a property management company that manages rental houses for private owners. Whenever you see a house for rent with a property management company/ real estate company sign in the yard, you are looking at a private owner. That private owner rents out their house using a real estate company to represent them. In many cases, they also use them as the middle man to take care of maintenance issues.
As a repair coordinator, I closely dealt with tenant maintenance requests and then relayed that info to the owner. The most common issue I faced was a hesitant corporation from the owner side. And as the economy headed downwards, many owners were under pressure to reconsider certain maintenance requests. Many questions were asked, the two common being:
"how often did you change your air filter” -contracts will state that if you didn't adhere to the terms, which demands for once a month, the owner will refuse to cover 100% of the repair since it is not a normal ‘wear and tear’.
"What did you put in the garbage disposal?" Again, terms and conditions not covered under natural ‘wear and tear’ will be refused by owner.
Should you be in the market for rental houses, make sure to read your lease contract thoroughly. A lot of owners have extra provisions stating that they are not held reliable for refrigerator and dishwasher repair!
TRUE STORY: With my former rental management company - there was a case of where the dishwasher at a rental home broke down. Tenants had to wait for weeks for the repair to come through. The owner was reluctant to repair and was low on cash. Since he was not legally obligated to repair it, he simply told the tenants (through me) that they could also wash dishes with hands.
Granted, there are certainly good home owners who take a good care of their tenants but how would you know? Unlike apartments, where you can read reviews online (even though those are not necessarily reliable)- with private owners, you have to take chances.
Do you need more space for your family and your dogs? Then a house with a yard is probably your best option. Although, a lot of times, rental homes can cost more than rental apartments. To put your kids in a certain school boundary might only leave you rental apartments due to your price range.
If you are single, or if you have a significant other, a house might not always be the best choice. Do you use all the space that you are paying for rent and utility? Do you have a lot of time to take care of your front lawn/ yard so the HOA won't bother you? Another thing to consider: if the grass in the yard dies, you will be more than likely hold responsible for the replacement of the sod.
TRUE STORY: At my property management job, a tenant of a rental home was held reliable for the cost of sod replacement upon move-out. He claimed that the grass had already been dead when he and his family moved in. Unfortunately for him, he didn't have any pictures to prove.
Rental housing for people with poor credit/ foreclosure/ bankruptcy
In most cases, apartments will ask people with credit issues to put down an extra deposit equal to one month rent. Though, there are apartments that only require $250 refundable deposit + $131.25 non-refundable deposit with no standard deposit upon applying.
Rental houses on the other hand, you will usually pay a standard deposit equal to one month rent. And depending on your credit situation, owners could ask for additional deposit from anywhere between one-two month’s rent. If your rent is $1300 for a 3bd/2ba house, you could owe $2600 in just move-in costs + rent/ prorated rent is excluded!
TRUE STORY: I had a client who was approved for a rental house, but due to her recent foreclosure and low credit, the owner asked her to pay $5,000 upfront (standard deposit + extra deposit + rent)! I found her a very nice apartment that only cost $131.25 + $250 + prorated rent move-in costs! Significant difference, as you see!
Although the deposit is refundable, given the circumstances in her case, giving $5000 to a stranger to 'hold' should be thought about twice.
Owners going into foreclosure?
Tragically, many people are losing their homes in this economy. Many of, if not all, of these owners will try what they can to keep it: Short selling it before having to give it back to the bank; or renting it out so renters who are able to afford the rent, can pay for their mortgage or part of their mortgage (due to competitive market, some owners cannot rent the property for the same amount of their mortgage).
TRUE STORY: One of my clients –a couple- lost one of their incomes and were about to fall behind on mortgage payments within a few months. Their attempt at selling their home didn't turn out successful. So they opted for renting it out and they, themselves, found a nice 1/1 apartment for $800
TRUE STORY: I had several clients who were renting a house whose owner had gone into foreclosure without notifying them. The new owner showed up and told them to move out. They bought the house for themselves or for their kids to live in and were, therefore, not interested in it as being an investment property. Fortunately, they were nice enough to give them a few weeks to move.
Unlike private owners, even when apartment management companies change hands, they will honor the lease contract and will keep their tenants in place until the end of their lease term. So you have more stability here.
Again, to rent a house or to rent an apartment is completely subjective. Whether a house or an apartment is for you depends on your lifestyle and your needs. Rental houses with a nice size yard are ideal if you have a big dog or kids. My professional opinion on rental houses vs. rental apartments is solely based on my experience and encounter with situations from my past clients. I think it is always helpful to know of different angles before committing into something and regret it later: "I wish someone would have told me this!".
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Hi, I'm Kannika. I have been in the real estate/ apartment locating business since 2008. In 2013, I finally got tired of working for The Man and decided to leave Austin's biggest apartment locating company to start my own. Due to my dedication to my clients and hard work, Apartments Express is still helping many people find an apartment to call home. More about me.