Should You Rent an Apartment or Buy a Condominium?

Feb 19, 2021

Owning your home could be cheaper than renting. Find out how much you could save by choosing the right property.

Deciding whether you should rent or buy your home is a big decision. There’s no doubt buying a home can be expensive, but did you know that in many cases, it can be more affordable than renting? To help you make an informed choice, we’ve weighed up the costs of buying versus renting your home.

To give you an idea on the savings you could enjoy, we’ve calculated the numbers off the assumption of a 2.91% interest rate, with 35% down payment on a 30-year loan. These calculations also take into consideration property taxes at 2.20%, Homeowners Association (HOA) fees per square foot of $0.70, based on a marginal tax rate of 37% and an historically accurate appreciation rate of 4%*


Taking into account everything including purchase price, costs per sq foot, downpayment, mortgage payments and taxes — buying your home can still be cheaper than renting in a lot of cases.

For example, let’s compare a 2 bedroom condominium in Midtown, Houston. Even once you add up all upfront and ongoing costs including mortgage payments, HOA fees and property tax, you’re still $371 better off year-on-year compared to renting a similar property.

When you look at a similar studio unit, the benefit is even greater. After taking all costs into consideration, you’re saving an extra $551 per year.

This goes to show that owning your home, can be kinder to your hip pocket in the long term.


Historically, property is seen as a good investment, as the value of property generally rises.
Based on a historical 4% appreciation, after 5 years your home could appreciate in value from between $51,626* (studio) to $244,911* (3 bedroom).

Unlevered Yield

Investing in a condo is also highly beneficial, with investors enjoying anywhere from 1.9% - 5.3% unlevered yield year-on-year. These figures take into account tax savings, purchase price, costs and rental income. There’s no capital growth included in these estimated figures, so the overall benefits could be even greater.

Long-term Benefits

There are other benefits to owning your home besides the savings.

For example:

  • You’ll no longer be paying off someone else’s mortgage
  • You can use your home as equity for future property purchases
  • You’ll have the freedom to personalize your space however you want
  • Your home can be used as a retirement nest egg

Browse our high-rise condominiums to begin your homeowner journey.

*4% appreciation value comes from the S&P/Case-Shiller U.S. National Home Price Index. Historical data from the national home price index indicates appreciation rates around 4% annually.) Condominium prices based on Caydon units available for rent and sale as of 19 Feb 2021.

The information contained in this article is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. We make no warranty as to the accuracy, completeness or reliability of the information, nor do we accept any liability or responsibility arising in any way from omissions or errors contained in the content. Caydon recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.