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1. No risk of ownership: The increase or decrease in real estate values is not an issue for renters, since they have no money at risk. 2. Limited duration: Renters can limit the length of time they wish to stay in a property without worrying about selling it upon leaving. 3. Broader service: Usually, more services are expected by a tenant in a rental property than by a unit owner. For example, in a rental, if appliances are in need of repair or the walls need to be painted, the landlord is usually responsible, while in a cooperative or condominium these are the responsibility of the apartment owner. 4. Liquidity: The renter's financial assets remain available for an alternative investment, which may have a higher economic return than owning a home. Disadvantages of a Rental Property 1. No economic gain: Real estate, over the long term, has usually proved to be an excellent investment, offering attractive economic returns and favorable tax treatment when the property is sold. This tax benefit is not available to renters. 2. No tax advantages: The tax deductibility of interest and real estate taxes frequently make it cheaper to own than to rent. 3. Aesthetic: Renters are usually reluctant to make significant improvements in their apartments since they know their investments won't bring them any financial returns. Indeed, many landlords prohibit alterations of the property. Therefore, it is not easy to customize rental property to fit the lifestyle of the tenant. 4. No permanence: A renter is subject to the terms of a lease, which includes limits on the duration of his or her occupancy. The tenant may have to move at the end of the lease term. This article has been edited and excerpted from The Ultimate Guide to Buying and Selling Coops and Condos in New York City by Neil J. Binder (Nice Idea Publishing, 2001). The co-founder and co-owner of The Bellmarc Companies, Neil Binder's cutting-edge information makes this guide indispensible for anyone looking to buy, sell, or relocate in Manhattan. This book is available at better bookstores, by calling (212) 252-1900, or online at www.bellmarc.com.
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