Recently, I was listening to a financial podcast where the topic of renting versus buying came up. It is a conversation I hear often here in Fargo and throughout North Dakota.
Some of the data shared in that discussion was significant enough that I wanted to pass it along.
This will only take about 4 minutes to read, but it may change the way you think about renting and home ownership.
If someone rents through their 20s and 30s without ever entering the housing market, they may look back later and realize they missed years of opportunity to build equity.
This is not about pressure. It is about understanding how home ownership works and how it affects your long-term financial picture.
As a home inspector working with buyers across Fargo, West Fargo, Moorhead, and the surrounding communities, I see this decision play out every day.
The Difference Between Rent and a Mortgage
When you rent, your monthly payment provides housing. It offers flexibility and removes the responsibility of directly managing repairs.
When you own a home, your mortgage payment also provides housing. But part of that payment typically builds equity. Equity is the portion of the home that you own.
In simple terms:
• Rent payments build your landlord’s equity
• Mortgage payments build your equity
Over time, that difference matters.
The Wealth Gap Between Renters and Homeowners
When I looked at the national numbers, the difference was larger than most people expect. The typical homeowner in the United States has a net worth of about $430,000. The typical renter has a net worth of about $10,000.
That means the average homeowner’s net worth is roughly 43 times higher than the average renter’s.
Net worth simply means what you own minus what you owe.
For many homeowners, the largest asset they have is their home. As they pay down the mortgage and as property values increase over time, their equity grows. That equity becomes a major part of their overall financial stability.
This does not mean every homeowner becomes wealthy. It also does not mean renting is always the wrong choice. But over decades, home ownership has consistently been one of the strongest drivers of household wealth in this country.
“I Rent So I Do Not Pay for Repairs”
This is something I hear often.
Many renters feel safer renting because if the furnace fails or the roof leaks, they are not the ones writing the check.
That is true on the surface.
But those costs still exist.
Landlords factor maintenance and repairs into the rent.
If someone owns a rental home in Fargo, they are paying for:
• The mortgage
• Property taxes
• Insurance
• Routine maintenance
• Major replacements such as roofs, furnaces, and water heaters
• Occasional vacancy between tenants
Those expenses are built into the rental rate.
For example, if a roof costs $15,000 and lasts 20 years, that replacement cost becomes part of the long-term math of owning that property. The same goes for a $7,000 furnace or foundation repairs related to our expansive clay soils.
The tenant may not see a repair bill, but they contribute to those costs every month through rent.
The real difference is ownership.
When you rent, you help maintain a property that builds someone else’s wealth.
When you own, you maintain a property that builds your equity.
Fargo’s Unique Housing Realities
Owning a home in Fargo ND does come with responsibilities.
Our region has:
• Expansive clay soils that can contribute to foundation movement
• Freeze thaw cycles that affect concrete and exterior materials
• Long winters that can lead to ice damming
• Radon levels that are higher than the national average
• Drainage concerns during spring melt
These are not reasons to avoid buying. They are simply part of owning property in this climate.
With proper inspections and consistent maintenance, these issues are manageable and predictable.
Renting Feels Safer, But It Can Delay Growth
Renting can feel simpler because large repairs feel removed from you.
But financially, many renters follow the same pattern.
5 years pass. Then 10. Then 15.
During that time:
• Rent often increases
• No equity is built
• Property appreciation benefits the owner
Meanwhile, many homeowners who purchased in Fargo 10 to 20 years ago have built substantial equity through appreciation and steady mortgage payments.
Home ownership is rarely about perfect timing. It is about time in the market.
When Renting Makes Sense
There are times when renting is the right decision.
• You plan to relocate soon
• You are building savings for a down payment
• Your employment situation is uncertain
• You are improving credit
The goal is not to rush. The goal is to move toward ownership when the timing makes sense for your life.
The Right Timing Often Starts With a Conversation
One thing I see often in the Fargo market is that many renters assume they are not ready to buy. In some cases, they are closer than they think.
A knowledgeable local Realtor does much more than show homes. They help buyers understand what is realistic in today’s market and connect them with lenders who can walk through financing options clearly.
Right now, financing is one of the biggest concerns for renters considering a purchase. Interest rates are higher than they were a few years ago, and that understandably makes people cautious. But there are options many buyers do not realize exist.
Depending on the situation, a buyer may qualify for:
• First time buyer programs
• Down payment assistance programs
• Seller paid closing costs
• Rate buy downs
• Adjustable rate mortgage options
• Local or state backed loan programs
A good Realtor works closely with lenders and understands which programs are active and realistic in our Fargo and West Fargo market. They can help buyers compare scenarios and determine what payment range feels comfortable.
Often the first step toward home ownership is not shopping for a house. It is sitting down, reviewing numbers, and building a plan.
When buyers have the right team in place, including a trusted real estate professional, a knowledgeable lender, and a thorough home inspection, the process becomes far more predictable and much less intimidating.
Why a Home Inspection Matters
One reason renters hesitate to buy is uncertainty.
What if the home has major problems?
What if repairs are overwhelming?
What if I miss something important?
A thorough home inspection provides clarity.
At Nordic Inspections, we focus on education. We explain how the home works, what is common in Fargo construction, and what maintenance looks like in our climate. The goal is confidence, not fear.
Final Thoughts for Fargo Area Renters
Renting offers convenience. But it does not eliminate maintenance costs. It simply shifts how they are paid.
If you rent for a few years while preparing financially, that can be wise. But if you never enter the housing market, you may delay one of the most consistent paths to long term financial growth available to everyday families.
If you are considering buying a home in Fargo ND or the surrounding area, start with a conversation with a trusted local Realtor. When you are ready to move forward, Nordic Inspections is here to help you understand the home itself so you can make informed decisions with clarity and confidence.
Home ownership is a responsibility. It is also an opportunity.