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how to save money on housing

Save Money on Housing Costs when Buying or Renting a Home or Apartment

One of the main ways you can save money on housing over time is by reducing your monthly mortgage or rent payment. Your mortgage or rent payment is probably one of your biggest monthly expenses. For many people, it is their biggest expense. Here are ideas for ways that you can reduce the bite this bill takes out of your budget.


1. Save money on rent by moving to a cheaper place.

If you’re renting an expensive apartment but are financially strapped or want to be able to put more money toward reaching other important financial goals, it’s a good idea to move to a less expensive place. If you’re in an area or a certain apartment complex where rent is particularly high, see how much money you can save by moving to a different part of town or another town or to a less expensive complex.


2. Sell your home and rent a cheaper place.

Though this is one of the ideas for saving money on housing expenses that probably requires the most amount of work, it is also one of the options that can save you the most amount of money on your housing costs. If you own a home and your payment is more than 30 or 35 percent of your take-home pay (after taxes and if you are a tither or very generous giver, after subtracting those numbers, as well), you might want to find cheaper housing to get more breathing room in your budget. If you are likely to get significant raises in the next few years and are willing to sacrifice a little in other areas you will probably be OK, but if you are struggling every month to make your house payment or pay your rent, that’s probably a good indication that it’s time to prepare for a move.

3. Sell your home and buy a less-expensive home to save money on housing expenses.

If you want to sell your home but don’t want to rent, then selling your home and buying a less-expensive, perhaps smaller, home is another good option to save money on housing. There are a number of ways you can reduce the amount of your mortgage when you sell your home and buy another. Some ideas include:

  • Move across the tracks. Not necessarily literally, but as mentioned in the section above, you can generally save a lot of money if you’re willing to live in a neighborhood that’s not the most coveted one in town. Of course you don’t want to move to an area where you would actually be in potential danger or where you would have a great deal of anxiety over the thought that you might be in danger, but consider living in an area you might at first have thought wasn’t good enough. We made this tradeoff ourselves when we bought our current home because I wanted to live closer (much closer) to work and my husband wanted to have a good-sized yard. So we live in a modest home in an area that isn’t our ideal (though it has a lot of things we do like, like being right next to a large park and a trail and in easy walking distance of the library and a grocery store). We do have an alarm system (which I LOVE—SimpliSafe; you can check them out here—that we pay $15 a month for and that doesn’t require a land phone line). We also have a large, intimating dog—whom we also LOVE :)—and between those two things we’ve never had a problem. We pay about $20 a month on dog food, so between those two things we pay less than $40 a month but we were able to save literally hundreds or thousands of dollars a year on mortgage payments by not buying a home in a more expensive, nicer area. (I say were because as of two years ago we were able to pay off our mortgage, and we have been completely debt free ever since! Being mortgage debt free—again—by the time we were in our mid-thirties is just amazing! And this time, we don’t ever intend to go back into debt. #debtfreeforever) Learn strategies to pay your mortgage off early.
  • Move to the suburbs and farther away from the metro area. If you are OK with a little bit longer (or sometimes, quite a bit longer) commute and want to stay in a relatively nicer area, this could be a good option for you.
  • Downsize your home. Perhaps you have a bigger home than you really need. Maybe the kids have moved out, or maybe you just realized that you don’t need as much space as you once thought you did—or that the extra space that you have to clean and maintain just isn’t worth it. Downsizing your home can make a huge difference in your being able to reach your financial goals.

4. Consider buying a home.

For many people, buying a home is part of the American dream. And in many cases, owning a home is a wise financial move (no pun intended). If you are on strong financial footing and can meet the following criteria, it might be time to look at buying a home:

  • You have a three- to six-month emergency fund. Having a three- to six-month emergency fund in place before purchasing a home is crucial so that you can cover the cost of maintenance and repairs for things like appliances breaking, broken windows, and basements flooding. Even with homeowners insurance you still have to pay a deductible, and the higher the deductible the less you’ll have to pay in premiums, and the less likely you’ll be to make an insurance claim, which you should avoid doing if you can. (Make insurance claims only when you’re facing a substantial loss. If you make claims too frequently, your insurance company may drop you, and other companies will also be less willing to insure you.)
  • You have a strong down payment. Preferably, your down payment should be 10 to 20 percent of the purchase price—and the closer you can get to 20 percent, the better.
  • Your house payment would be no more than 25 percent of your take-home pay. This means that your monthly mortgage payment will be no more than one-fourth of your income after taxes and (preferably, to help you not be stretched financially) after tithing or charitable giving if you give a significant amount of money to charity.
  • You’re planning to stay in the area for a decent length of time. If you want to buy a home, it’s best if you can plan to stay in the home for at least five years (and longer is often even better) so that you can gain some equity. When you buy a home you’ll likely pay several thousands of dollars on closing costs, and because of front-loaded amortization you won’t be paying much toward your principal for the first several years.
  • You’re not planning on your income or that of your spouse going down significantly during the term of the loan or of one spouse leaving the workforce. I’ve seen several situations where a young couple bought a home fairly comfortably because they were both working and included both of their incomes on the mortgage application, and then things became very tight financially when one spouse decided to leave work or work part-time to be a stay-at-home parent. That, or one spouse was not able to leave the workforce or significantly reduce their hours as they would have liked to because of a burdensome mortgage payment.
    For this reason, I highly recommend that you obtain a mortgage using the income of just one spouse (that is, that you buy a home that you can afford to pay with the income of just one spouse) in case one spouse loses a job, wants to become self-employed and needs money to start the business or will need time to grow the business to the point where it will earn significant income, or decides to leave work to stay home with children or elderly parents. Please don’t get sucked into the trap of wanting a large, fancy home at the expense of other potentially more meaningful benefits that can come with being able to afford your mortgage on just one income. #freedom
  • You’re handy with tools or are willing to shell out money for maintenance and repair costs. When you trade being a tenant for being a homeowner you also take on all of the work that comes with maintaining and repairing not only the home but the systems (such as water, sewer, electrical, and so on), appliances, and landscaping that come along with it. Be forewarned—you might experience a little shell shock at how expensive things can get!

Again, for many people, purchasing a home is a good financial move. One of the reasons for that is that you can save money buying over renting in the long run because in many cases rent continues to go up every year or at least every couple of years, but your house payment is set for the length of your mortgage term—15 or 20 or more years. And once you pay off your mortgage, you no longer have housing taking a significant chunk of your income every month. And that is a wonderful place to be!

5. Negotiate the purchase price of your home to save money on housing costs.

Your home is almost certainly the most expensive thing you will buy, so negotiate the purchase price to try and get a better deal, especially if you’re in a buyer’s market (a time when home prices are relatively low and inventory is relatively high).

6. Postpone buying a home when prices and demand are high to save money on housing.

If you’re in a seller’s market or otherwise in a situation where home prices and demand are high, it may be a good idea to wait to buy a home for a year or more or at least until the busy summer selling season is over.

7. Refinance your mortgage to save money on housing.

If interest rates have dropped substantially since you purchased your home, consider refinancing your home in order to reduce your monthly payment and save money on housing expenses. If you can, shorten the length of your loan at the same time (don’t refinance for a longer-term loan than what you had left already—that’s just moving backward in the quest for financial independence and freedom!).

8. Pay off your mortgage.

One of the best ways that you can reduce your housing costs in order to save money on housing is to pay off your mortgage! And the peace of mind that comes with doing so is priceless.

One way that you can pay off your mortgage years earlier and save thousands of dollars in interest is to make biweekly payments instead of one monthly payment. Since many people receive biweekly paychecks, this is a very effortless way to save. Simply talk to your mortgage company to set up this payment method—don’t pay some company hundreds of dollars to do it for you when you can do it yourself for free!

You can also pay off your mortgage early by reducing the money you spend in other areas and applying that money to the principal on your mortgage. For example, if between slashing your grocery bill and reducing your money spent monthly eating out you could pay an extra $300 a month on a $180,000 mortgage, and you did that starting three years into your 30-year mortgage, you would save $44,486 in interest!

Or, it might be worth it, as mentioned above, to refinance your mortgage to a 15-year mortgage. If you are planning to stay in your home long-term, you should look into doing so. And if you want to build your own wealth and not the bank’s (because of factors such as front-loaded amortization), you should strongly consider living in your home long-term. 🙂

Another way to pay off your mortgage earlier is to sell property or possessions and put the money toward the mortgage principal. If you have, for example, a large piece of property and have the option to do so, consider selling part of the land and paying down and refinancing or paying off your mortgage.

Read this article for more information on how to pay off your mortgage early and reasons that you should.

9. Get a roommate or roommates to save money on housing expenses.

Another way that you can potentially save thousands of dollars a year on your housing expenses is to get one or more roommates. If you only currently need two bedrooms for your family and you live in a four-bedroom home, for example, then there are two extra rooms that you could rent out. Especially in high cost of living areas, this could really bring in a substantial amount.

10. Rent out a spare bedroom or bedrooms on Airbnb or Booking.com.

If you have one or more extra bedrooms in your home (or have a second or vacation home), renting them out on Airbnb, Booking.com, and similar sites can potentially be an even better way to earn extra income. We’ve been using Airbnb for the last couple of years for virtually all of our travel accommodations (when we’re not camping), and they’re awesome. The hosts have been so great, and we’ve really felt welcomed and at home. And of course the savings can be substantial! Sign up for Airbnb here and receive $40 off your first stay with them!

And I just have to include a shameless plug for my angel mother, who has been renting out spare rooms in their beautiful southern Utah home (not an affiliate link :D) for the last couple of years. If you’re in the area to play at Lake Powell or hike in one of the beautiful national parks (such as the Grand Canyon) or other scenic areas nearby, look them up!

11. Rent out a spare room (or two, or more) for storage space.

Referred to as the “Airbnb of storage,” places like Neighbor, Store with Me, and Store at My House can be another great way for you to earn extra income from your home. If you don’t want to have to worry about being a host for guests but have empty bedrooms or storage areas in your home, you should look into this peer-to-peer storage option.

12. Move in with family or friends to save money on housing expenses.

If your budget is really tight and will likely stay that way for a while (if you’re in school for example, or looking to transition jobs or things like that), you might consider moving in with family or friends to save money on housing costs, if you have the option to do so. Especially if you have had some financial setbacks or just need to get to a more financially stable place in your life, this might be a viable option to help you get there. Just make sure there are clear expectations on all sides in order to mitigate potential problems as much as possible.

13. Save up a larger down payment to save money on housing.

Another one of the best ways to save money on your overall housing costs is to save up a larger down payment for your home. If possible, you should save up to have a 20 percent down payment in order to avoid private mortgage insurance (PMI) and a potentially higher mortgage interest rate. The more you can put down, the less you money you will pay in interest over the length of your loan, and the more equity you will have in your home when you decide you are ready to sell.

14. Consider the 100 percent down payment plan to save a ton of money on your housing expenses in years to come.

I know that saving up to be able to purchase a home with cash would require a great deal of patience and diligence, and I realize that many financial people would say that doing so is not even wise because you’re missing out on leveraging other people’s money. Nevertheless, I’m going to recommend you at least consider it if you’re in a financial situation where you could save up the money in, say, five to seven years.

So let’s say you and your spouse are newlyweds and new college graduates, and you make $90,000 a year between the two of you. And let’s say you sacrifice a little to rent a cheap two-bedroom apartment for $600 a month. And you keep your other living expenses low and pretend you’re still broke college students, and you live on $40,000 a year (including paying taxes and tithing or charitable giving) so that you can save $50,000 per year. (I know that would likely mean reducing or entirely postponing retirement saving until you purchased the home with cash, but even that tradeoff I feel is worth it if you then get after it and invest 15 percent or more of your income toward retirement once you purchase your paid-for home!) So let’s say you kept your expenses low and saved up for five years. After that five years, you could buy a $250,000 home for cash! Now, maybe after a few years you have a sweet kiddo or two that gets thrown into the mix, but that’s OK, because you also get raises and maybe even a promotion because you’re diligent, hardworking souls. And maybe a grandma or dear family member or friend is willing to watch the little cherub(s) you have for free or for cheap.

So yes, you would need to be patient and diligent and very intentional with your money in order to save that $50,000 a year and to do it for five years or more. But then you could never have a mortgage payment! Never pay interest to the bank! Never have to worry about possibly missing a mortgage payment if an emergency or financial setback occurred. Never have the possibility of potentially even losing your home if something happened and you were unable to make the payments for a time. Can you imagine how incredible that would be?

Can you contemplate the strong financial position that would put you in, to be able to invest what would have otherwise been your mortgage payment, and to be able to potentially invest that amount for the rest of your career? That’s what I call financial leverage. Because without a mortgage, you could then invest the money that would have gone toward a mortgage (and maybe even some additional money on top of that) in good stock mutual funds in retirement accounts and nonretirement accounts, if you max out your available retirement accounts.

Read about how to purchase a home with no mortgage, using the 100 percent down plan!


Save Money on Home Maintenance and Home Repairs

Another area where you can end up spending a lot of money as a homeowner is on regular home maintenance and repairs. Fortunately, there are some things you can do to reduce the amount that you spend on home maintenance.

15. Take care of needed maintenance when a problem first occurs to save money on housing.

One important way to save money on your home maintenance and repairs is to take care of issues before they get worse (and potentially very costly!) or, if possible, to prevent the problem in the first place. So that means doing things like cleaning out your gutters, replacing your furnace filters, fixing leaks, and so on.

16. Shop around when hiring contractors for home repair and renovation projects to save money on housing.

Especially for relatively expensive repairs or renovations that cost several hundred or even several thousand dollars, it’s important to shop around! Don’t just go with the first person you call. We know from experience that the amount you are charged for electrical work, plumbing, and other home maintenance can vary drastically from company to company, so do your homework by calling around and getting several companies to give you solid estimates before you decide on someone to do the work.

17. Do home renovations on the cheap to save money on housing expenses.

One way to save money on home renovations and home maintenance projects is to buy less-expensive furnishings and appliances and construction materials and, even more than that, to do the work yourself if you are able. (YouTube is your friend if you are somewhat mechanically inclined but just don’t know how to do something!) You can get used or lower-end furniture and appliances from thrift stores or Habitat for Humanity ReStore for much less than original retail. And if you use Craigslist or online classified, you can even often get things for free!

18. Redo your landscaping to be xeriscaping or low-water consuming.

Though you will have to pay some money up front (unless you can get all of the materials for free and do the work yourself—see the section just above) to do the work, you can save a good amount of money on your water bill by going with low-water-consumption landscaping. So if you’re going to be in your home for a good long while and especially if you’re in a dry climate, consider xeriscaping or similar options, and both Mother Nature and your wallet will thank you!


Save Money on Utilities

Another great way to save money on housing costs is to lower your utility bill.

19. Turn down your furnace and turn up your AC to save money on housing expenses.

One of the easiest things you can do (and doing so is free!) to save energy so that you can save money on your utilities is to turn down your furnace during the winter and turn up the temperature for your AC during the summer. To be most energy efficient, set your furnace at 62 degrees or lower during the winter, and set your air conditioner to 78 degrees or higher during the summer.

If you can, use fans or an evaporative cooler instead of an air conditioner, as they generally use only about one-third of the energy of central air.

Keeping the thermostat on a more economical setting may mean wearing warmer clothes (even inside) during the winter and wearing cooler clothes during the summer, or maybe having fans on or finding other ways to stay cool during the summer (like these great neck coolers). It may mean being just a little bit uncomfortable some of the time. But you’ll sure notice a difference on your monthly utility bill as you are able to save energy!

20. Give your furnace and AC a tune-up, and replace the filters regularly to save money on housing costs.

To keep your HVAC system running efficiently, have it tuned up and maintained regularly, and replace the filters as needed.


21. Buy a programmable thermostat to save money on housing costs.

Another big tip for how to save money on your electric bill is to buy and use a programmable thermostat. Programmable thermostats can give you a good return on your money spent because they allow you to effortlessly set the thermostat higher (during the summer) and lower (during the winter) when you’re sleeping or away from your home while at work or even on vacation (if you’ll return on a weekend day, for example, when you might have the thermostat set differently than you would for a weekday).


22. Install ceiling fans throughout your home to save money on housing costs.

Install ceiling fans throughout your home to help keep heating and cooling bills down. Ceiling fans will help keep things cool in the summer and even help keep your home warmer in the winter by pushing the warm air (which tends to rise) down.


23. Wash your clothes in cold water to save money on housing expenses.

Washing machines have improved so much in recent years that even washing your clothes in cold water will get them clean, so why not bank the savings?

24. Use your dishwasher less to save money on housing costs.

Wait until your dishwasher is full before doing a load of dishes, and if you have only a few dishes, quickly wash them by hand and put them in a rack to dry. Or simply choose to do the dishes by hand most of the time, like we do.

25. Make other changes for energy efficiency.

There are many relatively inexpensive things you can do around your home to improve its energy efficiency. For example, you can caulk around your windows and put weather stripping around your doors. Or spend more money and replace old windows (especially if they are single pane) or drafty doors. When old appliances wear out, replace them with (gently used, if you’re willing) energy-efficient models.

26. Cut your home phone line if you still have one, or switch to a super cheap home phone option like ObiTalk, Ooma, or Magic Jack.

We’ve used Magic Jack in the past for home phone service, which worked quite well, and we are now using ObiTalk. With ObiTalk you pay just a one-time cost for the equipment (we paid about $50 on Amazon for our Obi device), which is a small device that you plug into your modem. And now we have a dedicated home phone that we can use (over the internet–VOIP) without ever having a monthly or yearly bill. It’s awesome! Magic Jack was a good product, but with it you had to pay a yearly fee of about $30. Not bad at all, but still more than the $0 per year payment we have now. 🙂 ObiTalk has worked great, so if you would like to keep or go back to having a dedicated home phone (for the kids’ friends to use to call them, for example), check them out! If it keeps you from adding an additional cell phone line for kids, it will be well worth it (very possibly in more ways than just financially).

For even more information on how to save on your utility bill, read this article.


Save Money on Homeowners and Renters Insurance

Another important way to save money on your housing expenses is to reduce the amount that you pay each month or year in homeowners or renters insurance. Read below for 7 strategies you can follow to lower this monthly (or yearly) expense.

27. Shop for less expensive homeowners or renters insurance to save money on housing.

In order to save money on your housing costs, it’s ideal to reshop your insurance policies every year, but at least reshop them every couple of years or every few years to make sure that your coverage still meets your needs and that you’re still getting the best deal for the coverage that you have. To find great homeowners or renters insurance, I recommend Zander Insurance. They’ll shop around among a bunch of difference insurance providers to help you find the best rate for the coverage that you need. Visit their website to learn more information.

Renters insurance protects your possessions in case something happens like a fire, flood, or theft. Because in most if not all cases, your property owner’s insurance policy will not cover your belongings in the event of damage or loss. If you rent and you don’t have renters insurance, look into it to see if it makes sense in your situation. If you don’t have any or many possessions that are very valuable, then you might not need it, but it’s also pretty inexpensive coverage to buy.

28. Increase your insurance deductible to save money on housing.

One way you can lower your insurance premiums (for virtually all kinds of insurance) to save money on your housing expenses is to increase your deductible, or the amount that you pay out of pocket before the insurance company kicks in their portion. You should have a high deductible so that you save money, but more important, to discourage you from making frequent claims on your insurance coverage. Because if you make too many claims, your insurance company will likely drop your coverage because you will be seen as too high risk. And because of the CLUE (Comprehensive Loss Underwriting Exchange) report, which is a report of your claims made that is stored in a database shared by insurance companies, it will likely be harder for you to then get coverage from other insurance companies, as well. The saying is that your deductible should be high enough that you never want to use it, so our homeowners deductible, for example, is $2,000.

29. Get a home security system to save money on housing.

Another way to lower your homeowners insurance to save money on housing costs is to install a home security system, as most insurance providers will give you a discount on your rate if you do. And you can get a good alarm monitoring system for a great price these days. We use SimpliSafe. They provide a low-cost, no-contract alarm monitoring service that doesn’t require a home phone service and that has great customer service and great reviews. We’ve been using them for almost eight years now, and we pay just $14.99 a month total. They also offer video surveillance and text alerts. They’re a great company, so check them out.

30. Install smoke detectors and a carbon monoxide detector.

You can also save money on your homeowners insurance is to install smoke detectors and a carbon monoxide detector in your home, as most insurance companies will offer a discount if you do.  

31. Bundle with your auto insurance, life insurance, or other policies to save money on housing costs.

You can often save a significant amount of money on housing costs by bundling your insurance policies. So, for example, if you have auto insurance with a particular company, such as USAA (the company we use), then if you purchase homeowners insurance with them as well, you will get a discount on both your homeowners insurance and auto insurance. And if you purchase life insurance, as well, then you would receive a discount on all three!

For information on how to save on your auto insurance, read this article. And you can also learn more here about how to reduce your automobile and transportation costs.


32. Maintain a good credit score to save money on housing costs.

Another factor insurance companies look at when determining your insurance rate is your credit score, so that is another reason to maintain good credit. That doesn’t mean that you have to go and get one or more credit cards or a car loan or anything like that—it just means that when you do have debt or if you do have a credit card, pay on time (or preferably, early) every month, and keep your credit card balance low (generally 30 percent or less of the credit limit, to keep the best credit rating). And keep the overall amount of debt you have reasonable, in line with your income and other expenses.

To ensure that you are receiving the best rate possible and that nothing is amiss with your credit report, be sure to monitor your credit report by going to annualcreditreport.com and reviewing your credit report from the three credit bureaus as least once per year.

33. Get other discounts to save money on housing.

There may be other ways you can reduce your homeowners insurance premiums in order to save money on housing expenses, so ask what discounts are available when you call companies to shop around, because they might not think to mention all of the discounts that are available that you might qualify for. For example, you might receive a discount if you don’t have any insurance claims (or haven’t for a certain number of years), if you are a member of a homeowners association (HOA), or if you pay your premium in full each year (as we do) rather than paying month to month.



For many people, housing costs are the biggest bite out of their monthly budget. Owning or renting a home often is expensive, especially in high cost of living areas. But one of the best ways that you can save money on housing expenses is to be diligent over time and pay off your mortgage. When you do, that huge chunk of change that was going to the mortgage company can go to your own retirement, college expenses or savings for your kids, other wealth building, or even fun money (though I would recommend you invest a significant portion of it, rather than just spending it every month :)). You can also save money by renting out space in your home, saving money on your utilities, doing timely maintenance, keeping your homeowners insurance premiums down, and following the other ideas listed above.

 What have you done to reduce your housing costs that has had the greatest impact? Would you consider selling your much-loved home and downsizing to be mortgage-debt free sooner? What did I neglect to mention? Leave a comment and let me know!

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