Is It Better to Rent or Buy in Colorado Springs?

The short answer: Buying usually makes more sense if you plan to stay put for several years, have your down payment and closing costs covered, and can comfortably handle the full monthly cost of owning, not just the mortgage. Renting usually makes more sense if your timeline is short or uncertain, your job or orders could move you, or buying would stretch your budget thin. In Northern Colorado Springs, Monument and Black Forest, the answer also depends on property taxes, insurance and the kind of home you want.

By Brennan Wolff, Broker, Realtor®

If you're renting in the Colorado Springs area and wondering whether it's time to buy, you're asking the right question. You're also probably not getting a fully honest answer from most of what you read. Some of it makes buying sound like a no-brainer. Some makes it sound impossible. The truth is in the numbers, and they're different for everyone.

Here's how I'd think it through.

How long will you stay?

This is the biggest factor. Buying and selling a home both come with real costs, including lender fees, title and closing costs on the way in, and commissions and prep on the way out. It usually takes a few years of ownership before building equity outweighs those costs.

As a rough rule of thumb, if you expect to stay five years or more, buying deserves a close look. If you might move in two or three, renting often wins. Your actual break-even point depends on the price, your down payment, your rate and how the market moves, so it's worth running your own numbers.

A note for military families: If you're stationed at the Air Force Academy, Peterson, Schriever or Fort Carson, your orders shape this decision. Some families rent for a short tour. Others buy, sometimes with a VA loan, and keep the home as a rental after their next PCS. If you're considering that path, think about the home as a future rental from day one.

What does owning a home here really cost?

The mortgage payment is only part of it. When you compare owning to renting, add up the full monthly cost:

• Principal and interest on your loan
• Property taxes, including any metro district taxes, which are common in newer communities on the north end
• Homeowners insurance, which here reflects hail and, in wooded areas, wildfire risk
• HOA dues, if the neighborhood has them
• Mortgage insurance, if you put down less than 20% on a conventional loan
• Maintenance and repairs, which many owners budget at around 1% of the home's value per year. In Black Forest and rural Monument, that includes well and septic upkeep.

Then compare that total with your rent plus renter's insurance. That's the honest side-by-side.

What does renting really cost?

Renting has real advantages. Your upfront costs are lower, repairs are someone else's problem, and you can move with less hassle. If your life is still in motion, that flexibility is worth something.

The trade-off is that rent doesn't build equity, and you don't control increases. Each year your lease renews, the price can change. Over a long stretch, that adds up.

Does buying build wealth?

Over time, it often does. When you own, part of each payment pays down your loan, and if your home's value rises, that adds to your equity too. According to the Federal Reserve's Survey of Consumer Finances, the median homeowner's net worth in 2022 was about $396,000, compared with about $10,400 for renters, as summarized by the National Association of Home Builders.

That gap reflects other differences too, like age and income, so it isn't a promise. Home values can go down as well as up, and no one can guarantee what any home will be worth later. But paying down a mortgage is one of the most common ways people here build long-term wealth.

Are you ready to buy?

A few honest questions help:

• Is your income steady? Lenders will look closely at your job history, and you'll want a cushion beyond the payment.
• Do you have high-interest debt? Paying down credit cards or car loans first can improve your rate and lower your stress.
• Do you have your upfront costs covered? That means your down payment, closing costs and a reserve for moving and early repairs.
• Have you talked to a lender? A pre-approval tells you what you can borrow. Only you can decide what you're comfortable paying.

Is there help with a down payment in Colorado?

Yes. The Colorado Housing and Finance Authority (CHFA) and some local programs offer down payment and closing cost assistance for eligible buyers. A lender who works with these programs can tell you whether you qualify. Sellers and builders sometimes offer credits toward closing costs or rate buydowns, too. My post on builder incentives versus price cuts explains how to compare those offers.

Frequently asked questions

Is it cheaper to rent or buy in Colorado Springs? It depends on the home, your down payment and your rate. Renting is usually cheaper in the short term. Buying can cost less over a longer stretch once equity builds.

How long should I plan to stay before buying? Five years or more is a common rule of thumb, but your actual break-even depends on your numbers.

Should I buy if I'm in the military? It depends on your orders and whether you'd keep the home as a rental. Many service members here use VA loans, and some keep their homes after a PCS.

Do I need 20% down? No. Many loan programs allow less, though a smaller down payment usually means mortgage insurance and a higher monthly cost.

Want a straight read on your numbers?

If you're renting in Northern Colorado Springs, Monument or Black Forest and wondering whether buying makes sense, I'm happy to walk through what a purchase would actually look like for you, and how far out you might be if now isn't the right time. No pressure. Start with the Buyer's Guide or reach out to me directly.

This post shares general information, not financial advice. Talk with a licensed lender about your specific situation.

Sources: NAHB Eye on Housing, homeowner and renter wealth