Entrepreneurs - should you work from home or rent an office?

If you’re a new entrepreneur facing the big decision – should you work from home or rent an office – there are some important points to consider to make the right decision. As you think about the pros and cons of each, remember that the details of your particular business as well as your own personality will determine which is best for you.

The Cost

The cost is a con for the rental office. The cost of renting an office may put you off entirely, so you have to consider whether the benefits make it worth the cost, or necessitate the cost. You will be able to claim the rental as a business expense when you file your taxes which will help, but do you have enough income stream (yet) to cover the rent in the first place? If profits are low to nil as you start out your entrepreneur business, you may need to work from home at first. Another option may be finding someone to co-share the office (and rent) with.

The cost is a pro for the home office, because you already pay for the same space to live in anyways, and when you have a home based business you will probably be able to claim a certain percentage of your home expenses as business expenses for tax deductions. These can include rent/mortgage, utilities, internet/phone and possibly more, be sure to check with your accountant or local tax laws and keep receipts and files for your tax deduction claims. Saving on office rental and on home expenses through taxes is a double savings bonus for the home office.

The Commute

The second obvious downside to working in a rental office is the commute. You may not be able to get a rental office close to your home, and you may not want one close to your home if it would be more beneficial to your business being in a central, urban location and you happen to live in a less central location.

Commuting takes precious time away from our work and personal schedules, and we all know that time is money. Unless you can be productive during your commute or using the time to relax (as some are able to do on a quiet train ride for example) then commuting is more time wasted.

With your home office there is no commute, saving you time and money in transportation. Using public transportation, or driving and using more gas, possibly with more expensive auto insurance for longer distance or more usage, are added expenses of the rental office that a home office can avoid.

Will you be able to get a rental office close to your home, so that it will take less time and money to get there? Where is the best physical location for your business? Depending on the type of work you do, your office might need to be in an urban area, and some distance from your home. Does your office need to be in a high traffic area, central location, easily accessible by public transit? If you have a lot of client meetings in your office, or would rely on walk-in business, then your office will need to be easily accessible and visible. If a centrally located rental office will help your business, it could be worth the extra commute time.


The rental office could be better for client and networking interactions in terms of not only accessibility, but also professional appearance. Working from an office could lend your business (and you) more credibility, more trust, and consequently more business. It depends if you will be working with clients or your network in person on a regular basis. If you primarily work online or on the phone, the professional appearance of a rental office is probably a moot point.


Another benefit of the rental office to consider is that it will probably offer you fewer distractions than a home office would. You are there with your desk, computer and phone, you have paid to be there and you are there to work. Sure there are plenty of internet videos and social content to distract you, but there’s no housework, TV, pets/kids and all the other stuff at home as well. You may find that you are able to focus better and take your work more seriously from a rental office that you have to pay for.

Have you ever worked from home before, and did you get easily distracted by home tasks or items? If not, do you think you would? Think about your personality as well as your home environment. Are you someone who get easily distracted while working? Is your home a clean, low clutter and low distraction environment? If not, you will need to set up your home office and keep the door closed, or you may need to work in a rental office instead.

The Attire

You could work in your PJs from a home office. Except for the times when you have clients come to your home office, you can wear regular clothes and not have to purchase so much expensive business attire.

When you work in a rental office, you will need to wear business attire every day because you will likely have more personal interactions with clients and strangers. You need to keep a professional appearance with your clothing and styling your hair etc., so this will cost more time and money to maintain.

The Separation

When you work in a rental office, you are able to lock up at the end of the day and switch over to personal time, perhaps more easily than if the work is sitting in your home, nagging at you to be done. Having a physical separation between your work and your home may be essential to the success of both your business and personal life. You do not want to burn yourself by working constantly.

With a home office, it might be harder to ignore the work during off hours and you could end up working more than you really should, your personal life and relationships will suffer. Overworking is not good for you or your business, so if you cannot keep out of your home office you will need a rental office. (If both situations are keeping you working late then you probably need to delegate and hire help).

The Other Separation

When I say the other separation, I am talking about the separation of yourself from society, from social interaction, when working from a home office. Some days you may never leave your house at all and you may never interact with another human in person, which can be lonely and boring.

Working in a rental office you are much more likely to have social interaction, from during your commute, to meeting with clients, to going out for coffee or lunch. You get some fresh air, some conversation, and some interesting diversity to your day.

If working in a home office leaves you feeling like a shut in, make sure you are still leaving the home at least once a day. Take a walk break for fresh air or meet a friend for lunch to break up the work day, or plan social activities for after your working hours to keep you connected and get you out of those walls.

  • Do you have any of your own points to add on home office versus rental office?
  • Did you choose to work from home or rent an office?
  • How did you justify your choice and if you’ve already started, how is it working for you?

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