Housing for Your Pastor: Parsonage or Housing Allowance?
"Should we continue to provide a parsonage and utilities or should we change to a cash housing allowance and let our pastor buy his own home?"
This difficult question is asked often out of genuine concern for the pastor’s dilemma at retirement, when he or she has no savings built up for a retirement home. The question becomes even more difficult to answer with the shift in the nation’s economy and in each local economic situation. While there is no absolute, authoritative answer, the following list of advantages and disadvantages, which have become apparent to pastors and churches through actual experience, is offered to stimulate careful thinking and evaluation.
Pro Parsonage and Con Housing Allowance:
1. In some situations, there really is little choice. The parsonage may be connected to or adjoining the church building with no alternative for selling or renting. Unless used for Sunday School rooms, it remains the pastor’s home.
2. Churches owning a parsonage may strengthen their ability to attract the pastoral candidate of their choice who may be unable or unwilling to buy a home.
3. In some areas, no property taxes are due on church-owned parsonages, which may mean less expense.