Rent vs Buy?
Rent vs Buy
What makes more sense? If you are staying in a town for work or family or just because you like the location, this is how you know whether it is smarter to Rent or Buy. There are a number of opinions on the web. Zillow has an interesting take on it. They make some assumptions I wouldn't though. For example their analysis assumes a renter is currently investing their down payment money at 5%.
I like to compare renting which generally covers maintenance, big repairs, sometimes utilities against the cost of owning with a monthly mortgage, property taxes, insurance, mortgage insurance and utilities.
If the question is not one of flexibility and mobility then financially, if you pay $2,600 / month in rent it makes sense to buy a home and start paying off your own home instead of your landlord's rental. Other times you are money ahead by renting. Contact us if you are thinking of making a move. We'll help you think it through.
Start with a free app named Karl's Mortgage on your phone. A typical purchase has 10%-20% down payment, as of 5-26-2020 interest rates are 3% on a 30 year fixed, this will vary. Taxes vary but 1% of price per year will get you close and home owner's insurance is roughly .03% per year of price.
On the home at 1352 Northern Ct, with a sales price of $640,000 and $20% -$128,000 down this would be approximately $2,725/month.
Principle and Interest: $2,158/month
Taxes and Insurance: $567/month
Total: $2,725
Notice How much principal you pay down each year! Basically you are taking the money from your bank account pocket and putting it in your home equity pocket!
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