Rent Versus Buy – The Real Cost of Renting!

 

Being in real estate I hear Realtors talking all the time that it’s better to own than rent.  I know that the general population thinks we say that just ’cause we want to sell more houses.  So let’s take a REAL LOOK at why it is better to own than rent.

Set the stage:  The average price (mean) of a home in San Antonio, Texas is $156,000.  Given 30 years at 12 monthly payments on an FHA loan at 3.85% (today’s market rate for outstanding credit score) compared to a rental payment of $1250 (including rental insurance).

Using my handy dandy rent v. buy calculator I get the following results in a full comparison:


Estimated Savings with Ownership vs. Renting
Number Of Years To Compare:   10
 
Concerning Rent: (Scenario One)
Rent Amount Per Month:   $1,200.00
Monthly Renter’s Insurance:   $50.00
 
Concerning Home Ownership:
Purchase Price:   $156,000
House’s Appreciation Rate:   1%     (very conservative rate)
State & Federal Tax Rate:   .25%  (federal income tax rate varies)
Loan Amount:   $150,540.00
Interest Rate:   3.85%  (today’s rates for prime credit scores)
Number Of Years:   30
Discount Points:   0%
Origination Fee:   1%
Other Loan Costs:   $1,000.00
Annual Property Taxes:   $4,200.00
Annual Maintenance Costs:   $1,000.00  (varies by owner)
Annual Homeowners Insurance:   $100.00
Selling Costs:   6%   (varies by Realtor)
 
RESULTS
Total Rent Per Month:   $1,250.00
Total Rent:   $150,000.00
 
Monthly Principal & Interest (PI):   $1,063.74
House Total:   $140,154.67
 
Selling Price:   $172,321.05
Total Tax Savings:   $235.36
Equity At Time Of Sale:   $54,324.51
Money Saved Through Home Ownership:   $38,760.61

Owning a home would cost $48,605.94 less than renting.

 

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5511 Township Line Rd, Waynesville, OH – Virtual Tour

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We Will Sell Your House, or ERA Will Buy It
Search entire Cincinnati MLS
West Chester/Liberty Twp Home Search
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Donna Deaton
ERA Real Solutions Realty
513-313-9200
deaton.ds@gmail.com
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5877 Ethel Ave, Franklin, OH – Property Website

 

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FREE List of Foreclosed Homes for Sale
We Will Sell Your House, or ERA Will Buy It
Search entire Cincinnati MLS
West Chester/Liberty Twp Home Search
Mason Home Search
Trenton Home Search
Hamilton Home Search
Cincinnati Luxury Homes
Donna Deaton
ERA Real Solutions Realty
513-313-9200
deaton.ds@gmail.com
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5877 Ethel Ave
Franklin, OH
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Lender owned. Cheaper than Rent!

$ Click for current price
2 BEDROOMS
1 BATHROOMS (1 full)

Look at this…definitely cheaper than rent. Private setting. Lender owned. AS IS. Buyer must rely on own inspections. $500 earnest money, preapproval/proof of funds must be submitted with all offers. Allow 3 business days for response.

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