| O W N I N G |
R E N T I N G |
| EQUITY: Owning a home builds equity in real property. This translates into a good long-term investment and financial stability. |
Renting builds no equity and allows for no accrued future value. |
| TAX BENEFITS: Owning a home results in tax deductions. Mortgage interest payments and real estate tax expenses are some of the substantial tax deductions associated with owning a home. |
Renting merely results in one more living expense each year. |
| FINANCIAL STRENGTH: Owning a home helps build credit and shows financial integrity. Money can also be borrowed against the equity of the home when needed. |
Renting does not provide the benefit of financial stability pertinent to home ownership. |
| COST OF LIVING EXPENSES: Owning a home (on fixed rate mortgage) ensures a steady monthly payment. |
Rents can be raised, leases can be rejected, and the cost of living may increase. |
| INVESTMENTS: Owning a home, unlike many other investments, allows for the use of the investment while it is accruing value over time. |
Renting allows for no increase of value over time. |
| INDIVIDUALITY: Owning a home provides one with the freedom to choose the style, landscaping, colors and fixtures of one's own home. |
Renting limits one's choices and decorative freedoms. |
| SECURITY: Owning a home provides you with better security, privacy, credibility, and a stronger sense of community. |
Renting just doesn't compare. |
O W N I N G
COST AND INVESTMENT COMPARISON |
R E N T I N G
COST AND INVESTMENT COMPARISON |
| purchase price of home |
$130,000.00 |
purchase price |
$0.00 |
| loan amount @ 90% |
$117,000.00 |
loan amount |
$0.00 |
| monthly payment @ 8% /30 years |
$858.50 |
rent per month |
$1,000.00 |
| total payments per year |
$10,302.00 |
total rent per year |
$12,000.00 |
| |
|
|
|
| total itemized deductions 1st year |
$9,324.00 |
total itemized deductions 1st year |
$0.00 |
| appreciation in value of home @ 5% per year |
$6,500.00 |
appreciaton in value |
$0.00 |
| total advantage in 1st year |
$15,824.69 |
total advantage in 1st year |
$0.00 |
| |
|
|
|
| total itemized deductions in 5 years |
$45,742.07 |
total itemized deductions in 5 years |
$0.00 |
| appreciation in value of home @ 5% for 5 years |
$35,943.00 |
appreciation in value over 5 years |
$0.00 |
| total advantage for 5 years |
$81,685.07 |
total advantage for 5 years |
$0.00 |
