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Rent vs. Buy Analysis

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24 diapositives · 734 Views · Oct 01, 2014

Rent vs. Buy Analysis. Assumptions. Both Monthly Rent and Monthly Mortgage Payments are equal at $1,000 per month. Assumptions. Both Monthly Rent and Monthly Mortgage Payments are equal at $1,000 per month.

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Rent vs. Buy Analysis
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  1. Rent vs. BuyAnalysis

  2. Assumptions Both Monthly Rent and Monthly Mortgage Payments are equal at $1,000 per month.

  3. Assumptions Both Monthly Rent and Monthly Mortgage Payments are equal at $1,000 per month. On the Purchase side of the comparison, $1,000 is the total payment on $160,000 Home Purchase.

  4. Assumptions Both Monthly Rent and Monthly Mortgage Payments are equal at $1,000 per month. On the Purchase side of the comparison, $1,000 is the total payment on $160,000 Home Purchase. Any tax savings* on Interest, Real Estate Taxes or Private Mortgage Insurance will be applied to funding Maintenance on the home you purchased.

  5. Assumptions Both Monthly Rent and Monthly Mortgage Payments are equal at $1,000 per month. On the Purchase side of the comparison, $1,000 is the total payment on $160,000 Home Purchase. Any tax savings* on Interest, Real Estate Taxes or Private Mortgage Insurance will be applied to funding Maintenance on the home you purchased. Purchaser put 3.5% down payment, financing through a FHA Mortgage of $155,944 at 4% including $1,544 upfront financed PMI and Seller paying $4,053 in Prepaid Expenses and Closing Costs. (There are Down Payment Assistance Programs available).

  6. Renters may also need to purchase Renter’s Insurance.

  7. Break Down

  8. Break Down * * * *The Tax Deductibility in a 25% bracket X $712* = $178 per month. This Tax Savings may be used to offset the maintenance issues associated with owning a home.

  9. Annual Equity

  10. Annual Equity

  11. Annual Equity

  12. Annual Equity

  13. Annual Equity

  14. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. Certain short term situations may lend themselves better to rental options. Renting will put you in the RED

  15. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. • Instant Equity can be generated by purchasing a home below market value.

  16. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. • Instant Equity can be generated by purchasing a home below market value. • Sweat Equity can be generated by homeowner improvements

  17. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. • Instant Equity can be generated by purchasing a home below market value. • Sweat Equity can be generated by homeowner improvements • Nationally, as to Real Estate, there was a 6.4%average annual appreciation rate over a 44 year history

  18. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. • Instant Equity can be generated by purchasing a home below market value. • Sweat Equity can be generated by homeowner improvements • Nationally, as to Real Estate, there was a 6.4%average annual appreciation rate over a 44 year history • Tax Benefits are the deductibility of Interest, Real Estate Property Taxes, and Private Mortgage Insurance. There is no Capital Gains Tax on Appreciation Gains for homes occupied 2 of the past 5 years.

  19. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. • Instant Equity can be generated by purchasing a home below market value. • Sweat Equity can be generated by homeowner improvements • Nationally, as to Real Estate, there was a 6.4%average annual appreciation rate over a 44 year history • Tax Benefits are the deductibility of Interest, Real Estate Property Taxes, and Private Mortgage Insurance. There is no Capital Gains Tax on Appreciation Gains for homes occupied 2 of the past 5 years. • There is an Intrinsic Value to Pride of Ownership…The Homeowner can make changes to home or decorate according to their own desires.

  20. Notes • Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. • Instant Equity can be generated by purchasing a home below market value. • Sweat Equity can be generated by homeowner improvements • Nationally, as to Real Estate, there was a 6.4%average annual appreciation rate over a 44 year history • Tax Benefits are the deductibility of Interest, Real Estate Property Taxes, and Private Mortgage Insurance. There is no Capital Gains Tax on Appreciation Gains for homes occupied 2 of the past 5 years. • There is an Intrinsic Value to Pride of Ownership…The Homeowner can make changes to home or decorate according to their own desires. • Studies confirm that Home Ownership provides a positive correlation in enhanced Self Esteem, Educational Achievements, Civic Participation & Civic Crime Prevention.

  21. Notes Notes: Rents generally increase 3-4% annually and will double in approximately 18-20 years. Instant Equity can be generated by purchasing a home below market value. Sweat Equity can be generated by homeowner improvements Nationally, as to Real Estate, there was a 6.4%average annual appreciation rate over a 44 year history Tax Benefits are the deductibility of Interest, Real Estate Property Taxes, and Private Mortgage Insurance. There is no Capital Gains Tax on Appreciation Gains for homes occupied 2 of the past 5 years. There is an Intrinsic Value to Pride of Ownership…The Homeowner can make changes to home or decorate according to their own desires. Studies confirm that Home Ownership provides a positive correlation in enhanced Self Esteem, Educational Achievements, Civic Participation & Civic Crime Prevention. Buying will put you in the GREEN

  22. Notes Buying will put you in the GREEN Home Ownership over time is one of America’s most significant Equity/Estate Builders. The Equity can assist in Retirement by having housing paid for or even utilize as a Reverse Mortgage.

  23. Notes Buying will put you in the GREEN Home Ownership over time is one of America’s most significant Equity/Estate Builders. The Equity can assist in Retirement by having housing paid for or even utilize as a Reverse Mortgage. Buying will put you in the GREEN