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My wife and I are debating whether we should buy a house / condo /
townhome or just rent for a longer period..
We have been renting for over 5 years now.. and getting close to being
bored living in apartments..
BUT, when I do calculations, it never seems to make financial sense to
buy a house..
On a ~ 200k house inside / close to the loop, one pays ~ 3k / yr or
higher in taxes plus at around 6% mortgage, the interest alone is ~
$12k / yr. So an expense of $ 15k per year.. (I'm keeping the
principal repayment out of this as this is applied towards reducing the
loan amount and so not an expense)
Minus.. the interest deduction from one's income.. Roughly $4k saving
(at a 33% tax bracket)
So recurring expenses of about $ 11k. ($15k minus $4k) (plus
maintenance costs if in a condo/ townhome..et al)
I'm keeping the one time closing cost out of this for now..
So in effect.. Rougly, I'm talking about paying $1000 per month even
when I own a home..
I agree that this comes with the potential benefit of appreciation..
but historical prices in the Houston area has not shown any
appreciation for a while.. loong while.. and the market in Houston is
pretty much flat...
If I rent, I'll be paying $1k / month towards rent..
If I own a home, I'll be paying $1k / month towards interest /
property taxes..
Now if I add in the one time closing costs into the picture, ~ $15k..
then it does not make sense for me buy a home unless I plan to stay
there for at least 3 - 5 years..
So.. I'm requesting advise from all existing homeowners..
Why not rent a great place for $1.5k / month with all amenities taken
care of by the apartment folks rather than own and pay more?
I appreciate any and all comments.. Thank you..
Tom
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Why buy a house?
