|
On 4 Jul 2006 19:08:09 -0700, "Tom" <mailtheisaacs@gmail.com> wrote:
>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
In the long term, real estate always goes up.
By the time the house is paid off, its worth will be several times
what you paid for it.
In the meantime, you can deduct your mortgage interest and your
property taxes.
Alan
who is enjoying being retired
and who's house is worth MUCH more than what he paid for it.
|
|
Re: Why buy a house?
