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"Tom" <mailtheisaacs@gmail.com> wrote in message
news:1152065289.677002.187940@m79g2000cwm.googlegroups.com...
> 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..
>
If your not planning on staying in the same place for an extended time,
closing costs and the uncertainty of the market would seem to favor renting.
Over the long term, if you're comparing the cost of buying versus renting
COMPARABLE houses, buying would make more sense because you're putting the
landlord's profit in your pocket. If your satisfied with a 1000 sq ft
apartment and considering purchasing a 2000 sq ft house the math gets more
complicated. In addition to the taxes and interest that you mentioned,
there are also higher insurance, higher utility bills, repair and
maintenance costs, initial furnishings, etc. And, while the home will
appreciate and mortgage payments are fixed, taxes, insurance, utilities and
maintenance expenses will continue to increase with inflation just like rent
while the mortgage interest deduction will drop as the mortgage is paid off.
I concluded that, IF I invested the extra monthly expense that a house would
require and continued to rent the smaller apartment, at the end of 30 years
my investment would equal the equity that I'd have had in the house.
So, to me, the finances are a wash and you're really just looking at the
life style advantages (and extra upkeep effort) of a house versus the
flexibility of renting and having cash instead of property. For right now,
I am happy with the flexibility of renting (and wishing I had bought while
interest rates and home prices were still at minimum :( ).
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Re: Why buy a house?
