Owning a Home Makes More Sense

Owning a Home Makes More Sense

Re-Published by: Christopher Tenggren – RE/MAX All Pro – St. Charles, IL – HomesInTheFoxValley.com (originally published and written by: The RESupermen at Niblock Company, REALTORS®), July 16, 2018

When comparing the cost of owning a home to renting, there is more than the difference in house payment against the rent currently being paid. It very well could be lower than the rent but when you consider the other benefits, owning could be much lower than renting.

Each mortgage payment has an amount that is used to pay down the principal which is building equity for the owner. Similarly, the home appreciates over time which also benefits the owner by increasing their equity.

There are additional expenses for owning a home that renters don’t have like repairs and possibly, a homeowner’s association. To get a clear picture, look at the following example of a $300,000 home with a 3.5% down payment on a 4.5%, 30-year mortgage.

The total payment is $2,264 including principal, interest, property taxes, property and mortgage insurance. However, when you consider the monthly principal reduction, appreciation, maintenance and HOA, the net cost of housing is $1,218. It costs $1,282 more to rent at $2,500 a month than to own. In a year’s time, it would cost $15,000 more to rent than to own which is more than the down payment and closing costs to buy the home.

With normal amortization and 3% annual appreciation, the $10,500 down payment in this example turns into $112,00 in equity in seven years. Check out your own numbers using the Rent vs. Own or call me at 630-408-2750. Owning a home makes sense and can be one of the best investments a person will ever make.

Credits to…

The RESupermen at Niblock Company, REALTORS® (Clark Niblock, CRS & Duncan Martin, CRS)
3211 Thrush Bend – San Antonio, TX 78209  210-493-7739
team@RESupermen.com   www.resupermen.com

Owning a Home Makes More Sense

Visit Christopher Tenggren’s Blog again soon at: http://HomesInTheFoxValley.com/blog



Speak Your Mind