Ep 129_The Real Cost of Owning Vs Renting a Home
Ep 129_The Real Cost of Owning Vs Re
Today I discuss why buying a home is infinitely more advantageous than renting, all things being equal.
Positives of home ownership:
equity
capital appreciation
tax advantages
control
Positives to renting:
no upkeep
you’re free but poor
rent builds nothing
Example: $ 100,000 house
@ 4% on a 30 yr mortgage…
you pay around 500 a month
renting that same house, you’ve just blown $120,000 over ten years
after 10 years, you have 22 k in equity if you buy
Add to 22 k the extra 500 a month you’re saving on a mortgage vs renting (500 mortgage vs 1,000 in rent a month)
That’s 60 k over 10 years in extra cash.
So…
60 k (500 x12x10)
+ 22k in equity
equals 82 k in real money in equity/cash
now add the 120, 000 the renter wastes in rent…
120000
+
82,000
=202,000
The renter has wasted $202,000 in opportunity costs over ten years.
See why renting sucks and building equity Works? Listen to the podcast and see for yourself.
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