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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