Renting vs. owning debate

christy Posted: Aug 06, 2003 06:20 PM

Renting vs. owning debate

Ok I am having a debate here with my poppa, he does not believe that my future mortgage payment is equivalent to rent payments. If I should be paying roughly 1300 a month for my mortgage...isnt that similar to what I would pay for a two bedroom apartment (in suffolk county)?

If you would like to share your rent payment or what you know others are paying please do. I dont think I am crazy here, I feel that this mortgage payment wouldnt be that bad, and that I could have been spending this in rent!

Karen H Posted: Aug 06, 2003 06:27 PM

Re: Renting vs. owning debate

I think you're in the ballpark for about a $250,000 - $260,000 mortgage loan with that amount depending on what interest rates are when you lock in.

What you're not taking into account are the taxes and insurance - add another $700 - $900 a month to cover those.

Of course you also get the mortgage deduction on your income tax return - not sure how to calculate what those savings are. And you are building equity in your own asset, not your landlord's assets.

Jenn524 Posted: Aug 06, 2003 06:37 PM

Re: Renting vs. owning debate

As far as cost goes, you're not going to win with a house. At a 6.5% rate for a $250,000 mortgage your monthly payment alone would be about $1,600. Then add on taxes and insurance and you're well over $2,000 a month. I don't know how much of a mortgage you're looking at but chances are after you add on taxes you'll be over the $1,300 mark.

But there are more benefits to having a mortgage than renting. Like Karen said you get a tax break and you're building your equity. Plus when you're ready to move you have something to put towards a down payment on your next house.

palebride Posted: Aug 06, 2003 06:40 PM

Re: Renting vs. owning debate

i think the fact that you're putting money into somethign rather than simply throwing it at a landlord is all there is to think about! yes it might be more money monthly....but you're putting the money towards something, so its' better for your future
(wow, now i sound like MY dad!)

christy Posted: Aug 06, 2003 06:49 PM

Re: Renting vs. owning debate

Thanks for the feedback!

Cira Posted: Aug 07, 2003 09:24 AM

Re: Renting vs. owning debate

I agree with palebride if you can afford it. There are a ton of renting vs. owning calculators on-line. Check it out and see if owning would be better for you financially!

Sonicstef Posted: Aug 07, 2003 10:18 AM

Re: Renting vs. owning debate

In my area, you can rent an apartment for about 50-75% of what you would pay with a mortgage.

KarenK122 Posted: Aug 07, 2003 11:07 AM

Re: Renting vs. owning debate

I know my rent is ridiculous. I'm wayyyyy out in Suffolk and I pay $1800 for rent. Granted its a brand new townhouse complex, 2 bedrooms 2 baths, full kitchen, pool, fitness center and a garage (1400 sqare feet) but its still money down the tubes.

If I had the money for a downpayment we'd buy something in a second. We are getting no tax benefits from renting and with a house you can at least deduct your taxes and interest.

VickiC Posted: Aug 07, 2003 12:48 PM

Re: Renting vs. owning debate

We are similar to Stef. We pay $1000/month which includes everything except our telephone bill. For a mortgage, we'd be paying probably about $2300/month, which we can't afford to do right now.

jennbaby Posted: Aug 07, 2003 02:51 PM

Re: Renting vs. owning debate

Christy we pay almost that for a 2 bedroom but we are in Queens

Screw rent!

jennbaby Posted: Aug 07, 2003 02:53 PM

Re: Renting vs. owning debate

also had to add we would pay more but we live here a while!

ChristineC68 Posted: Aug 07, 2003 03:03 PM

Re: Renting vs. owning debate

I consider buying a house an investment. You make your down payment when you buy the house then years down the line you sell it and you get the return on your investment.

You will always have to pay to have a roof over your head (rent or morrtgage & taxes) and that is never money down the train. (JMO)

In this area mortages are ususally higher then rents even when you consider the tax breaks of mortgage interest.

I think it comes down to lifestyle choices.

Some people do not want the maintenance and repair responsibility of owning their own home.

Some people get satisfaction from owning and taking care of their own property.

Some don't want to dig in roots and like being able to pick up and move on short notice.

Scoop Posted: Aug 07, 2003 04:03 PM

Re: Renting vs. owning debate

We bought a 3 family house and live in one of the apartments. With the two other rents pretty much covering our mortgage....we put in less $ then if were renting.

One day...when we buy our dream house, we plan to keep this one as an investment.