Buying a Home is Cheaper Than Renting?

April 24, 2013

buying is cheaper than renting in san diego county

Buying a home is 44% cheaper than renting in America’s 100 largest metro areas, according to a recent study by Trulia.

The savings accrued when buying as opposed to renting varied upon location. Buying is less than half the cost of renting in 46 of the 100 largest metros. The lower saving rates were in California and New York and the highest were in the Midwest. The savings varied from 19% in San Francisco to 70% in Detroit.

Those areas with a higher savings rate include Memphis (62%), Kansas City (60%), and Indianapolis (58%). Those areas with a lower savings rate include Los Angeles (35%), New York (26%) and Honolulu (23%).

The report’s calculation assumes a 3.5% 30-year fixed-rate mortgage, 20% down, itemized tax deductions at the 25% bracket, and the buyer staying in the home for seven years. Trulia provides an interactive map that reveals how the savings change under alternative scenarios. For example, if a homeowner does not itemize (many homeowners do not), the average savings goes from 44% to 35%.

The report factors in many considerations, such as maintenance, insurance, taxes and the fact that the average home for sale is 47% bigger than the average rental unit. You can scroll down hereto review a detailed analysis of the report’s methodology.

If you would like more information about the cost of buying versus the cost of renting, please contact me today.

Thanks to our Guest Blogger ~ Carolyn Plummer from Prospect Mortgage. Follow her blog at: www.MyProspectMortgage.com

Loan inquiries and applications in states where I am not licensed will be referred to a Loan Officer who is licensed in the property state. Equal Housing Lender. Prospect Mortgage is located at 15301 Ventura Blvd., Suite D300, Sherman Oaks, CA 91403. Prospect Mortgage, LLC (NMLS Identifier #3296) is a Delaware limited liability company licensed by the Department of Corporations under the California Residential Mortgage Lending Act and operates with the following licenses: AK Mortgage Lender/Broker License #AK3296; AZ Mortgage Banker License #BK0903027; To check the license status of your CO mortgage broker, visit www.dora.state.co.us/real-estate/index.htm; Georgia Residential Mortgage License #16984; Illinois Residential Mortgage Licensee #6424; Kansas licensed mortgage company; MA Mortgage Lender/Broker License #MC3296; MS Licensed Mortgage Co.; MT Residential Mortgage Lender Licensee #120; Licensed by the NH Banking Dept.; Licensed Banker-NJ Dept. of Banking and Insurance #9932414; NV Division of Mortgage Lending Mortgage Banker #1173 and Mortgage Broker #3095; Operates as Prospect Lending, LLC in NY located at 711 Westchester Avenue, Suite 304, White Plains, NY 10604 (Licensed Mortgage Banker – NYS Department of Banking); OR Mortgage Lender Licensee #ML-2006; PA Dept. of Banking license #22122; RI Licensed Lender #20021343LL, Loan Broker #20041643LB; licensed by the VA State Corp. Commission as MC-2195; Washington Consumer Loan Company License – CL-3296. This is not an offer for extension of credit or a commitment to lend. Loans are currently being closed and committed at the expressed rates, however these rates may change or may not be available at the time of your loan lock-in, commitment or closing. All loans must satisfy company underwriting guidelines. Information and pricing are subject to change at any time and without notice. This is not an offer to enter into a rate lock agreement under MN law, or any other applicable law.

 

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