Rent v. Buy: What’s Better for You Right Now?

June 13, 2009

As is clear from the above, the long term value of buying versus renting is easy to show. But what about the short term? Well, due to price declines, tax benefits and exceedingly low interest rates, the Rent versus Buy equation – which went badly out of whack during the runaway Sellers’ market – has been coming much more into balance. Here is a sample calculation comparing paying $2600 rent with purchasing a $650,000 home. Since any calculation depends on one’s assumptions regarding inflation, appreciation, interest rates, down payment, term of ownership, and so forth, please feel free to use the calculator referenced to perform your own calculation.
Sample Rent vs. Buy Calculation

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