Renting vs Buying - Which Is Better For You?
Can't just listen to your parents about everything. Everyones financial situation is unique, and especially if you have to borrow money to buy a place you want to understand if buying or renting is a better decision for you. Renting also provides flexibility to move or relocate, easier than if you have to sell out of a property. Renting will cost you to lose out on appreciation of the property, but the money saved and invested will usually out pace the properties appreciation 99% of the time.
Costs of Owning vs Renting:
Transaction costs - ( inspections, appraisals, closing costs)
Broker fees (either upon buying or selling)
Down Payment (cash is no longer available to be invested or used)
Property Taxes
Home Owners Insurance
Mortgage interest (if you take a mortgage)
Repairs and maintenance (real costs, don't pretend things don't break)
Association / Condo fees (depending on property)
Renting costs:
Rent
Security deposit (refundable)
Broker fee
Renters insurance
To find out which is better for you, add up all the costs and divide by the number of months you'll be living somewhere.
My spreadsheet
https://drive.google.com/file/d/0B0ro...
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