Davelj, when does it make sense, though, even with those assumptions, to pencil out as an investment?
[quote=davelj]
when calculating the interest-only payment I’d use (…) the RATE assuming 20% down (but applied against the entire cost of the house – as if you’re putting zero down). Hope that makes sense. And, this is looking at buy vs. rent, not looking at it as an investment. Just to be clear.
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Thanks, Dave,that is actually a good and simple way to calculate – using the best rate (at 20%down) but with the loan value = sales/purchase price (like a 100% LTV).
If you figure out what mortgage payment WOULD be with the assumptions above (the good rate,but the whole purchase price loan), for an investment I guess you want to be at least a couple hundred bucks better off paying that THEORETICAL P&I and HOAs and MRs than rent income – or HOW MUCH MORE? (assume no PMI, because you WILL put 20% down at least). In REALITY, one would put 20% down, on which he would lose any return, even a safe 3%, but get a lower total P&I. Or there isn’t a rough number?
