Home › Forums › Housing › Good time to buy in 700k market ? › In this environment renting
In this environment renting makes a lot of sense. Let’s do the math:
Home price $700k, down payment $150k, mortgage $550k at 4% (30 yr fixed), property tax $8k, MR 3k. Monthly payments $3,500.
Possible drop in value over next 5 years: 10%=$70k. Annual drop $14k or about $1,200 a month.
Actual cost of owning a $700k over next 5 years $4,700 per month.
Tax credit (25% bracket): $450 per month.
You can rent a comparable home for about $2,500-2,800 per month. Savings at least $1,400 per month or $80 k over 5 years.
Conclusion: Wait and buy a house in 5 years!
