So here’s a quick rent to buy calculation for the venetian. Obviously this is just current data I found but it’s in the ballpark. Craigslist posting look like this place rents for about $1400/mo for a 1 bedroom. A recent comp for 1 bedroom in this complex is $235K and the lowest current 1 bed listing is $259/K. So let’s just assume you can get one for $250K.
You don’t have a big down so we assume FHA financing.
You take out a loan for $240K @ 4.5% which corresponds to principal and interest of $1216/mo. Then we add FHA MIP which is 4375/12 = $364/mo + taxes 2815/12 = $234/mo + $169/mo HOA. Let’s assume the HOA covers insurance. So to buy costs = $1216+364+234+169 = $1983/mo. Doesn’t seem like all that great of a prospect to buy, when you can rent the same thing for $1400/mo
Another way to think about it is this way. Say you buy it and pay the extra $600/mo to buy versus renting. Say you want to sell the place in 5 years. 1/1 condo in UTC probably isn’t your long term home. In 5 years you spend $36000 extra dollars to buy vs rent (granted rents could go up so it might be somewhat less than this). In order to break even in 5 years you need 2.5% appreciation per year. The place needs to be worth $290K at the end of that 5 year period. Anything less than that and it would have been better to rent. Anything more and it was better to buy.
