Renting Vs Buying: Absolutely No Contest

[smshorttimer]

[quote=esmith][quote=cooprider]This is the best rent vs. buy calculator I’ve come across

http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html?_r=1&ex=1185336000&en=92a35496df194374&ei=5070&oref=slogin#
[/quote]

It is a good calculator BUT you have to go into “advanced options” and tweak a few things.

First of all, it uses 20% income tax rate by default, which is not applicable here. Anyone who thinks about buying in San Diego will have his last dollar taxed at around 35%.

“Costs of buying home” are 4% of purchase price by default – I think it should be lower.

[/quote]

I’m slow on these things. My federal tax rate is 15%. State is 9.3%? I take it your “35%” has something to do with tax breaks?

Most people here must be in the higher brackets; Homeownership tax benefits can be overstated. A couple earning 65K this year that is thinking about buying a place with $300 HOAs should thoroughly investigate the “tax benefits offset fees/taxes” thing. Do not take “offset” to mean “almost cancels out.”

[Eugene]

I’m slow on these things. My federal tax rate is 15%. State is 9.3%? I take it your “35%” has something to do with tax breaks?

35% is 25% or 28% federal (or 26% AMT) + 9.3% state.

There may be some prospective homebuyers like you in 15% bracket, but their number is low, for obvious reasons.

[Eugene]

I’m slow on these things. My federal tax rate is 15%. State is 9.3%? I take it your “35%” has something to do with tax breaks?

35% is 25% or 28% federal (or 26% AMT) + 9.3% state.

There may be some prospective homebuyers like you in 15% bracket, but their number is low, for obvious reasons.

[Eugene]

I’m slow on these things. My federal tax rate is 15%. State is 9.3%? I take it your “35%” has something to do with tax breaks?

35% is 25% or 28% federal (or 26% AMT) + 9.3% state.

There may be some prospective homebuyers like you in 15% bracket, but their number is low, for obvious reasons.

[Eugene]

I’m slow on these things. My federal tax rate is 15%. State is 9.3%? I take it your “35%” has something to do with tax breaks?

35% is 25% or 28% federal (or 26% AMT) + 9.3% state.

There may be some prospective homebuyers like you in 15% bracket, but their number is low, for obvious reasons.

[Eugene]

I’m slow on these things. My federal tax rate is 15%. State is 9.3%? I take it your “35%” has something to do with tax breaks?

35% is 25% or 28% federal (or 26% AMT) + 9.3% state.

There may be some prospective homebuyers like you in 15% bracket, but their number is low, for obvious reasons.

[smshorttimer]

Correct. I’m a bit out of my element. Thankfully people still bought homes in mid-2006.

[smshorttimer]

Correct. I’m a bit out of my element. Thankfully people still bought homes in mid-2006.

[smshorttimer]

Correct. I’m a bit out of my element. Thankfully people still bought homes in mid-2006.

[smshorttimer]

Correct. I’m a bit out of my element. Thankfully people still bought homes in mid-2006.

[smshorttimer]

Correct. I’m a bit out of my element. Thankfully people still bought homes in mid-2006.

[Anonymous]

35% is 25% or 28% federal (or 26% AMT) + 9.3% state

You also need to calculate your loss of standard deduction in there as well. Since I’m married, I’d lose about $5,000 worth of my federal standard deduction. Most planners seem to feel that property taxes and the deduction cancel each other out in most cases and base their calculations on that assumption.

[Anonymous]

35% is 25% or 28% federal (or 26% AMT) + 9.3% state

You also need to calculate your loss of standard deduction in there as well. Since I’m married, I’d lose about $5,000 worth of my federal standard deduction. Most planners seem to feel that property taxes and the deduction cancel each other out in most cases and base their calculations on that assumption.

[Anonymous]

35% is 25% or 28% federal (or 26% AMT) + 9.3% state

You also need to calculate your loss of standard deduction in there as well. Since I’m married, I’d lose about $5,000 worth of my federal standard deduction. Most planners seem to feel that property taxes and the deduction cancel each other out in most cases and base their calculations on that assumption.

[Anonymous]

35% is 25% or 28% federal (or 26% AMT) + 9.3% state

You also need to calculate your loss of standard deduction in there as well. Since I’m married, I’d lose about $5,000 worth of my federal standard deduction. Most planners seem to feel that property taxes and the deduction cancel each other out in most cases and base their calculations on that assumption.

[Author]

Posts