Raleigh Rent or Buy Calculator – The Truth This Time

The eternal question: Should you rent or buy?  The internet calculators don’t consider this.  The pundits don’t either.  Why can’t they see the truth?

The calculators were out.  Others accessed online calculators with their smart phones.  Still others gazed into their crystal balls and predicted future real estate market trends.  Frank half listened.

You see Frank went to this cocktail party to please his wife.  Her sister married Mister Super Yuppie and Frank was getting to rub elbows with all his Yuppie friends.  Yippee!  Rent or buy was the topic of the evening.  Points raised:

Rent – They debated whether rents should be considered a bargain now.

Home Prices – The real estate meltdown makes this a good time to buy countered others.

Interest Rates – You can’t pass up these historically low interest rates.

Property Taxes – Owning meant paying property taxes.

Interest – Unless you paid cash, you’d pay almost as much in interest as you would for the house.

Tax Deduction – Interest paid could be used to lower your income taxes.

Maintenance – Owning meant budgeting for repairs, maintenance and improvements.

Lost Opportunity – Down payment and closing costs robbed you of the opportunity to invest and make some money.

You get the idea.  Frank just listened.  The debate moved to the predict the future stage.  Sophisticated calculations revolved around how fast home prices would rise compared to inflation rate of rents.  Results showed that the breakeven point was say 5 years.  If you lived there less than the breakeven point, you should rent.  You should buy if you lived there longer.

Do you really know what the future holds?  Five years ago did you predict what was about to happen?  Are you where you expected to be?  Life can turn on a dime.

Planning’s fine.  It’s even a good thing, but it misses the mark.  Finally, Frank decided to reveal the truth.

Owning a home is a lifestyle choice.

Online calculators (and there are some good ones) can help you decide if you can afford the American Dream.  If the American Dream doesn’t turn you on, the calculators were of little use.

How do you want to live?

Kathy Godin, Award-Winning Loan Officer and Branch Manager
CrossCountry Mortgage Inc.
(919) 789-9888
Where people, not computer robots, answer the phone.
Proudly Serving All of North Carolina

Sources:  NY Times & Ginnie Mae