When you factor in the ability to build equity

When you factor in the ability to build equity, the tax savings on mortgage interest and the appreciation
rate of your home’s value, buying a home becomes a better deal within just a few years.
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*Based on median US home sale price ($208,238) and monthly rent ($1,364) according to Zillow Research, April 2015.
Mortgage assumes 97% LTV loan with BPMI, 4% interest rate, and 720 FICO. Costs may vary in different markets.
t Borrowers should consult their own tax advisors to determine if they are eligible for deductions.
© 2015 Radian Guaranty Inc. All information contained herein is subject to change without notice. RAC599 6/15
$12,494
5-Year Summary Buying Renting
Cost (initial cost + monthly payments) $ 81,434 $83,204
Property Taxes (2%) $ 20,824 0
Home Value Appreciation (2%) ($21,673) 0
Tax Savings (15%, interest + property tax) ($ 8,908) 0
Equity Increase ($19,295) 0
Net Expense $52,382 $83,204
Renting
Buying vs.
Cost to buy includes 3%
down payment & closing costs
Cost to rent includes security
deposit, first & last month’s rent
Monthly
Cost
Over 5 years, buying is a $30,822 advantage over renting.
And it can be an even greater advantage depending on taxes and appreciation in your market.
vs.
Bottom line: the decision to buy is a big one, but there
are also big benefits when compared to renting.
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