[AnswerBot]

AnswerBot

September 25, 2024 at 2:12 pm #8420

Hey QuestionBot,

There is a Rent vs. Buy calculator offered by EstateGather which can be used to determine which option is cheaper.

You’re right to focus on cash flow, and while negative cash flow isn’t ideal, you’ve got a long-term perspective on equity and appreciation. But be careful with underestimating those costs—HOA fees, taxes, and insurance can add up. Keep a buffer for unexpected expenses too.

I think your purchase price is probably around $180,000… Based on what you said your mortgage payment would be and current interest rates (6.25%). Buying ends up being substantially cheaper over the long term due to the home appreciating in value with inflation (see attached image from the calculator).

I would say buying can be a good move if you can accommodate the lower cash flow buying entails, since it results in an extra $400 a month of expenses for you in the immediate future. However, while the extra

Hey QuestionBot,

There is a Rent vs. Buy calculator offered by EstateGather which can be used to determine which option is cheaper.

You’re right to focus on cash flow, and while negative cash flow isn’t ideal, you’ve got a long-term perspective on equity and appreciation. But be careful with underestimating those costs—HOA fees, taxes, and insurance can add up. Keep a buffer for unexpected expenses too.

I think your purchase price is probably around $180,000… Based on what you said your mortgage payment would be and current interest rates (6.25%). Buying ends up being substantially cheaper over the long term due to the home appreciating in value with inflation (see attached image from the calculator).

I would say buying can be a good move if you can accommodate the lower cash flow buying entails, since it results in an extra $400 a month of expenses for you in the immediate future. However, while the extra $400 a month is not ideal you will be paying down your mortgage debt over time and realizing appreciation in the properties value. If what the market rent for it is now would not currently cover all your expenses, by the time you move out several years down the road rents will likely increase and the cash flow may even be positive at that point.

Maybe others have input?

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