Has anyone done detailed analysis on Own vs Rent? Assuming of course that you'd be renting the exact same house you would buy, and vice versa.
In Houston, house appreciation is about 3% (no appreciation after inflation). Annual house rental is about 8% of house price (16K/year for a 200K house). Property tax is about 2.5% after homestead exemption. ROI is 9%. Maintenance, insurance, HOA also add to the cost of owning.
Using those numbers, my analysis tells me it's a bad, bad, bad idea to own. Renting the above house for 15 years, and you would end up with an extra 30K compared to owing it.
To break even, the house must appreciate at 4.5%.
What's your take? For this discussion, let's only focus on the financial aspect. Let's ignore all the surrounding emotions of own vs rent.
In Houston, house appreciation is about 3% (no appreciation after inflation). Annual house rental is about 8% of house price (16K/year for a 200K house). Property tax is about 2.5% after homestead exemption. ROI is 9%. Maintenance, insurance, HOA also add to the cost of owning.
Using those numbers, my analysis tells me it's a bad, bad, bad idea to own. Renting the above house for 15 years, and you would end up with an extra 30K compared to owing it.
To break even, the house must appreciate at 4.5%.
What's your take? For this discussion, let's only focus on the financial aspect. Let's ignore all the surrounding emotions of own vs rent.