Here’s why it’s more expensive to rent a home than you might think.
Should you rent, or should you own? It’s a common question, so today we want to go over a case study to give you a better understanding of the situation.
Let’s take a look at a pretty average property. It’s a two-bedroom, two-bathroom apartment on the north side of Chicago with parking included. If you check out the video at 0:55, you can get a more specific picture of where the apartment is located.
If you want to rent this property, your average rent per month will be around $2,869. That’s a pretty big amount, and over the course of a year, you’ll be coughing up $34,428 in payments. Over five years, that amount will be $172,140. That’s a lot of dough, but the worst part is that you aren’t even building any equity over this five-year period.
In contrast, that same rental payment of $2,869 would have bought you a $344,400 condo. This is based on a 5% down payment, our current interest rates, and average taxes. In five years, even in the unlikely event that your home doesn’t appreciate at all, you’ll have built up $42,693 in equity. When it comes time to sell your home, that money will go right back in your pocket.
Hopefully, this example made it clear why ownership is better than renting. If you are looking to become a homeowner or invest in real estate, please give us a call. We are always willing to help.