Puchase Price= \$225000.00 Interest = 6.0% Down Payment = 10% Term of Loan = 30 years How long to live here = 5 years Monthly Rent = \$800 Rent Rate Increase = 2.6% House Appreciation = 4.0%

#### Mortgage Info

Down Payment: \$22,500.00
Mortgage amount after down payment: \$202,500.00
Monthly Payment: \$1,214.09 (Principal and Interest Only)
Since Principal and Interest are not the only factors of a loan we should include an estimate for PMI, Taxes and Insurance. An average Tax figure for your home tends to be about \$10 for every \$1000 assessed value. If the assessed value of your home is 85% this would make your home's assessed value \$191,250.00, and your monthly tax \$159.38. Your down payment was less than 20% of the loan..looks like you're paying PMI. This averages around \$56 for every \$100,000 borrowed.Your PMI is estimated to be \$113.40 per month.

With PMI, Taxes, and Homeowners Insurance (\$55 average) your payment would be around \$1,541.86.
Over the length of time you indicated (5 years), you would have spent \$92,511.89 on mortgage payments. This includes Principal, Interest, Taxes, Insurance and PMI (if applicable). You will pay \$58,780.46 in total interest over the 5 years that you live here. Your total taxes paid will be \$9,562.50.
Using a 4.0% appreciation rate over 5 years, your house will appreciate to \$273,746.90.

#### Rental Info

The monthly rent includes \$25 as an average for renters insurance: \$800 + \$25.00 = \$825.00 for the first year. Rate of increase is also a factor commonly used to determine an estimated increase of rent every year. We will use an average of 2.6% yearly increase. Over the length of time you indicated (5 years), you would have spent \$52,061.74 on rent and insurance.

#### Comparison

 Renting Buying Last Payment Amount: \$886.50 Last Payment Amount: \$1,541.86 Total Payments: \$52,061.74 over 5 years Total Payments: \$115,011.89 over 5 years (incl. down payment) Tax Savings: \$0 Tax Savings: \$24,261.75 (deductions for T and I) Appreciation: \$0 Appreciation & principal: \$62,811.83 Total Spent: \$52,061.74 *Total Spent: \$27,938.31
It seems that Buying a home would save you about \$24,123.44 over renting in the course of 5 years.

* Total Spent includes total mortgage paid - (appreciation + principal + tax savings).