5. Buying a House
Advantages Disadvantages
•Payments Decrease and Become
Equity
•Paying Property Taxes
•It Is An Asset •Paying High Amounts of Interest
•Investment That Will Likely Increase
in Value
•Paying for Maintenance
•Can Improve Credit if Payments Are
Made Regularly and On-Time
•Can Ruin Credit if Payments Are
Missed or Not Paid On-Time
•Tax Cuts •Not Always Easy to Sell for
Relocation Purposes
6. Renting a House
Advantage Disadvantages
•No Property Tax Payments •Variable Monthly Payments That Will
Increase Over Time
•You Can Move Anytime You Want •Uncertainty of Residence (ie.,could
be evicted if property is sold)
•No Worry of Maintenance Fees •Doesn’t Build Equity
•Down Payment Money Can Be
Invested Other Ways
•Subject to Owner’s Rules and
Restrictions (ie., no parties, pets,etc.)
•Lower Costs Upfront (No Down
Payment)
•No Tax Breaks
7. Conclusion
• Renting a house at $2,500 per month plus
inflation would cost $156,120
• Cost of buying which is $153,379 and cheaper by
a total of $2,741
• Annual savings of approximately $548
• Paying off another home owner’s mortgage