Why Rent?        Why make your landlord rich?


Here is an example of why not to rent / stay on campus. . . . .  

Students staying on campus are paying the college an estimated $6,700 per year.

If you end up renting from a landlord – the average rent on a 3 bedroom house is currently around $1,400  -  $2,200 per month.  That means if you and 3 roommates live in the house you will be paying $350 - $450 /person/month.

 

Case Study…

Monthly Payment Breakdown                                                                                            Rent                 Buy
Payment amount:                                                                                                                   $1,600                     $1,673
Monthly property tax:                                                                                                             $0                            $289
Other monthly costs:                                                                                                               $0                            $50
PMI:                                                                                                                                        $0                            $126
Homeowner’s Insurance:                                                                                                          $0                            $100
Renters Insurance:                                                                                                                    $30                          $0
Monthly maintenance:                                                                                                             $0                            $125

Total payment range:                                                                                                              $1,630 - $1,715       $2,365
Average after tax payment over 4 years:                                                                                 $1715                      $1,947
Monthly savings:                                                                                                                     $232                        $0


Tax Savings
Total payments for 4 years:                                                                                                    $82,366                   $113,528
Total after tax payments for 4 years:                                                                                      $82,366                   $93,492

Total tax savings:                                                                                                                    $0                            $20,035


Total Cost Analysis Over 4 years
Total payments:                                                                                                                     $82,366                   $113,528
Total tax savings:                                                                                                                   $0                            ($20,035)
Net proceeds:                                                                                                                       ($7,564)                  ($40,619)

Total:                                                                                                                                  $74,802                   $52,873

If you buy, you will save $21,929 over the next 4 years


You are making payments of $1,673 per month – you are now living in the house with 3 friends.  You all would pay $418 in total / month - - -  Essentially you are having 3 of your friends help you pay off your house.  You can then either sell the house when you graduate – or keep it as an investment property and continue renting it out to other students.  Best of all – you get all the tax advantages of owning a house.
                                                               

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