Rent or Buy Calculator

Renting is a contract between client and agent in which the client can temporarily use an object or a property. There are many reasons why people rent instead of buy a house. One reason can be that someone may have financial insufficiency, since they cannot buy a house because of the high price, they settle for an alternative which is renting. But the bad thing about it is that they will not own the house they are renting.

While buying is the other alternative, if you would like to have your own house or pay the mortgage instead of rent in order to fully own the house, this is the best solution. There are many reasons why people buy a house. One of these is the appreciation of owning a house. Most of the people vision their homes as a wall against inflation. If you fully own the house, then in hard times in the economy won’t be much of a problem. Another is the pride of ownership, if you fully own the house, then you can do whatever you want with the house. You can paint a new color, or even build a new addition to the house.

Many people have a hard time determining if renting or buying is the right choice for them. The rent buy calculator can help you decide what the best choice for you is. To use the rent-buy calculator, you enter both the price in the rent category and in the buy category. In the buy category, you must enter the following information; mortgage loan amount, down payment, number of years you have to pay, the interest rate of the mortgage, the percent yield on equity, and the tax rate. While in the rent category, you must input the following; the monthly rent payment and the percent yield on investment. You will then be given the results that will give you the best choice. If you want to solve whether if you want to buy or rent, then this calculator can surely help you make the right decision for you.

For example, a man is confused whether to buy a house for his family or just to rent. He finds out that the house cost $100,000 and he will be given 20 years to pay it. His required down payment is $10,000, and the interest rate in mortgage is 9%. The percent yield on equity is 8% and the tax rate is 28%. While in the rent portion of the calculator you must enter the monthly rent payment which is $500, and the percent yield on investment is 8%. While clicking the calculate button, the following results will be given: Monthly mortgage is $809.75, total expenditure on mortgage is $194,340.81, total equity value is $512,705.29, total tax saves is $29,215.43, total profit of purchase is $347,579.91, and the total savings by rent is $231,719.08. The result for him and his family is better to buy then rent.