Homes prices are affordable and mortgage rates are low, so should you make the leap into homeownership? Although 85 percent of Americans still believe in the dream of owning a home, about a third choose to rent instead, according to a Fannie Mae study.
Some of the reasons have to do with potential homeowners' confidence in the housing market and the economy, while others don't want to take on home maintenance and expenses. But if you're on the fence, calculate the numbers to determine the break-even point between renting and buying. To do that, add up the upfront costs of owning -- including taxes, association and maintenance fees and down payment -- and determine how many years until the total payments meet the cost of renting. Or you can use the Bankrate calculator on renting versus buying.
According to a recent report, it's cheaper to buy than rent in many major markets, especially since rents have risen due to increased demand. Chicago, Minneapolis, Baltimore, Denver and St. Louis are markets where buyers will break even in fewer than three years.
Are you on the fence about homeownership, or are you happier renting?
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