Buy or Rent? Rent or Buy? It seems everyone you ask gives you some different spin on this, and no one seems to know for sure. I’ve heard a lot of “it’s a great investment..renting is just wasting money.” However, given the current housing market and economy, this may not be the best advice to follow.
In this month’s GQ, there was a pretty insightful article on home buying. If you calculate it, it turns out this whole “equity” and “good deal” thing is a total sham! If you have a giant stash, then sure, buying a home can be a good deal, but otherwise, you may want to think about it a bit more.
A good place to start is the New York Times online rent-versus-buy calculator. With it you can plug in the numbers such as size, zoning, rent, cost of houses, etc..and it will tell you how long you have to live in the house before the costs even out. Depending on your location, the calculator might surprise you. It’s a pretty well written light article and easy to read, so go grab a copy of the Feb GQ and read it. It’s the one with Rachel Bilson on the cover. Yes, there are pictures. Hooya hoo hoos.
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Something to keep in mind is that this extends beyond housing. A lot of people compare automotive buying to the housing market, except you don’t have quite as many forms. Always look as far into purchasing and financing laws in your respective state as you possibly can - particularly mortgage and leasing laws. You’ll find that a lot of states have laws designed to support buyers from being manipulated by banks or lease issuers.
If you’re super into getting all the details on your state, give your local lawyer a call. If you’re a little less creative, call your bank’s financial lender or call your dealership’s financial institution. I did. It helped (lots).
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