Re:Some young people are buying houses with friends
by dragonwriter on Wednesday March 06, 2019 @11:51PM
(#19325595)
> If I pay $2000 a month rent I'm always going to have less liquid capital than if I pay $1000 a month mortgage
If you pay 20% down plus 4% upfront in closing costs on a $1 million dwelling, and then pay mortgage of $3,800/mo (which is fairly realistic for a conventional loan), it'll be more than 5 years before you break even, in liquid capital and presuming nothing is extracted from equity and ignoring any property maintenance costs that landlords have that would be rolled into rent for most renters, with a renter paying $7,600 for a similar dwelling which would actually represent a quite high rental yield.
If you pay 20% down plus 4% upfront in closing costs on a $1 million dwelling, and then pay mortgage of $3,800/mo (which is fairly realistic for a conventional loan), it'll be more than 5 years before you break even, in liquid capital and presuming nothing is extracted from equity and ignoring any property maintenance costs that landlords have that would be rolled into rent for most renters, with a renter paying $7,600 for a similar dwelling which would actually represent a quite high rental yield.