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You should also factor in "imputed rent," which is what you would have spent on housing had you not owned a home. Subtract your property taxes, mortgage interes
by giaour 4y ago
You should also factor in "imputed rent," which is what you would have spent on housing had you not owned a home. Subtract your property taxes, mortgage interest (+ PMI if you had it), and upkeep costs from how much it would have cost in monthly rent to live in your home.
Generally, even if you lose money from inflation, property taxes, transaction costs, and maintenance, imputed rent will put you ahead in the end.
- bombcar 4y agoIt can be quite instructive to "excel pretend" that you're buying your house and renting it to yourself. Buy a few landlording books and read through them, and then vigorously track everything that would be a "rental expense" if it were a rental property in your spreadsheet, then at anytime you can "back out" what you would have had to pay in rent assuming some % profit. Add that to rental comparables from your area and you can get quite a good idea as to the true cost of home ownership (and renting). Or you can do a simple version of it by calculating what the IRS would allow you to deduct as depreciation and assume that's roughly the maintenance cost.