Should I rent or buy my house?

-  1638  -  Should I rent or buy
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---------------------  1638  -  Should I rent or buy.  What will burn the most cash?  How about the long term?  When can I break even?
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-  If I rent it costs me -1700 / month, 20,400 per year.
-  I have 200K cash in the bank at 4% I get 8000 per year
-  Net is - 12,400 per year burning money by renting
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-  Rent cost per year--------------------    - 20,400
-  Interest on cash-----------------------    + 8000
-  Net cost per year----------------------  - 12,400
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-  If I buy I use my 200K cash in down payment and renovations.  - 8000 / year lost interest.
-  I get a 234K mortgage at 4.25 %,  1200 / month, 800 interest , and 400 principle
-  Mortgage  - 14,400 per year  less savings on taxes by deducting interest + 3,500
-  Net is -  10,500 add to the loss of interest on cash at 4%  =  -8000.
 - Net,net is - 18,500 per year burning money by buying.
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-  Mortgage ---------------------    - 14,400
-  tax savings--------------------    +   3,500
-  loss interest on cash  --------      - 8,000
-  Net is cost per year ------------ - 18,500
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-   Rent is 6,000 per year cheaper.  A savings of 500 per month.
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-  House appreciation must go up by 6000  per year to break even.
-  2012  value is 390,000
-  2022  value needs to be 450,000 to break even.  Anything higher is a good investment.,  less the cash put back into the house in maintenance and improvement.
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-   That is how the math helps you decide.  Of course the decision is more emotional than financial. But, it does not hurt to have some balance in a open mind.

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(1)  .Kahn Academy
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