NYTimes is based in New York, where right now there seems to be a lag where rent prices have not caught up to buying. My apartment probably has a market rent of about $8k and a sale price of $1.7m (guesses). An apartment like that usually has common fees of $3k - $4k. That is like $13k a month mortgage + HOA. It really comes down to assumptions about increase in value over the next 10 years.
@Manausa
3 ай бұрын
That's good info @nathangreenberg3683. So does the calculator say to "buy" or "rent" based upon your estimated value?
@nathangreenberg3683
3 ай бұрын
@@Manausa Well, not changing other variables, at $1.7m buy, $8k rent and $3.5 HOA, it says renting saves $765k. If I make rent growth 4.7%, home growth 4.7% and marginal tax rate of 37% (actual tax rate with city and state is 45%), then renting saves $165k. I do think this calculator just has too many variables to be helpful. If I could predict all these numbers I would be in finance. But, in NYC at least it seems like rent is a little behind the astronomical home prices. Maybe because NYC apartments are seen as a very stable investment.
@Manausa
3 ай бұрын
@@nathangreenberg3683 That's great feedback and as an aside, most real estate brokers from around the country will tell you "real estate is real estate, is doesn't matter where you are .... except for New York City!" I think you've got your answer, but if you want to nerd out a little, go to zillow and get the data for rents and home prices for the past twenty years and figure out realistic growth rates. I appreciate you adding to the discussion Nathan.
@NorthernAZRealEstate
3 ай бұрын
Great video! Yes, bias exists in a lot of media resources...the most important thing is to know your personal situation and act accordingly.
@Manausa
3 ай бұрын
Thanks for sharing your experience @NorthernAZRealEstate, it greatly adds to the video and channel.
@chrispoyner3338
3 ай бұрын
This is really good stuff Joe! You're always paying a Mortgage. You just have to decide if you're going to pay your own, or someone else's
@Manausa
3 ай бұрын
Thanks @chrispoyner3338, agreed on paying the mortgage. I'm wondering if the bias was purposeful or an oversite (NYC is home to most of the corporate homebuyers).
@Manausa
3 ай бұрын
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@ll38071614
28 күн бұрын
Hi I'm trying to figure out if the calculator invests the difference in monthly mortgage and rent to come to the conclusion. Thanks.
@Manausa
28 күн бұрын
Yes, a 4.5% anticipated return from the stock market (user adjustable).
@curtmillermusic1929
3 ай бұрын
Is there any scenario where renting is a better option?
@Manausa
3 ай бұрын
Absolutely @curtmillermusic1929. Duration of ownership is the key in every market because if you’re only going to own the home for one or two years, the closing costs are going to outweigh appreciation gains in most eras. Also if you take a look at Nathan’s comment, you’ll see what he’s doing in New York City is definitely smarter to rent than to buy. That’s why I think the tool is great, but you just don’t want to go with the default settings because they’re biased towards renting.
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