Whether 'tis nobler in the minds of your parents and friends to rent; than to suffer the slings and arrows of home ownership, I have a few calculators that will help you make the decision based on your unique situation. Owning a home is an idea which is drilled into us from the moment we become financially aware of the cost to live someplace. Many people consider renting to be throwing away money which you could be using to build equity. In reality the true cost benefit of owning a home relies on many factors including home price, rental increase, home value appreciation and length of ownership.
The NY Times has a buying versus renting calculator which can put the decision into a time and dollar value perspective in order to aid the often murky choice. In my case according to the NY Times' calculator in the 8th year of ownership of a $100,000 house I will save $5 compared to renting based on appreciation and rental increases. AOL also offers a calculator to help you determine which housing situation is your best fit. One difference in the AOL calculator is that it lets you set a sell date, from which it will calculate the value of owning versus renting. Using similar figures I found that if I sell my hypothetical $100,000 house in 7 years I will be almost $6,000 better off than had I rented for those 7 years.
These calculators both shine because they factor in items that many homeowners may forget when purchasing a house. The foremost is that you can no longer call your landlord to get something fixed for free, now those costs come out of pocket. The NY Times' calculator has a prettier interface and is better if you don't have any idea of when you would be moving but the AOL calculator provides some excellent summary information!
Don't forget AOL has many financial calculators to help you make important life decisions.
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