Rent vs. Buy
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Transcript of Rent vs. Buy
Kelly KangRealtor
Kelly joined Paragon after gaining a wealth of experience in real estate and construction.
Single Family Home Development
Construction Contract Review & Negotiation
Construction Litigation
Multi-Unit Investment Management
Tenancy-In-Common Development & Sales
Shannon was brought up in the real estate world, bought his first property at 22 and has experience in the following:
Residential Real Estate Lending
Commercial Real Estate Lending
Income Property Analysis
Green Building and Sustainable Design
Home renovation
Shannon LevensonLoan Consultant
If You’ve Ever Asked Yourself Any of These Questions…Consult a Real Estate Professional.
Is it better to Rent or Buy?
How Much is a Downpayment?
What would my Monthly Payment be if I Owned?
Is it a Good Time to Buy?
How do Interest Rates Affect Me?
Is it better to rent or buy? That depends on you.
Rent or Buy: How long will you stay?
Market Trends Since 1982
How Much is a Down Payment? 20% - YES
Conventional financing requires 20% down 10% - YES
With a 2nd loan/HELOC you can qualify for conventional financing with only 10% down
5% - YES With private mortgage insurance you can qualify for conventional
financing with only 5% down (3% in some instances) 3.5% - YES
FHA insured loans allow you to qualify for conventional financing with only 3.5% down
0% - YES VA and other government sponsored programs allow for 100%
financing or more for qualified individuals and properties
Where do I get the money for my down payment?
Liquid assets saving, checking, investment, IRA, retirement accounts
Gift funds friends and family can contribute money towards your
down payment
Down Payment Assistance Programs Non-profit or government programs to assist home buyers
with their down payment
Is It a Good Time to Buy? Interest Rates Lower than Ever!
Is it a Good Time To Buy? Historical Rent vs. Loan Comparison
How Do Interest Rates Affect Me?
Estimated Monthly Payments Assuming 20% Down Payment
Loan Amount Interest Rate P & I P & I + 0.5% P & I + 1% P & I + 2%
$100,000 3.500% $449 $477 $507 $568
$200,000 3.500% $898 $955 $1,013 $1,136
$300,000 3.500% $1,347 $1,432 $1,520 $1,703
$400,000 3.500% $1,796 $1,910 $2,027 $2,271
$500,000 3.750% $2,316 $2,460 $2,608 $2,918
$600,000 3.750% $2,779 $2,952 $3,130 $3,501
$700,000 4.125% $3,393 $3,599 $3,811 $4,253
$800,000 4.125% $3,877 $4,113 $4,356 $4,861
$900,000 4.125% $4,362 $4,627 $4,900 $5,468
$1,000,000 4.125% $4,846 $5,141 $5,445 $6,076
Neighborhood Trends
4500 California - $769,000
Lake District
2BD/2BA/1PKG
HOA: $283
1392 s.f.
Formal Dining Rm
Near Presidio
240 Linden St. - $779,000
Top-floor
Fully Remodeled
Natural light
2BD/2BA
Leased Parking
HOA: $0
Hayes Valley
ResourcesBuy vs. rent: These days, buying wins – CNN Money Article http://business.fiu.edu/pdf/PrintMay2011/buying-vs-rent.pdf
IRS Withholding Calculator http://www.irs.gov/Individuals/IRS-Withholding-Calculator
New York Times – Rent vs Buy Calculator http://www.nytimes.com/interactive/business/buy-rent-calculator.html?_r=1
Paragon Real Estate Group, Market Analytics
Statistics can be misquoted, misinterpreted and misunderstood. They are not considered "facts" but more generalities and it's important to know what a
statistic actually means within overall market conditions and what its limitations are. The market context behind a statistic is as important as the statistic itself. If
a significant market trend is developing, it will be reflected over the longer term and across a wide variety of different statistical measures.