Hey everyone!
Stuck on whether to buy or rent your home? I’ve whipped up an Excel spreadsheet that makes it super easy to compare the financial outcomes for buyers and renters after 20 years.
How it works:
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Buying scenario: Covers all costs - property price, legal fees, HOA fees, property taxes, and mortgage payments. You’ll see the total cost and property value after 20 years.
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Renting scenario: Includes rent and related expenses. The difference between monthly buying and renting costs is invested (you set the annual return rate).
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Final result: After 20 years, it shows the net value for each option. Compare the money saved by a buyer selling their property vs. a renter cashing out their investments.
Before you dive in:
- Customizable: I made this for my situation, but you can change all values to fit your needs.
- Pre-tax calculations: Doesn’t include taxes, as they vary by individual. Add them for a more detailed analysis if you want.
Why use this?
If you’re on the fence, this spreadsheet gives you a data-driven view. It factors in potential property value growth and investment returns to help you make an informed choice!
What do you think? I’m open to feedback or ideas to make it even better.
Let me know if you want a copy to play with your own numbers!
nice work bob! this sounds like a handy tool. i’ve been on the fence about buying vs renting for ages. would love to check it out and plug in my numbers. does it factor in potential repairs/maintenance costs for homeowners? thats always been a concern of mine.
As someone who’s been through the buy vs. rent rollercoaster, I can say your spreadsheet sounds like a game-changer, Bob. Wish I had this tool when I was house-hunting!
One thing I’d suggest adding is a way to factor in potential career changes or relocations. I bought a place thinking I’d stay put, but ended up with a job offer across the country two years later. The costs of selling so soon really ate into any equity I’d built.
Maybe include a ‘what-if’ scenario for selling before the 20-year mark? It could help folks like me who might have less predictable career paths. Still, this is a fantastic starting point for crunching the numbers. Kudos on creating such a useful resource for the community!
I appreciate your effort in creating this calculator, Bob. It’s certainly a useful tool for those weighing their housing options. Having gone through the buy vs. rent dilemma myself, I can attest to the complexity of the decision. One crucial factor I’d suggest incorporating is the opportunity cost of the down payment. When I ran my own numbers, I found that the potential returns from investing that lump sum elsewhere significantly impacted the long-term financial picture. Additionally, considering regional market trends could provide more accurate projections. Real estate appreciation varies greatly by location, and this can make or break the ‘buy’ scenario in some areas. Overall, your spreadsheet seems like a solid starting point for those beginning their analysis.