Renter's Have a Savings Advantage over Homebuyers

Dow Jones
昨天

1030 ET - In August, the typical renter paid $1,066 less per month than the typical home buyer, according to Zillow. Rent was $1,948 while the typical mortgage payment plus taxes and insurance totaled $3,014--a gap that has grown as mortgage costs have risen faster than rents. For renters who can set that difference aside, it could translate into meaningful long-term savings. At $1,066 a month, renters save $12,792 a year over owning a home, and those who invest it at the rate of the 10-year Treasury yield earn an additional $322 in the first year alone. Assuming rents and home buying costs remain stable, that could turn into a cumulative total of $72,000 after five years--real wealth built without the hidden costs of homeownership like closing costs, maintenance and more.

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