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The American Dream
Why Pay Rent?
No matter what you’re currently paying for rent, your total cash outlay over a period of several years will probably add up to a much higher total than you have realized. The chart shows how quickly the rent payments you’re making add up figuring in what this money would earn invested at 5% interest.
| Rent Per Month |
Rent Payment 10 Years |
Rent Payment 20 Years |
Rent Payment 30 Years |
| $600 | $93,169 | $246,620 | $499,355 |
| $700 | $108,698 | $287,724 | $582,581 |
| $800 | $124,226 | $328,827 | $665,807 |
| $900 | $139,754 | $369,930 | $749,033 |
| $1000 | $155,282 | $411,034 | $832,259 |
| $1100 | $170,611 | $452,137 | $915,484 |
| $1200 | $186,339 | $493,240 | $998,710 |
| $1500 | $232,923 | $616,551 | $1,248,388 |
Homeowner Advantages
When you’re figuring out how much you can afford to commit to monthly mortgage payments, don’t forget the tax advantages of home ownership. Both property taxes and interest payments on a mortgage for an owner occupied home are currently tax-deductible. In the early years of a typical mortgage, all but a small percentage of each monthly payment is used to pay off the interest on the loan.
This means that as a homeowner, your annual taxable income could be substantially reduced by deducting the payments you make on property taxes and yearly mortgage interest. Ask your CPA, attorney, or tax preparer how buying a home now would affect your tax situation.
In addition to tax advantages, you can also benefit from any increase in the value of your home both through appreciation and improvements you add for you own comfort and enjoyment.
Buying a home is probably one of the biggest investments you’ll ever make. And when it is your first home, it is especially important that you seek qualified assistance. Your real estate agent has the experience and expertise to help you find – and purchase – the home of your dreams!
Browse the Article Library
- Donna has put together a collection of articles designed with her clients in mind. Here you will find information on everything you might need before, during and after the home buying or selling process.
- Some of the more popular titles include information on doing a 1031 exchange to save on taxes, ways to fix up your home that will protect your investment, and the Top 10 Mistakes that Sellers Make. Have fun browsing!
- Should you have an idea for an article, or would like to recommend an article for inclusion that you have seen elsewhere, please contact Donna.
About Donna Baker
- Director of Heritage Homes, Dickson Podley Realtors
- Serving Monrovia, Duarte, Sierra Madre, Arcadia, Pasadena, and the entire San Gabriel Valley
- Representing Sellers and Buyers of all types of real estate with a specialty in vintage and character homes, as well as residential income properties.
- Watch a video about Donna