Micahel owns his house which currently has a market value of $375,000. He thinks He will leave town after three years. If He continues to hold his house, he will likely sell it for $415,000 after three years. If he sells the house now, he can invest the money in a special saving account that pays 0.20% interest per month. If he sells the house, he will need to rent a place to live in for $1,200 per month. Assume for simplicity, that he freely holds the house and only pays $400 per month in property taxes and house fees to legally keep it. What would be the more economical option for him? For analysis purposes, Michael's monthly value of time is 0.35%. Assume that now, time zero, Michael does not need to pay any taxes or house fees. Payments will start by the end of the first month.

Please assume: that a calendar year has 365 days

Please assume that a calendar month has 30 days