RENT$-$OR$-$BUY ANALYSIS FOR HOUSING

Amount

COST OF BUYING

$($$$)$

Monthly mortgage payment

Annual mortgage payments

Property taxes

Homeowner$$s insurance

Maintenance expenses

Opportunity cost of down payment and closing costs

Total costs

Less

Reduction of loan principal

Tax savings on mortgage interest deduction

Tax saving on property tax deduction

Total deductions

Annual after$-$tax cost of homeownership

Estimated annual appreciation in home value

Total Annual Cost of Purchasing:

Based on this analysis, Latasha and her husband should:

Purchase the home, as the cost of purchasing is greater than the cost of renting.

Purchase the home, as the total cost of purchasing is less than the cost of renting.

Rent the home, as its total cost is less than the total cost of purchasing.