Rent vs. buy home. Use Worksheet 5.2. Kayla Thompson is currently renting an apartment for $725 per month and paying $275 annually for renters insurance. She just found a small townhouse that she can buy for $285,000. She has enough cash for a $10,000 down payment and $4,000 in closing costs. Her bank is offering 30-year mortgages at 6 percent per year. Kayla estimated the following costs as a percentage of the homes price: property taxes, 2.5 percent; homeowners insurance, 0.5 percent; and maintenance, 0.7 percent. She is in the 24 percent tax bracket and has an after-tax rate of return on invested funds of 4 percent. Using Worksheet 5.2, calculate the cost of each alternative and recommend the less costly optionrent or buyfor Kayla.

Everything is correct, I am just struggling on how to find the % of annual appreciation for the home, Line B8. Thanks in advance!

interest is to multiply the interest rate by the size of the loan (in this case. $200,0000.04=$8,000 ). To find the principal reduction in the loan batale (line B.7), subtract the amount that goes to interest from total annual mortgage payments ($11,458$8,000=$3,458). interest is to multiply the interest rate by the size of the loan (in this case. $200,0000.04=$8,000 ). To find the principal reduction in the loan batale (line B.7), subtract the amount that goes to interest from total annual mortgage payments ($11,458$8,000=$3,458)