Rental Costs Buying Costs Annual rent $ 7,380 Annual mortgage payments $ 9,800 ($9,575 is interest) Insurance $ 145 Property taxes $ 1,780 Security deposit $ 650 Down payment/closing costs $ 4,500 Growth in equity $ 225 Insurance/maintenance $ 1,050 Estimated annual appreciation $ 1,700 Assume an after-tax savings interest rate of 6 percent and a tax rate of 28 percent. Assume this individual has other tax deductions that exceed the standard deduction amount

. a. Calculate total rental cost and total buying cost. (Do not round intermediate calculations. Round your answers to the nearest whole dollar.) Rental cost $ Buying cost $

b.

Would you recommend buying or renting?

	Renting
	Buying