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Pay less per month or the same for more.
Home ownership is not for everyone. But for most, it is less expensive than renting.
Rent compared with Monthly payments. If you are currently renting, multiply your rent by 200. This is roughly the expense of a home that you can afford, also allowing for tax savings. For example, if your rent is $1000/month, you would pay approximately the same amount to own a $200,000 home ($1000 x 200 = $200,000).
Consider the effects of inflation. Once you purchase a home, the bulk of your housing costs are not exposed to inflation. Using the above formula, paying $500 rent per month is like buying a home for $100,000. But in 40 years, assuming 4% inflation, you won't be paying $500 month for rent -- the cost will increase to $2400 month, like buying a house for $480,000. In contrast, if you purchase a home with a locked, fixed-rate mortgage, most of your housing costs will not be exposed to inflation.
Your net worth. Homes generally increase in value over the decades while you're paying your loan. All that home equity can help you through trading down during retirement or securing other loans.
Stretch a little. In the future, you'll be glad you did.
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