How long would it take to recover the cost of buying a house/condo versus renting?

Question

That is, you would obviously loose money if you bought a condo and only lived in it for 6 months or so instead of having rented.

I know closing costs are high and that's the hurdel to get over.

I've herd it's anywhere from 3 to 5 years... any advice?

Answer 1

The problem with renting is that you get no tax break and won't own an asset. Also, you will enjoy the appreciation on the property during ownership period. If you bought and sold within the past 5-7 years you made out big time. Also, don't forget about the tax free (up to 500k capital gain) capital you get when if you lived in your homes as a primary residence for the past 2 out of five years as well. You would loose money if you bought the condo for 6 months and sold unless it was way under market value and could sell for a hefty profit. As far as closing costs you could ask for a sellers concession. Renting is a bad move unless you can't afford a mortgage. There are so many mortgage plans out there to get you in a home. Even if you were to pay just interest for 5 years and sell you could still benefit and make some money. I know of a few people who bought with this type of loan during the boom and made a large profit after 3 years tax-free.

Answer 2

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