WASHINGTON (July 19, 2006) Â Renting can cost more than seven times annually than owning, according to a newly revised consumer education brochure from the National Association of RealtorsÂ®. The brochure, ÂWhy rent when you can buy?Â challenges certain assumptions about renting versus buying and helps RealtorsÂ® evaluate with their clients and customers whether homeownership is right for them.Is there really anywhere in the US where annual rent costs more then seven times what owning costs? Not sure how they come up with these numbers. This is pure deception. The NAR goes on to say:
This is also misleading for many reasons. First of all, if one buys there are taxes, insurance costs, and maintenance costs that are NOT mentioned and that are NOT 'steady,' Here is the page where you can purchase the NAR Brochure:
The Federal Reserve Board estimates that homeowners have a net worth nearly 36 times more than that of renters. Over the past 10 years, the cost of rental housing in the United States has increased an average of 3 percent per year; average rents are projected to rise 4.1 percent this year alone. With a 3 percent annual increase, a current rental payment of $1,000 per month would increase every year and amount to $137,567 after 10 years, with no wealth accumulation.
In contrast, a $210,000 home purchased today with a downpayment of $10,000 and a 30-year fixed rate mortgage at 6.5 percent would cost a steady $1,100 per month and yield a net worth of $138,521 after 10 years, assuming an historic 4.5 percent annual appreciation rate.
"Are your clients still on the fence about buying a home? Then tell them what they need to know! Homeownership is easier and less expensive than renting" Pass the Kool Aid!
The National Association of Realtors (NAR) is a harmful organization that has been cheerleading the housing bubble which is a speculative episode. The housing bubble is putting millions of Americans in financial harms ways. The behavior of the NAR is absolutely despicable.