Renting vs. Buying

Why Rent?


In many cases, the amount of money a renter spends on rent can be about the same as or less than the amount a homeowner spends on a mortgage. With the tax benefit for homeowners, the savings can be significant. The chart below shows a cost comparison for a renter and a homeowner over a seven year period.


  • The renter starts out paying $800 per month with annual increases of 5%
  • The homeowner purchases a home for $110,000 and pays a monthly mortgage of $1,000
  • After 6 years, the homeowner's payment is lower than the renter's monthly payment
  • With the tax savings of homeownership, the homeowner's payment is less than the rental payment after 3 years

Years Rent Payment Mortgage Payment Monthly Difference After Tax Savings Yearly Difference After Tax Savings

Rent Payment
Mortgage Payment
Monthly Difference
After Tax Savings
Yearly Difference
After Tax Savings
1 800 1000 -200 -50 -2400 -600
2 840 1000 -160 -10 -1920 -120
3 882 1000 -118 +32 -1416 +384
4 926 1000 -74 +76 -888 +912
5 972 1000 -28 +122 -336 +1464
6 1021 1000 +21 +171 +252 +2052
7 1072 1000 +72 +222 +864 +2664
8-30     Savings increase every year

Loan Programs Available for First-Time Buyers
First time home buyer loans allow buyers to get into a house more easily. However, just because you’re a first time home buyer doesn’t mean you should use a first time home buyer loan. These programs have restrictions and strings attached. While they are a perfect fit for some, first time home buyer loans are the wrong choice for others.

A person’s first home purchase is a big deal. It takes time, energy, and money. To help with the money hurdle, some people use first time home buyer loans. These programs vary depending on where they’re offered, but the general idea is this: first time home buyer loans give financial assistance to qualified borrowers. They may do this in the following ways:

  • Allow for a very low (or no) down payment
  • Subsidize interest costs (they pay all or part of it)
  • Offer grants
  • Forgive loans
  • Limit fees that lenders are allowed to charge
  • Defer payments

Note that first time home buyer loans available to you might offer any or none of the benefits listed above. A good place to research first time home buyer loans available in Wisconsin is the HUD Web site on home buying programs. Visit the HUD website for more FHA information and guidelines - HUD website.

Who Gets First Time Home Buyer Loans?
As you might imagine, individuals who have never owned a home are good candidates. In addition, some programs offer first time home buyer loans to people who have not found a home within the last three years. You may have to meet certain income restrictions to qualify for a subsidized first time home buyer loan. In general, these programs try to limit benefits to people with low and moderate income levels. If you earn too much, you won’t qualify for the program. More on FHA.


How Much Can I Afford
There are a host of calculators available to assist you with determining how much home you can afford. check our mortgage calculator to see what feels comfortable to you. In the end, your mortgage broker can best assist you with what you can afford by going over the loan process and expenses that lenders use to calculate loan determinations.

Helping to Make Your Dream a Reality!
Finding and buying a new home should be a rewarding experience. At CENTURY 21 Affiliated, we know the search for your dream home is about more than just putting a roof over your head. It's an expression of your hopes and dreams, your lifestyle and values. It's a place to spend time with family and friends, as well as your personal retreat at the end of your day. CENTURY 21 Affiliated has been helping people find their dream home since 1967. We are proud to be your real estate partner…wherever life leads you!