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Buy vs. Lease a Home. EGR 403, Summer 2004, Team 10. Jeffrey Scheinost – Organizer Stephen Casey – “Techie” Omabamid Odubela – Summarizer Mohammad Fazil – “Techie”. Introduction. Buying vs. Leasing a home Analysis Considerations Buyer/Leaser- combined household income $90,000

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Buy vs lease a home l.jpg

Buy vs. Lease a Home

  • EGR 403, Summer 2004, Team 10

Jeffrey Scheinost – Organizer

Stephen Casey – “Techie”

Omabamid Odubela – Summarizer

Mohammad Fazil – “Techie”


Introduction l.jpg
Introduction

  • Buying vs. Leasing a home

    • Analysis Considerations

      • Buyer/Leaser- combined household income $90,000

      • Invests 10% annually

      • Assume taxes are constant 25%

      • Can have money for down payment


Scenario 1 buy l.jpg
Scenario 1- Buy

  • Condominium in Glendale

  • Priced at $370,000

  • 1245 s.f., 3 bedroom, 2.5 bath

  • Puts 20% down

  • Fixed Mortgage

    • 5.6% A.P.R.

    • Lender: American Home Loans

    • 30 Year Loan

  • Maintenance costs - $100/month

  • Cash Flow Analysis


Scenario 2 buy l.jpg
Scenario 2- Buy

  • Condominium in Glendale

  • Priced at $370,000

  • 1245 s.f., 3 bedroom, 2.5 bath

  • 100% Financed w/ Private Mortgage Insurance

  • Fixed Mortgage

    • 5.6% A.P.R.

    • Lender: American Home Loans

    • 30 Year Loan

  • 30 year loan

  • Maintenance costs - $100/month

  • Cash Flow Analysis


Scenario 3 lease l.jpg
Scenario 3 - Lease

  • Apartment located in Glendale CA

  • 1235 s.f. 2 bedroom, 2.5 bath

  • Rental price of $2,499 per month ($1000 Security Deposit)

  • Annual rent increase of 6%

  • No Maintenance costs involved

  • Cash Flow Analysis


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