IS RENTING worse than buying?

IS RENTING worse than buying? In this market, might not be. Let’s do a quick calculation. Let’s take one of the #properties I just purchased. A $900,000 tenanted for $850/week.

A tenant needs to only worry about paying the rent = $3400/month.

The owner had 80% loan of $720,000. At 6.5%, his monthly interest repayment will be $3,900. On top of it, he has to pay for insurance ($1500/year), water service ($1000/year) and council rate ($2000/year). Then, owner also needs to pay for any maintenance required for the house.

While the idea of buying a house is great, however, since the house price has really gone up so much, depending on the amount of borrowing, renting will still be much cheaper.