52 Sidney Bay Price Analysis - Makes sense to Rent, not to Own
I have completed a rent versus buy analysis on 52 Sidney Bay Drive in Crystal Cove. Listed for sale at $2,895,000, this home recently rented for $6,000 per month.
The result? Renting wins hands down, costing $5,103 per month. Buying is a real disaster - it could cost $20,478 PER MONTH.
Leasing this house saves the person living there about $15,000. Per month. It is a no brainer, but runs counter to the standard wisdom that owning is the conservative way to go. It is not. Not now. Not here. Not in this price range.
This analysis takes everything into account. Tax benefits of owning, payment of principle on the mortgage, etc.
And this is a conservative estimate because it assumes only a 4.1% drop in the home's value over the next 12 months. If this drop in home value turns out to be in my opinion a more realistic 8%, then the cost of owning during the next year becomes a whopping $30,000 PER MONTH.
Of course, one interpretation of this analysis is that this home is hopelessly overpriced. And I agree with that.
The backup data is available on my blog www.bluemove.blogspot.com
I have completed a rent versus buy analysis on 52 Sidney Bay Drive in Crystal Cove. Listed for sale at $2,895,000, this home recently rented for $6,000 per month.
The result? Renting wins hands down, costing $5,103 per month. Buying is a real disaster - it could cost $20,478 PER MONTH.
Leasing this house saves the person living there about $15,000. Per month. It is a no brainer, but runs counter to the standard wisdom that owning is the conservative way to go. It is not. Not now. Not here. Not in this price range.
This analysis takes everything into account. Tax benefits of owning, payment of principle on the mortgage, etc.
And this is a conservative estimate because it assumes only a 4.1% drop in the home's value over the next 12 months. If this drop in home value turns out to be in my opinion a more realistic 8%, then the cost of owning during the next year becomes a whopping $30,000 PER MONTH.
Of course, one interpretation of this analysis is that this home is hopelessly overpriced. And I agree with that.
The backup data is available on my blog www.bluemove.blogspot.com