IrvineRenter -
I dont think AMT disallow mortgage interest deduction. It disallows property tax deduction but I heard that they are about to change the AMT rules to ensure only the 'really' high-income tax payers get hit.
It seems to me that your calculation is very conservative but perhaps for a good reason. Everybody should decide their own risk tolerance and preference. I personally dont mind paying 10/1 IO loan vs renting since the net cost is the same after tax break, and the benefit of 'owning' outweigh the hassle of renting. The only risk I can see is if I have to sell the house when the price dips.
I dont think AMT disallow mortgage interest deduction. It disallows property tax deduction but I heard that they are about to change the AMT rules to ensure only the 'really' high-income tax payers get hit.
It seems to me that your calculation is very conservative but perhaps for a good reason. Everybody should decide their own risk tolerance and preference. I personally dont mind paying 10/1 IO loan vs renting since the net cost is the same after tax break, and the benefit of 'owning' outweigh the hassle of renting. The only risk I can see is if I have to sell the house when the price dips.