Quote:
Originally Posted by Radley77
Or spend $450,000*.06= $27,000 to bank in interest
vs. renting at your $1000*12= $12,000 in rent?
It's a game of which is the lesser evil...
By the way, I agree that bonds aren't the best investment vehichle, but I think it is a valid comparison because bonds are 100% safe, so I'd hope that anything I invest in has a spread above the long term bond to compensate me for taking that risk.
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How about some real numbers. I rent a condo out for $1200/month that is worth about $260,000 or so.
So, following your math:
$260,000*.06=15,600 in interest to the bank (+ the equity built up as the property increases in value)
$1200*12=14,400 in rent with no return.