Shared Living Solutions your Tauranga builder

Buy versus Renting

The Situation:

A young couple starting out together, will pay approximately $228,920 in rent over ten years, based on $350 per week at 5% per year.

This is lost to landlords and produces no return for them!

It would make much more sense to pool their resources with another couple and use the rent money to pay off a Shared Living house instead.

Not only will this give them a foothold in the property market and a home of their own, but it will also give them substantial capital gain within a few years.

NB - These are general equation and not a guarantee. Figures are based on information available at the time and are an indication only.

Shared living solitions why pay rent

 

The numbers:

The Project $500,000.00
Deposit $50,000.00 x 2
Balance $400,000.00

The Parties: Two couples

On a mortgage of $400,000 at 6%, each couple could satisfy all the lending conditions by paying $660.50 per fortnight or $330.25 per week on the mortgage. Or looking at it another way $165.12 per week x 4.

At the same time, each couple will gain equity growth on half the value of the house - $500,000.00 divided by 2 = $250,000.00.

Assuming 5% equity growth per year, each owner's wealth will grow as follows:

  • 1st year :: $262,500.00
  • 2nd year :: $275,625.00
  • 3rd year :: $289,406.25
  • 4th year :: $303,876.56
  • 5th year :: $319,070.39
  • 6th year :: $335,023.91

That is asset growth of over $85,023.91 in six years, or an average of $14,170.00 per year.

Compare this with how much money you have saved in the past year. Or in the past six years...

 

Shared Living Solutions are proud Tauranga builders and are associated with and members of:

Member of New Zealand certified BuildersShared Living Solutions licensed building practitionerHalo 10 Year Residential Guarantee

*Always check the LBP Register to ensure that your building practitioner is currently licensed.
 

home | shared living | buying vs renting | homes available | project gallery | testimonials | reagan's corner | contact us

Copyright © Shared Living Solutions | www.sharedlivingsolutions.co.nz | developed and hosted by Certified Builders Assn of NZ