Buying vs. Renting

Sales of townhomes in the Oakhurst neighborhood in the 21236 zip code of Baltimore County in 1997 ranged from $97,500 to $145,900 for a few of the larger townhouses. Rentals in that same year ranged between $800 and $950 (for rentals listed on the Multiple-Listing Service).

If someone bought a home at that time for $100,000 with a five-percent down payment, the payment would have been under $900, and even at today's tax and insurance rates, would only be about $925.

In the meantime, monthly rental rates in the same time period have gone up more than $50 a year. In the past year, townhouses in Oakhurst have rented for between $1200 and $1400 a month.

The buyer that bought that home in 1997 would have paid close to $200,000 if they had been making the minimum payments and paid off their loan today. The house would more than likely have sold for more than $200,000. Within the past year, sales have ranged from $175,000 to $280,000. If they wanted to, that buyer could get all their money back! Even at the minimum rental in the area, they would have paid over $100,000 and have nothing.