If you own but previously rented, I have a question for you.

shabbatiscoming

Mon, Jan 19 2015, 9:52 am

Was your rent higher or lower than your mortgage payments? And where do you live?

Im wondering what the norm is, anywhere really, in terms of rent in areas as opposed to mortgage payments.

Someone just told me that they are paying 5000 shekels rent for a 3 bedroom 1 1/2 flr apartment and their mortgage, please gd, will be at least 2 thousand shekels lower. (they bought a one flr 4 bdrm apartment)

Does that happen in most places? Or did they just get really lucky? And again, I mean anywhere in the world, not just Israel where my example takes place. Im curiuos for all over.

abby1776

Mon, Jan 19 2015, 9:58 am

In Maryland in Baltimore my rent was $3000 a month for a 5 bedroom 2.5 bath house, and when I bought a 5 bedroom house 3.5 bath in Silver Spring for 575K with a mortgage rate at 3.75% my monthly payment was like $2200.

pesek zman

Mon, Jan 19 2015, 10:06 am

I can answer this question (I fit the criteria) but isn't your monthly mortgage determined by how large or small your down payment is? My current monthly outlay is Lower now (owning) than it was renting only because I put a huge amount down and have a very small mortgage. If I had put only 20% down my answer would be very different. Oh, and I live in NY

Sanguine

Mon, Jan 19 2015, 10:11 am

Since we're in Israel too, mortgages are different in Israel so if you're thinking of buying speak to only people in Israel. Israeli mortgages balloon. So many people get in trouble cause they take a mortgage equal to their rent and then it grows. Our mortgage is lower than rent. Whenever we discuss finances on LII I don't know how people manage when they spend so much on rent.

The trick here in Israel is to buy something very small in the beginning and then move up. It worked for us. It didn't hurt that the small apartment was in Shoham when there was nothing there and our house is in the Shomron Very Happy

.

So to answer your question - Yes, your mortgage payments should be lower than rent (or you'll be in trouble)

amother

Mon, Jan 19 2015, 10:15 am

Montreal: We rented a 2.5 bedroom for 900$ (Rents have since risen a lot). We now own a triplex, (we have 2 tenants), our part of the mortgage is 800$. This includes all taxes. Our insurance premium brings our monthly bill to 1030$. Admittedly, we were very lucky. We bought at the height of the mortgage crisis. It is now 6 years later and our home is worth 250000$ more than we paid for it.

Sanguine

Mon, Jan 19 2015, 10:28 am

Just to add add about Israeli mortgages. You have to put down a lot more to begin with also. (I think at least 50%). And you need people to sign for you here. Your house isn't your collateral if you don't pay, their's is!!

Iymnok

Mon, Jan 19 2015, 10:40 am

We are paying 5000nis. (That's 1000 over the market). Our mortgage will be 3000nis. We want to pay more per month to finish early.
Rent:4.5 rooms
Own: 6 rooms

ora_43

Mon, Jan 19 2015, 11:54 am

Sanguine wrote:

Israeli mortgages balloon.

Sanguine wrote:

It's not "Israeli mortgages" that balloon. Certain types of mortgages can rise with time, and certain types do not. If you get a fixed interest rate mortgage your payments won't increase here any more than they would anywhere else.

You need to put about 30% down, unless your income isn't enough (in the bank's opinion) to cover the loan you're asking for. There are companies that loan part of the down payment, for a price.

Most banks don't ask for guarantors anymore.

For us mortgage payments were higher than rent, but if we took a longer mortgage payment period they'd be lower than rent.

KollelWife3

Mon, Jan 19 2015, 11:59 am

We live in Brooklyn.

We rented a two bedroom apartment for $1,500.

We now own a 3 bedroom apartment with a mortgage of $1,200

Win-win

amother

Mon, Jan 19 2015, 12:48 pm

KollelWife3 wrote:

We live in Brooklyn.

We rented a two bedroom apartment for $1,500.

We now own a 3 bedroom apartment with a mortgage of $1,200

Win-win

Dang! I wish it made sense for us to live in Lakewood!

Sanguine

Mon, Jan 19 2015, 1:13 pm

ora_43 wrote:

And don't forget 0% Maam (or was that cancelled?). I'm sorry that my mortgage wasn't higher cause it's almost paid up. Imagine if I suddenly had an extra 5,000 shekel a month when the mortgage was paid?

amother

Mon, Jan 19 2015, 3:14 pm

We are considering to purchase a home where the monthly mortgage will be just a little more than our rent; however, tax is high in our area so we will end up paying a lot more because of the tax. At the end of the game we will be paying more than double to have our own home and more living space.

nyer1

Mon, Jan 19 2015, 3:30 pm

Obviously it depends on the down payment percentage of the cost of house

To rent in my area would be about 2k for the same size apt we bought and mortgage and taxes combined are 1600 a month. The difference goes straight into savings

amother

Mon, Jan 19 2015, 3:39 pm

We were living in a one bedroom looking for a 3bedroom or larger. Rent prices were in the 1200-1500 range, that was a while back. By now those appartements are in the 1800-2000 range.
We ended up buying a 4bedroom place and our mortgage plus maintanance (included in the rent too) is 1300.
ETA: the mortgage included complete refurbishment of the place. Back then we were able to get the mortgage without a penny in downpayment thanks G'd. Nowadays thats impossible.
This is from Vienna.

ven

Mon, Jan 19 2015, 4:10 pm

I rent now at 720 euros . Two bedrooms . My house will be 629 a month 4 bedrooms . This is without water electricity ,.. Belgium
Edit: its a fixed intrest rate

gittelchana

Mon, Jan 19 2015, 5:58 pm

shabbatiscoming wrote:

amother

Mon, Jan 19 2015, 6:00 pm

gittelchana wrote:

Not necessarily. You might have bought a four floor house and are renting only the basement. Wouldn't cover the full mortgage.