Buy or Rent?
Fashion designer Delia Seaman regretfully admits that sales at her West Hollywood boutique are still suffering amid the recession. She has put her 1920s Spanish-style bungalow up for sale, and after Realtor fees and closing costs, she believes to clear up little or nothing beyond $922,000, the price she paid for the property four years ago– something close to the now asking price, of $999,000.
Seaman even says, her yearly mortgage payments, insurance and property taxes has exceeded what she would have spent renting a similar home annually. According to her the whole housing dream is kind of a joke, and says “I paid in for four years and got nothing. I wish I’d never bought.”
Seaman’s property agent, John M. Barrentine, calculates that her house would yield close to $1 million in a sale but less than 3% of that (or $30,000 a year) in net annual rent if leased out. She would be better off selling and putting her money into California municipal bonds. Buy you rent?
