Is it cheaper to rent or buy? That's what Trulia tries to figure out with this interactive price calculator. There are a couple of things that factored into these final percentages, represented by glowing green, yellow and orange circles. First, there's the part that Trulia took care for us: looking at the average rental and sale prices for comparable properties and adding in the average monthly fees associated with renting or buying. Then there's the part that we get to change around. Will we be owning/renting the property for 3, 5, or 7 years? Do we itemize tax deductions? If so, which tax bracket do we fall into? What's the mortgage rate on a 30-year fixed-rate loan? We assumed a 4.8% mortgage rate for all of the screen shots we took, but played around with the other factors to see whether it was generally cheaper to rent or buy in D.C. and Baltimore.
· Trulia: Buying is 31 Percent Cheaper Than Renting in DC Area [UrbanTurf]
· Rent vs. Buy: Which is Cheaper for You? [Trulia Trends]