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The Rent Versus Buy Debate, Chicago Style

  • January 13, 2012

by Erin Calandriello

As home prices begin to reach their bottom and average rents in Chicago remain high, the rent-versus-buy question is becoming a more frequent topic of conversation around town. Granted, many are not in a position to buy a home, be it for lack of a down payment or the time just isn’t right. But for those who can, UrbanTurf gives potential buyers a comparison of rental costs versus mortgage payments at various properties around the city.

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Printers Row condo

The two-bedroom, two-bath condo in the Loop’s Printers Row (see above) is listed for $239,500. The monthly payments for this unit, based on a 20 percent down payment and including property taxes, assessment fees, and a 30-year fixed rate mortgage at 4.25 percent comes in at $1,706/month. This is $200 less than the average rent in Printers Row, according to the latest RentJuice stats.

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Lincoln Park condo

How about this one-bedroom, one-bath pad in Lincoln Park? Listed for $235,000, the monthly payments (based on the same criteria as the property above) comes out to be $1,546/month. The average rent in Lincoln Park is about $150 less than these monthly payments.

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River West Condo

Then there’s this two-bedroom, two-bath 1,500 square-foot unit in River West, which is asking $309,900. The monthly mortgage payment (based on the same criteria as the previous examples) equates to $2,009/month. This is about $36 less than the average rent in River West, according to the latest RentJuice data.

So readers, based on this data, what do you think? Would you rent or buy?

This article originally published at http://chicago.urbanturf.com/articles/article/reality_of_buying_versus_renting/4925

3 Comments

  1. RS said at 5:50 pm on Friday January 13, 2012:

    lets take your first example (printer’s row). 20% down is $47,900 then add closing costs then add all other xpenses included in making a home purchase - not to mention the cost of moving. Same scenario for other examples. Renting looks good at the moment if you don’t have the cash to purchase at this price. Also your interest rate is high unless you are doing a purchase construction loan.  And FHA is better for down payment of 3.5% if possible.

  1. KB said at 6:31 pm on Friday January 13, 2012:

    Is it really fair to do a rent vs. buy comparison without adding in the monthly fees paid by condo owners? Normal condo fees would add hundreds of dollars to the monthly amounts you list above for condo owners. Throw in property taxes, insurance, unit maintenance and repairs, and the occasional special assessment levied by condo boards, and renting starts to look a whole lot more attractive.

  1. tommy said at 7:00 pm on Friday January 13, 2012:

    If you read the article again, the figure includes assessment fees, property taxes, and the monthly mortgage payment. So, it’s a pretty fair analysis.

Tracy Dillard

Koenig & Strey

312-893-3557

Serving:

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