As a mortgage loan officer, I often get asked whether it’s better to buy or rent a home, especially when the decision involves a significant investment like purchasing a home in Whittier, CA. One property in particular that stands out is 8915 Calmada Ave, currently priced at $798,888. With an estimated interest rate of 6.25% and a forecasted appreciation rate of 5.07% per year over the next nine years, let's break down what buying versus renting could mean for you financially.
If you decide to purchase 8915 Calmada Ave at the current price of $798,888 with an interest rate of 6.25%, you’ll likely be considering a 30-year fixed mortgage. Assuming a 20% down payment, your mortgage would amount to approximately $639,110. Here’s a look at what your costs might look like over the next nine years:
Over nine years, your total out-of-pocket expenses (including down payment, mortgage payments, property taxes, and insurance) would be roughly $546,612.
With Whittier’s real estate market expected to appreciate at 5.07% annually, your home’s value could increase significantly over nine years. Let’s calculate:
By purchasing this home, you’re not only securing a place to live but also building substantial equity over time.
Let’s assume you decide to rent a similar home instead. Rents in Whittier for comparable properties are about $3,500 per month. Over nine years, this is what your costs could look like:
Unlike buying, renting doesn’t build equity. You’re paying for the ability to live in the home, but once you move out, you don’t recoup any of that money. Additionally, rents typically increase over time, which could lead to even higher costs in the later years.
Here’s a side-by-side comparison of the two options:
| Metric | Buying | Renting |
|---|---|---|
| Total Cost Over 9 Years | $546,612 | $378,000 |
| Home Value in 9 Years | $1,265,742 | $0 |
| Mortgage Balance | $556,430 | $0 |
| Home Equity | $709,312 | $0 |
When you compare the two, buying 8915 Calmada Ave allows you to build significant wealth through home equity, despite the higher upfront and ongoing costs. Renting, while potentially cheaper month-to-month, leaves you without any long-term financial gains from the property.
If your goal is to build wealth and secure a long-term residence, purchasing 8915 Calmada Ave appears to be a strong financial decision. The appreciation in property value and the equity you build over nine years can provide a solid return on your investment. While renting may seem like a more affordable option in the short term, it doesn’t offer the same financial benefits that come with owning a home in a growing market like Whittier.
As always, individual circumstances vary, and it’s essential to consider your financial situation, lifestyle, and future plans before making a decision. If you’re ready to explore buying this property or have more questions about your mortgage options, I’m here to help guide you every step of the way.
David Delgado
NMLS# 349079 • Freedom Choice Lending
Office: (562) 281-6163
Click Here To schedule a 15 minute loan consultation
The terms are based on 6.379% APR.
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