"Zillow has brought ownership expenses to the housing spotlight in a study of what it calls hidden ownership expenses: maintenance, property taxes and insurance. Adding those costs to already painful mortgage payments provides a more comprehensive snapshot of the financial burden of ownership. And you can see how owning is costlier than what typical renters pay their landlords. My trusty spreadsheet broke down Zillow's hidden cost estimates for 30 large metropolitan areas including four in California"
"Contemplate the median results for the four California metros. Typical rents, according to Zillow's count, run $2,985 a month, compared with $6,316 in monthly ownership costs that includes a mortgage at 6.4% with a 20% down payment on a $933,000 residence. By the way, that $186,000 down payment is not included in these buyer costs. These calculations show the standard California rental can theoretically save a household $3,331 a month compared with owning. That is a 47% discount on housing expenses."
Zillow's analysis of hidden ownership expenses — maintenance, property taxes and insurance — increases the monthly cost of owning beyond mortgage payments. Combining those hidden costs with a mortgage provides a fuller measure of ownership burden. Median results for four California metros show typical rents at $2,985 per month versus $6,316 per month to own a $933,000 home with a 6.4% mortgage and 20% down; the $186,000 down payment is excluded from monthly ownership costs. That gap yields a $3,331 monthly saving for renters, a 47% discount, and would take about 16 years to close under optimistic assumptions.
Read at www.ocregister.com
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