Financial Shock Owave: The surprising trend where the students’ housing costs exceed the mortgage payments

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Buying a house for a university student at 23 of the 121 universities he surveyed was cheaper than paying a room and together, according to the Mortgage Research Network.

The results do not align perfectly with geography or population. Universities in Chicago, Milwaukee and Cincinnati show modest profits for housing owners, together with the South Universities in Jonesboro, Arkansas, Hattiesburg, Mississippi and Columbia, South Carolina. But the room and the Board win in other urban environments, especially on the super expensive west coast.

For example, students from the University of Washington-Seattle would lose when buying a house, paying about $ 83,000 more than the room and food for three years. The prices of very high homes are to blame for unequal calculations, which coincide with similar negative results at the University of Colorado-Boulder, the University of California-San Diego and the University of New York.

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The report goes one more step, calculating additional cost savings in housing ownership beyond a typical university education of three or four years. For example, he says that the three -year savings in Temple are almost $ 30,000, but the owner can obtain up to $ 70,000 earnings and celebrate the property for at least 10 years.

Where is the cheapest place to buy a house from your university child? The Marshall University in Huntington, West Virginia, wins the prize with the lowest average price of $ 137,909. Mom and dad could leave almost $ 19,000 ahead for three years in this agreement, according to the survey. Even better, property could save more than $ 33,000 if it is maintained for 10 years or more.

The University of Delaware, the University of Alabama and the University of Memphis in Tennessee complete the five best schools where it is better to have a house than in the payment room and the Board. West Coast and Rocky Mountain Cities above are the lower five, together with the California-Fullerton State University in Orange County and the State University of Montclair in New Jersey.

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Montclair State wins the Booby Prize in this report, arriving in the last place. Mortgage Research Network says that parents could lose up to $ 163,000 for three years buying a house near the university, instead of paying a room and the Board. It lists the average housing price in the New York suburb at $ 1.1 million, along with a total cost that has almost $ 10,000 per month.

How are these costs and savings calculated?

The payment of the mortgage, the property tax, the housing and owners insurance were added to the maintenance, closing costs and groceries. The rental income of roommates and the appreciation of the home were later subtracted, extending those values ​​for three years and comparing them with the published room of the school and the expenses of the Board. The costs, income and appreciation were adjusted for the average price house in the school location.

Why are three years used in calculations, instead of a typical four -year university education? EDUCATINDATA.org says that 22% of first -year university students are abandoned after only one year, biased four -year calculations. The author of the study also says that some institutions encourage first year students to live on campus, adding greater uncertainty to the results of four years.

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This Financial Shockwave article: The surprising tendency where the students’ housing costs exceed the mortgage payments originally appeared in Benzinga.com