How much house could a house renter buy if a house renter could buy a house? This is a question many renters ask, especially with rising rental rates and tight competition for good rentals. In Colorado answers aren’t easy because the home values are also rising. To help answer this question, Zippia, an internet platform designed to assist
employees with career information, has developed an on-line calculator. All you do is plug in how much someone is paying in rent, and the calculator tells you what that person could afford to purchase at different locations around the country.
Zippia says the calculator uses home price, mortgage cost, and insurance rate data from Zillow, Lending Tree, and Insurance.com. I tested the calculator to determine the type of home one could by in Colorado based on rental amount paid. According to the Colorado Apartment Association’s most recent study, the average rent for a three bedroom home in Denver is $1990.38. So, plugging that amount into the calculator (for Colorado) yields the following results:
Home Size: 2,045 sq ft
Home Price: $425,368
Mortgage Amount: $340,294
Monthly Mortgage Payment: $1,526
Monthly Insurance Payment: $251
Monthly Tax Payment: $213
Does it work? Could your tenant client with $1,990.38 in monthly rent by a 3 bedroom house instead of renting? You be the judge.
Check out the calculator at https://www.zippia.com/research/how-much-can-you-get-for-500-rent/