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Federal Reserve Bank of Cleveland
Economic Commentary
Buy a home or rent? A better way to choose
Ozgur Emre Ergungor
Saeed Zaman

Knowing whether buying a home is a better financial move for a family than renting requires a consideration of costs and options that people often neglect to factor in. One aspect of the calculation that is almost always overlooked is uncertainty—the fact that no matter how good one’s estimates of the future are, the future can turn out differently than projected. Incorporating uncertainty into the rent-or-buy calculation gives potential homebuyers information that can improve their decisions. While incorporating uncertainty is complicated, it’s made easier with the Cleveland Fed’s online calculator.

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Ozgur Emre Ergungor & Saeed Zaman, "Buy a home or rent? A better way to choose" , Federal Reserve Bank of Cleveland, Economic Commentary, issue Apr, 2011.
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Keywords: Households - Finance; Home ownership; Rental housing
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