If you sell after 5 years, you are only making money if your home value happened to have gone up. This is by no means a guarantee on a short time frame.
If you sell after 5 years, you are only making money if your home value happened to have gone up. This is by no means a guarantee on a short time frame.
Of course, you have to consider this when you buy because many homes are terrible investments. If you come in with the view that you're buying what will eventually be an investment property you'll make better buying decisions.
Principal: 60%
Interest: 22%
Escrow(Taxes + Insurance): 18%
And of course the percentage going to interest only goes down with each passing month. The conventional wisdom that you are paying mostly interest in the beginning a) really only applies to 30 year mortgages, and b) was way more true when interest rates were higher. We're currently near some of the lowest interest rates in history, so interest eats a lot less than it used to.
I'll add that I pay a good bit less on my mortgage than it takes to rent an equivalent place in my area. But yes, paying 6% to realtors when you sell is huge, so you still need to own the house a few years for buying to make sense.
Also property taxes seem steep in USA.