Suppose both the buyer and tenant have 10% of 266 800 euros in the bank account.

Suppose both the buyer and tenant have 10% of 266 800 euros in the bank account. The buyer loses that after the purchase in administration and notary fees, the tenant does not. The buyer must additionally borrow 266 800 euros over 10 years with monthly fixed payments and annual effective interest rate of 3 times 1.32%. The buyer uses all the savings at t0 while the tenant can just leave it at an interest rate equal to 1.32%. The buyer also has maintenance costs that can amount to 0.1% of 266 800 euros per month. The buyer does not live completely for free (see maintenance costs) but after 10 years (when loan is paid off) has the value of the house as equity. The tenant pays monthly rent and after 10 years has only money in the bank but can pass maintenance costs to the homeowner (no maintenance costs). The tenant could put the difference between buyer’s cost (monthly loan amount + maintenance costs) and rent into a savings account each month at 1.32% annualized.
a) Suppose the house grows in value at 1.32% annually, what assets (house value) does the buyer own after 10 years?
b) Suppose the house rent is 750 euros per month, how much can the tenant save monthly? (monthly loan amount + maintenance costs buyer – rent)
c) How high can the rent be at most to make renting equivalent to buying (at constant rent). Both buyer (house) and tenant (savings account) then end up with the same assets after maturity.
(d) Suppose the rent is 750 euros in the first month but then grows. How high may this monthly growth be to make renting equivalent to buying?
e) Suppose the tenant does not save but invests to 3.96% with the surplus, how does your answer change from c?