Housing

Rent Or Buy? Freddie Finally Fixes Calculator

Freddie Mac finally fixed an online calculator that's supposed to help people choose between renting and buying a home.

Until now, the calculator had a fundamental (and revealing) flaw: It assumed home prices could never fall.

Jacob Kosoff, an economist who was responsible for the calculator when he worked at Freddie Mac, talked to us earlier this year. He wanted to apologize.

"I'm sorry that I didn't send an e-mail or work a little harder to get that fixed so the calculator can allow for the possibility of reality," Kosoff told us — the reality that housing prices sometimes decline.

As of last month, the calculator still returned an error if you tried to assume that home prices would fall.

But today, we got an email from Kosoff. He wrote:

The Rent vs Buy calculator on the Freddie Mac website has been fixed. Though I wasn't able to get it fixed while I worked there, I am very relieved it is working properly now. The Planet Money story you did was excellent and I believe it led to this positive change.

You can try the calculator for yourself here.

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