Homebuying as a financial investment, help.

[Jacob Wilson]

Hello. So I've been crunching some numbers as I am about to purchase my first home. I've made a spreadsheet that enables me to see the amortization for any values you'd like to change in your home loan, loan ammt, % down, rate, and term. I then also list the expected value increase of the home over the life of the loan, say 3%/year as an estimate.

Now my question is when calculating the expected profit my numbers seem to indicate that putting lower down will give you more profit over time than putting more down, that is if the rate is the same. This seems counter intuitive however I know my amortization table is correct, so I'm left to think either my profit calcs are incorrect or this is in fact the case.

Here's my profit calculation:

Profit= Home Value-(Principle remaining+Down payment+selling costs)

So when I put in 100% down the profit is initially negative due to cost of selling, then increases as though you're earning 3% on a savings account. When I put 0% down the profit over the life of the loan is substantially greater. This again is all at a rate of 4.25%, I know generally the higher down the less the rate but I'm thinking of a FHA loan and I'm wondering the benefits of a larger down payment.

Can anyone shed some light on why this might be? I wish I could upload my spreadsheet so other can check my calcs. Thanks for the input!