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- Jan 3, 2008
Dont wanna throw money away for stupid rent. Own a house.
Rent Forever, Donât Buy A Home
- Thread in 'General' Thread starter Started by DCAllAfrican,
- Start date
- 22,261
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- Feb 10, 2003
If I rent for the next five years as opposed to buying a home my house would have to depreciate 33% over the next 5 years to make up the difference.
I just don't see that happening when I plan on buying a house in the fastest growing city in America.
My rent went up 40 bucks last year or 6% if this continues which it probably I will spend:
9060
9606
10179.10
10790.00
11438.00
Total=51073.00
I know I'm not leaving this area in the next 5 years and my home value isn't going to depricate in the next 5 years to an extent to where I would be losing money if I want to sell in 5 years.
I just don't see that happening when I plan on buying a house in the fastest growing city in America.
My rent went up 40 bucks last year or 6% if this continues which it probably I will spend:
9060
9606
10179.10
10790.00
11438.00
Total=51073.00
I know I'm not leaving this area in the next 5 years and my home value isn't going to depricate in the next 5 years to an extent to where I would be losing money if I want to sell in 5 years.
- 22,261
- 11,072
- Joined
- Feb 10, 2003
If I rent for the next five years as opposed to buying a home my house would have to depreciate 33% over the next 5 years to make up the difference.
I just don't see that happening when I plan on buying a house in the fastest growing city in America.
My rent went up 40 bucks last year or 6% if this continues which it probably I will spend:
9060
9606
10179.10
10790.00
11438.00
Total=51073.00
I know I'm not leaving this area in the next 5 years and my home value isn't going to depricate in the next 5 years to an extent to where I would be losing money if I want to sell in 5 years.
I just don't see that happening when I plan on buying a house in the fastest growing city in America.
My rent went up 40 bucks last year or 6% if this continues which it probably I will spend:
9060
9606
10179.10
10790.00
11438.00
Total=51073.00
I know I'm not leaving this area in the next 5 years and my home value isn't going to depricate in the next 5 years to an extent to where I would be losing money if I want to sell in 5 years.
- 4,104
- 10
- Joined
- Sep 19, 2006
This is not good or bad advice it is just advice. If your basing a decision on information like this you really aren't ready mentally to buy. I personally am going to wait til the end of the year to buy unless I find a dead to rights cant beat it in 6 months deal. You should not finance unless the value appreciation is higher than 6-7% imo.
Say your single and make $3,500 after taxes, Life insurance, retirement savings etc so depending on your contributions like 55-60k
1000 for rent at most in big cities ( I personally would put out closer to $650)
800 for food ( I dont know many that actually spend that much)
100 for lights
100 for cable
gas depends from $50-125
Cell is $100
Bus pass is $85.00
Unless you buy a car outright. Government auctions ftw.
Thats aprox $1200 in income which you can litereally save, but why spend that extra money on a Mortgage and the up keep of your own property at least now?\
Take that $1200 a month and save it for 2-3 years dont touch it. You even at a market captialization of 6% have just made $5,000 on your money. Take that money and buy your home cash.
Now you literally have that same Now your saving $2200 a month sans at worse $5,000 in property taxes, and about the same in home repairs that your saving for ( not necessiarly spending)
So while your saving the same amount per month your money is beginning to do more work for you.
If you do your homework on a property then you should not have to do any repairs for at minimum 3 years. Meaning you get the septic tank, plumming electrical, hvac/ hot water heater in additon to cosmetic issues checked out for satisfaction. You dont want to mess up on this aspect and have to do a $10,000 electrical redo, or a $5,000 hvac redo.
Another suggestion I would make would be especially when looking at your first property is to look at foreclosed and auctioned homes, hell look at homes that where lost due to property taxes , just try and find a deal where as soon as you hold the title your home is taxed at a value higher than what you paid. Believe it or not common sense will help you in this regard.
But look at the similar priced homes in the area. The look and the square footage should not match up. Here is why I say that. Say your buying a 2 bedroom condo with 1200 sf. Well... the comps in the area should not have the second full bathroom you have, it should not have the updates you have. Thats why if your a first time home buyer you should almost exclusively look at foreclosures, shortsales and home auctions at this particular time. Even now whats going for 100k full priced is going for 50k foreclosed. Its an extra pain in the butt, but if your telling me personally I have to spend an extra 3 months in addition to the 2-3 it normally takes closing on a home, or miss out on one shortsale because the bank didnt want to do it and find another one and it ends up taking 9 months but I save 50 k well thats well worth it imo. I digressed though. The cosmetic is important just not as important as things like for a SFH the foundation, and in general the plumming, heating, be it HVAC or hot water, and the electrical. Also in general if the home is larger you generally want your common areas to have hardwoods, or stone and the bedrooms carpet. ( if you insist on having carpet at all) Trendy areas have fell in love with things like quartz countertops. Granite is a more versitile and prob the more approperate choice if your wanting to put countertops in or your finding homes with it. That's the cosmetic aspect. You have to consider the cosmetic and any information devulged within the marketing of the home as to the condition of the things that require major repair be it mechanical or cosmetic. Then you look at the comps in higher price ranges until you get to something that has similar square footage and cosmetic aesthetics. Thats a general idea as to the value of the home, but you dont know until the tax accesor comes in and you get that value. Now the tax guy isnt going to give you a selling price but that combined with the sale of comps will give you an idea as to profit off sale you may recieve. Thats really just the basics too
In closing of the wall of text Buying is still the better option and should always be considered. Renting is something you do so that you save money be it for long term investiments ( starting a business of your own, saving for a house) or simply the fact your not mature enough.
Also if I had more stability as a single person I would be looking at 3 flats. I look at it like this If I only need an apartment, or something that sized for myself, yet can buy or even finance....ugh
I would do this before anything. But never get in a situation where you have to have a renter inorder to pay the mortgage, because that goes against all personal finance, as well as residental real estate finance rules.
Say your single and make $3,500 after taxes, Life insurance, retirement savings etc so depending on your contributions like 55-60k
1000 for rent at most in big cities ( I personally would put out closer to $650)
800 for food ( I dont know many that actually spend that much)
100 for lights
100 for cable
gas depends from $50-125
Cell is $100
Bus pass is $85.00
Unless you buy a car outright. Government auctions ftw.
Thats aprox $1200 in income which you can litereally save, but why spend that extra money on a Mortgage and the up keep of your own property at least now?\
Take that $1200 a month and save it for 2-3 years dont touch it. You even at a market captialization of 6% have just made $5,000 on your money. Take that money and buy your home cash.
Now you literally have that same Now your saving $2200 a month sans at worse $5,000 in property taxes, and about the same in home repairs that your saving for ( not necessiarly spending)
So while your saving the same amount per month your money is beginning to do more work for you.
If you do your homework on a property then you should not have to do any repairs for at minimum 3 years. Meaning you get the septic tank, plumming electrical, hvac/ hot water heater in additon to cosmetic issues checked out for satisfaction. You dont want to mess up on this aspect and have to do a $10,000 electrical redo, or a $5,000 hvac redo.
Another suggestion I would make would be especially when looking at your first property is to look at foreclosed and auctioned homes, hell look at homes that where lost due to property taxes , just try and find a deal where as soon as you hold the title your home is taxed at a value higher than what you paid. Believe it or not common sense will help you in this regard.
But look at the similar priced homes in the area. The look and the square footage should not match up. Here is why I say that. Say your buying a 2 bedroom condo with 1200 sf. Well... the comps in the area should not have the second full bathroom you have, it should not have the updates you have. Thats why if your a first time home buyer you should almost exclusively look at foreclosures, shortsales and home auctions at this particular time. Even now whats going for 100k full priced is going for 50k foreclosed. Its an extra pain in the butt, but if your telling me personally I have to spend an extra 3 months in addition to the 2-3 it normally takes closing on a home, or miss out on one shortsale because the bank didnt want to do it and find another one and it ends up taking 9 months but I save 50 k well thats well worth it imo. I digressed though. The cosmetic is important just not as important as things like for a SFH the foundation, and in general the plumming, heating, be it HVAC or hot water, and the electrical. Also in general if the home is larger you generally want your common areas to have hardwoods, or stone and the bedrooms carpet. ( if you insist on having carpet at all) Trendy areas have fell in love with things like quartz countertops. Granite is a more versitile and prob the more approperate choice if your wanting to put countertops in or your finding homes with it. That's the cosmetic aspect. You have to consider the cosmetic and any information devulged within the marketing of the home as to the condition of the things that require major repair be it mechanical or cosmetic. Then you look at the comps in higher price ranges until you get to something that has similar square footage and cosmetic aesthetics. Thats a general idea as to the value of the home, but you dont know until the tax accesor comes in and you get that value. Now the tax guy isnt going to give you a selling price but that combined with the sale of comps will give you an idea as to profit off sale you may recieve. Thats really just the basics too
In closing of the wall of text Buying is still the better option and should always be considered. Renting is something you do so that you save money be it for long term investiments ( starting a business of your own, saving for a house) or simply the fact your not mature enough.
Also if I had more stability as a single person I would be looking at 3 flats. I look at it like this If I only need an apartment, or something that sized for myself, yet can buy or even finance....ugh
I would do this before anything. But never get in a situation where you have to have a renter inorder to pay the mortgage, because that goes against all personal finance, as well as residental real estate finance rules.
- 4,104
- 10
- Joined
- Sep 19, 2006
This is not good or bad advice it is just advice. If your basing a decision on information like this you really aren't ready mentally to buy. I personally am going to wait til the end of the year to buy unless I find a dead to rights cant beat it in 6 months deal. You should not finance unless the value appreciation is higher than 6-7% imo.
Say your single and make $3,500 after taxes, Life insurance, retirement savings etc so depending on your contributions like 55-60k
1000 for rent at most in big cities ( I personally would put out closer to $650)
800 for food ( I dont know many that actually spend that much)
100 for lights
100 for cable
gas depends from $50-125
Cell is $100
Bus pass is $85.00
Unless you buy a car outright. Government auctions ftw.
Thats aprox $1200 in income which you can litereally save, but why spend that extra money on a Mortgage and the up keep of your own property at least now?\
Take that $1200 a month and save it for 2-3 years dont touch it. You even at a market captialization of 6% have just made $5,000 on your money. Take that money and buy your home cash.
Now you literally have that same Now your saving $2200 a month sans at worse $5,000 in property taxes, and about the same in home repairs that your saving for ( not necessiarly spending)
So while your saving the same amount per month your money is beginning to do more work for you.
If you do your homework on a property then you should not have to do any repairs for at minimum 3 years. Meaning you get the septic tank, plumming electrical, hvac/ hot water heater in additon to cosmetic issues checked out for satisfaction. You dont want to mess up on this aspect and have to do a $10,000 electrical redo, or a $5,000 hvac redo.
Another suggestion I would make would be especially when looking at your first property is to look at foreclosed and auctioned homes, hell look at homes that where lost due to property taxes , just try and find a deal where as soon as you hold the title your home is taxed at a value higher than what you paid. Believe it or not common sense will help you in this regard.
But look at the similar priced homes in the area. The look and the square footage should not match up. Here is why I say that. Say your buying a 2 bedroom condo with 1200 sf. Well... the comps in the area should not have the second full bathroom you have, it should not have the updates you have. Thats why if your a first time home buyer you should almost exclusively look at foreclosures, shortsales and home auctions at this particular time. Even now whats going for 100k full priced is going for 50k foreclosed. Its an extra pain in the butt, but if your telling me personally I have to spend an extra 3 months in addition to the 2-3 it normally takes closing on a home, or miss out on one shortsale because the bank didnt want to do it and find another one and it ends up taking 9 months but I save 50 k well thats well worth it imo. I digressed though. The cosmetic is important just not as important as things like for a SFH the foundation, and in general the plumming, heating, be it HVAC or hot water, and the electrical. Also in general if the home is larger you generally want your common areas to have hardwoods, or stone and the bedrooms carpet. ( if you insist on having carpet at all) Trendy areas have fell in love with things like quartz countertops. Granite is a more versitile and prob the more approperate choice if your wanting to put countertops in or your finding homes with it. That's the cosmetic aspect. You have to consider the cosmetic and any information devulged within the marketing of the home as to the condition of the things that require major repair be it mechanical or cosmetic. Then you look at the comps in higher price ranges until you get to something that has similar square footage and cosmetic aesthetics. Thats a general idea as to the value of the home, but you dont know until the tax accesor comes in and you get that value. Now the tax guy isnt going to give you a selling price but that combined with the sale of comps will give you an idea as to profit off sale you may recieve. Thats really just the basics too
In closing of the wall of text Buying is still the better option and should always be considered. Renting is something you do so that you save money be it for long term investiments ( starting a business of your own, saving for a house) or simply the fact your not mature enough.
Also if I had more stability as a single person I would be looking at 3 flats. I look at it like this If I only need an apartment, or something that sized for myself, yet can buy or even finance....ugh
I would do this before anything. But never get in a situation where you have to have a renter inorder to pay the mortgage, because that goes against all personal finance, as well as residental real estate finance rules.
Say your single and make $3,500 after taxes, Life insurance, retirement savings etc so depending on your contributions like 55-60k
1000 for rent at most in big cities ( I personally would put out closer to $650)
800 for food ( I dont know many that actually spend that much)
100 for lights
100 for cable
gas depends from $50-125
Cell is $100
Bus pass is $85.00
Unless you buy a car outright. Government auctions ftw.
Thats aprox $1200 in income which you can litereally save, but why spend that extra money on a Mortgage and the up keep of your own property at least now?\
Take that $1200 a month and save it for 2-3 years dont touch it. You even at a market captialization of 6% have just made $5,000 on your money. Take that money and buy your home cash.
Now you literally have that same Now your saving $2200 a month sans at worse $5,000 in property taxes, and about the same in home repairs that your saving for ( not necessiarly spending)
So while your saving the same amount per month your money is beginning to do more work for you.
If you do your homework on a property then you should not have to do any repairs for at minimum 3 years. Meaning you get the septic tank, plumming electrical, hvac/ hot water heater in additon to cosmetic issues checked out for satisfaction. You dont want to mess up on this aspect and have to do a $10,000 electrical redo, or a $5,000 hvac redo.
Another suggestion I would make would be especially when looking at your first property is to look at foreclosed and auctioned homes, hell look at homes that where lost due to property taxes , just try and find a deal where as soon as you hold the title your home is taxed at a value higher than what you paid. Believe it or not common sense will help you in this regard.
But look at the similar priced homes in the area. The look and the square footage should not match up. Here is why I say that. Say your buying a 2 bedroom condo with 1200 sf. Well... the comps in the area should not have the second full bathroom you have, it should not have the updates you have. Thats why if your a first time home buyer you should almost exclusively look at foreclosures, shortsales and home auctions at this particular time. Even now whats going for 100k full priced is going for 50k foreclosed. Its an extra pain in the butt, but if your telling me personally I have to spend an extra 3 months in addition to the 2-3 it normally takes closing on a home, or miss out on one shortsale because the bank didnt want to do it and find another one and it ends up taking 9 months but I save 50 k well thats well worth it imo. I digressed though. The cosmetic is important just not as important as things like for a SFH the foundation, and in general the plumming, heating, be it HVAC or hot water, and the electrical. Also in general if the home is larger you generally want your common areas to have hardwoods, or stone and the bedrooms carpet. ( if you insist on having carpet at all) Trendy areas have fell in love with things like quartz countertops. Granite is a more versitile and prob the more approperate choice if your wanting to put countertops in or your finding homes with it. That's the cosmetic aspect. You have to consider the cosmetic and any information devulged within the marketing of the home as to the condition of the things that require major repair be it mechanical or cosmetic. Then you look at the comps in higher price ranges until you get to something that has similar square footage and cosmetic aesthetics. Thats a general idea as to the value of the home, but you dont know until the tax accesor comes in and you get that value. Now the tax guy isnt going to give you a selling price but that combined with the sale of comps will give you an idea as to profit off sale you may recieve. Thats really just the basics too
In closing of the wall of text Buying is still the better option and should always be considered. Renting is something you do so that you save money be it for long term investiments ( starting a business of your own, saving for a house) or simply the fact your not mature enough.
Also if I had more stability as a single person I would be looking at 3 flats. I look at it like this If I only need an apartment, or something that sized for myself, yet can buy or even finance....ugh
I would do this before anything. But never get in a situation where you have to have a renter inorder to pay the mortgage, because that goes against all personal finance, as well as residental real estate finance rules.
- 23,256
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damn, i wish i could get something for 90k
- 23,256
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- Jan 19, 2002
damn, i wish i could get something for 90k
- 22,261
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- Feb 10, 2003
That dude is talking crazy with those appliance prices too.
I bought a washer AND dryer off craigslist three months ago for 300 bucks. %@!+ looks and works brand new.
I bought a washer AND dryer off craigslist three months ago for 300 bucks. %@!+ looks and works brand new.
- 22,261
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- Feb 10, 2003
That dude is talking crazy with those appliance prices too.
I bought a washer AND dryer off craigslist three months ago for 300 bucks. %@!+ looks and works brand new.
I bought a washer AND dryer off craigslist three months ago for 300 bucks. %@!+ looks and works brand new.
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Why?
- 31,468
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Why?
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- Jan 5, 2011
I still chose OWNING a home over renting. Like others said depends on location and if you have ay kind of handy skills most home repairs can be done by yourself if you have marbles upstairs. Homes that are worth 300-400k you will probably get 200k or less for them now since the housing.burst. I say pay cash and avoid HOA AT ALL COST. IMO
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- Jan 5, 2011
I still chose OWNING a home over renting. Like others said depends on location and if you have ay kind of handy skills most home repairs can be done by yourself if you have marbles upstairs. Homes that are worth 300-400k you will probably get 200k or less for them now since the housing.burst. I say pay cash and avoid HOA AT ALL COST. IMO
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no offense but i wanna do the exact opposite of what you favor
- 3,184
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no offense but i wanna do the exact opposite of what you favor
- 159,916
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- Oct 13, 2001
Originally Posted by jawnyquest
i live in NYC, i'm gettin' jipped no matter what i do.
Yea you will. Which is why sometimes I feel living in a big city isn't all it is cracked up to be. But the damn Subway is so lovely in NY and DC/
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Originally Posted by jawnyquest
i live in NYC, i'm gettin' jipped no matter what i do.
Yea you will. Which is why sometimes I feel living in a big city isn't all it is cracked up to be. But the damn Subway is so lovely in NY and DC/
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- Mar 13, 2004
There are good/bad that come with both renting and owning. I've rented an apartment and now I own a house. When I was renting (in the DC area), I was spending around 2g's per month on my unit. This was back in 2005. I weighed the pros/cons about being a home owner and decided (in 2006) that the time was right for me to buy. Do what is best for you and your situation. There is no right/wrong answer for ANYONE in this thread.
- 21,151
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- Mar 13, 2004
There are good/bad that come with both renting and owning. I've rented an apartment and now I own a house. When I was renting (in the DC area), I was spending around 2g's per month on my unit. This was back in 2005. I weighed the pros/cons about being a home owner and decided (in 2006) that the time was right for me to buy. Do what is best for you and your situation. There is no right/wrong answer for ANYONE in this thread.
- 517
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- Jan 14, 2004
the article is missing one thing: if you can put the money in a better returning investment than getting a house is silly, even if its less than renting.
Here is the bottom line:
If youre gonna buy and put people in the house to pay the rent = good idea for the long term
If youre gonna be strapped with debt for 30 years on a house you live in that is appreciating at a nominal rate compared to other investments( Mutual funds/hard money lending) than it may not be such a good idea.
When people buy homes they put build a portfolio around an illiquid asset, a terrible idea.
Obviously people get lucky, and people get burned. One has to look at the opportunity cost of THAT PARTICULAR INVESTMENT. If you buy a house for 100k and it moves to 150k in ten years that 50k could be made faster in another investment. OR not. You guys have to look at this objectively, not say buying a house is stupid.....first rule of real estate: Location, Location, Location. Some times its a no brainer, sometimes its for people with no brains. Lumping all opportunities together and sayin buying a home or not is stupid is just short sighted.
I work for a real estate private equity company, my job is to find good deals and get investors to cough up. Anyone who buys homes at market valuer needs to do more research. Thats the first problem with the general public, they dont know how to find a steal, and agents are incentivized to find you the most expensive house they can.
Here is the bottom line:
If youre gonna buy and put people in the house to pay the rent = good idea for the long term
If youre gonna be strapped with debt for 30 years on a house you live in that is appreciating at a nominal rate compared to other investments( Mutual funds/hard money lending) than it may not be such a good idea.
When people buy homes they put build a portfolio around an illiquid asset, a terrible idea.
Obviously people get lucky, and people get burned. One has to look at the opportunity cost of THAT PARTICULAR INVESTMENT. If you buy a house for 100k and it moves to 150k in ten years that 50k could be made faster in another investment. OR not. You guys have to look at this objectively, not say buying a house is stupid.....first rule of real estate: Location, Location, Location. Some times its a no brainer, sometimes its for people with no brains. Lumping all opportunities together and sayin buying a home or not is stupid is just short sighted.
I work for a real estate private equity company, my job is to find good deals and get investors to cough up. Anyone who buys homes at market valuer needs to do more research. Thats the first problem with the general public, they dont know how to find a steal, and agents are incentivized to find you the most expensive house they can.
- 517
- 10
- Joined
- Jan 14, 2004
the article is missing one thing: if you can put the money in a better returning investment than getting a house is silly, even if its less than renting.
Here is the bottom line:
If youre gonna buy and put people in the house to pay the rent = good idea for the long term
If youre gonna be strapped with debt for 30 years on a house you live in that is appreciating at a nominal rate compared to other investments( Mutual funds/hard money lending) than it may not be such a good idea.
When people buy homes they put build a portfolio around an illiquid asset, a terrible idea.
Obviously people get lucky, and people get burned. One has to look at the opportunity cost of THAT PARTICULAR INVESTMENT. If you buy a house for 100k and it moves to 150k in ten years that 50k could be made faster in another investment. OR not. You guys have to look at this objectively, not say buying a house is stupid.....first rule of real estate: Location, Location, Location. Some times its a no brainer, sometimes its for people with no brains. Lumping all opportunities together and sayin buying a home or not is stupid is just short sighted.
I work for a real estate private equity company, my job is to find good deals and get investors to cough up. Anyone who buys homes at market valuer needs to do more research. Thats the first problem with the general public, they dont know how to find a steal, and agents are incentivized to find you the most expensive house they can.
Here is the bottom line:
If youre gonna buy and put people in the house to pay the rent = good idea for the long term
If youre gonna be strapped with debt for 30 years on a house you live in that is appreciating at a nominal rate compared to other investments( Mutual funds/hard money lending) than it may not be such a good idea.
When people buy homes they put build a portfolio around an illiquid asset, a terrible idea.
Obviously people get lucky, and people get burned. One has to look at the opportunity cost of THAT PARTICULAR INVESTMENT. If you buy a house for 100k and it moves to 150k in ten years that 50k could be made faster in another investment. OR not. You guys have to look at this objectively, not say buying a house is stupid.....first rule of real estate: Location, Location, Location. Some times its a no brainer, sometimes its for people with no brains. Lumping all opportunities together and sayin buying a home or not is stupid is just short sighted.
I work for a real estate private equity company, my job is to find good deals and get investors to cough up. Anyone who buys homes at market valuer needs to do more research. Thats the first problem with the general public, they dont know how to find a steal, and agents are incentivized to find you the most expensive house they can.
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- Jul 9, 2009
ARMs are for suckers if you plan on holding for the long term.
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ARMs are for suckers if you plan on holding for the long term.
unbornseed
Banned
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- Dec 7, 2009
Actually they're good if you're intelligent with your money. You can refinance to a standard loan at any point in time. The first few years of your mortgage almost entirely goes to interest anyway.
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- Dec 4, 2010
not sure if Im misunderstanding this, but I htink youre wrong.
owning a house means not paying rent and gettin some sort of return/loss. Assuming theres some sort of return on the house, your return on another investment would have to be more than the return on the house, even after subtracting the money you throw away on rent from it, to actually earn you more money than the house. Historically, that would have to be a pretty high return on your investment to outweigh both the return on the house and cover rent, depending on the house of course.
