Renting vs owning a home and vehicles.

[ssj4sadie]

It's misleading because it wasn't the point of discussion. You purposely left information out of your initial reply as a got ya. Just like everything, if you buy smart, you're less likely to upside down in a house. I would use mine as an example, but personal stories are anecdotal vs using data points from all over that state this.

So the answer is to be upside down on vehicles that has zero chance of appreciating in value?

Because the "got ya" as you say is 100% relevant to the discussion. You are acting like renting=never owning. That's just not the case. Although some may feel like that, I don't. The assumption of wrong priorities because you buy a new "expensive" vehicle while renting is asinine. I will buy a house again when I am ready. But I was ready for new vehicles before.

 

[DHG1078]

If you rent a house for 30 years, what do you have at the end of 30 years? Nothing. Renting a house in my area is just as expensive as a mortgage payment. It saves nothing, and you aren't earning equity in anything.

If you buy a house, you're paying off your own loan and not someone elses. At the end of a typical 30 year mortgage, you have an asset worth hundreds of thousands of dollars. Even if your house somehow didn't go up in value at all, you have an asset worth a large sum of money.


Everyone has to start somewhere in life, which is typically renting. Not many people can buy a house the day they turn 18, which is fine as long as the goal isn't to rent for life. Renting a cheap apartment, or a single room out of a house that's a fraction the cost of a mortgage to save up money is a great move when starting out. Renting a house that costs as much as a mortgage is not.

 

[Screw-Rice]

Because the "got ya" as you say is 100% relevant to the discussion. You are acting like renting=never owning. That's just not the case. Although some may feel like that, I don't. The assumption of wrong priorities because you buy a new "expensive" vehicle while renting is asinine. I will buy a house again when I am ready. But I was ready for new vehicles before.

Information was purposely left out to then use it later for a "you don't know my story" reply. Simply put, taking on somewhere along $70k-$100k worth of depreciating asset debt, does not put someone in a good position to qualify for a house when their DTI is out of whack, unless they're making a ton of money. By qualify I don't mean just barely, I mean qualify with the best possible rates. So advocating (in a roundabout way) long term renting as a smart move is simply not.

The really irony is this is from the guy who busted another members balls about their spending habits.

 

[Screw-Rice]

I just want to know this.

If you DON'T own a home, what do you do when you can no longer work? Are you waiting to inherit your parent's house? I'm just curious, not judging.

Powerball

 

[jpro]

I just want to know this.

If you DON'T own a home, what do you do when you can no longer work? Are you waiting to inherit your parent's house? I'm just curious, not judging.

I wonder about this too. Studies show that millenials don't care to own homes and are much more likely to relocate. If this is the case, in 30-40 years when they are in their 60's and 70's and want to retire, where will they live? How will they afford a place? I think your question is a good one. I hate owning a house, but I just can't figure out what I would do when I retire without an asset worth hundreds of thousands of dollars. I could sell my house at that point and live off the money I make (at least pay my rent or buy a smaller place) for the rest of my life.

As for owning a car...I own both of mine. I daily drive a ten year old Accord with 104K miles on it. I just drive it to work. We also have a minivan...yes, a minivan. I have a perfect FICO score so I financed it at 0% which is a win. We have two kids so a family truckster comes in handy.

I have no inheritance coming my way so that sucks. Oh, and my perfect FICO score really hasn't got me ahead at all. Big deal, I pay my bills on time. So basically, I'm a guy who does everything right and all I have to show for it is a ten year old Accord. LOL

 

[PhoenixM3]

My stance is that I want to own something. Not pay for someone else's.

Agreed. I'm just a knucklehead who bought and held real estate, so I was fortunate to amass some wealth by researching, selling, and relocating to another area with a lower cost of living and cheaper home prices. I'd argue that you should "go with what you know" for investments. I haven't had great success at the stock market, so I look for property instead. We have 4 rental properties which pay the mortgage on our "dream home" and with my military retirement, I don't have to work, but feel 53 is way too young to retire. Lastly, buying to me is always better than renting.

 

[CO Mack]

I just want to know this.

If you DON'T own a home, what do you do when you can no longer work? Are you waiting to inherit your parent's house? I'm just curious, not judging.

You continue to rent. I am buying a house but I understand it's a luxury. What is most important is to save/invest for retirement. A home is one way to do this, yet for reasons listed here (like the modern transient workplace) and more, not necessarily the most efficient one. Another example; 401(k) accounts are not collectible. You cannot lose your money in a lawsuit or bankruptcy. Try that with your home equity...

I am also renting a house. In south Florida, where we just moved for work. Let me tell you- evacuating a rental is a LOT easier decision.

A house is not the only way to build wealth despite the hundreds of billions of dollars spent trying to sell Americans ever increasing levels of mortgage debt, granite countertops, various insurance products for it, government lobbying etc etc. A paid off house is never "free and clear"; just try not paying the government their yearly cut. Also, a 30yr house is going to require expensive repairs and maintenance. (Eg- 30yr roof)

 

[CO Mack]

I want to be perfectly clear though, you must save for retirement. Buying a new car is not saving for retirement. If the only way you're comfortable doing this is in real estate, fine. Just realize your personal residence is consumption and buy accordingly.

 

[Coosawjack]

Incorporate....rent/lease everything and write it ALL OFF!!

 

[TK Doom]

You continue to rent. I am buying a house but I understand it's a luxury. What is most important is to save/invest for retirement. A home is one way to do this, yet for reasons listed here (like the modern transient workplace) and more, not necessarily the most efficient one. Another example; 401(k) accounts are not collectible. You cannot lose your money in a lawsuit or bankruptcy. Try that with your home equity...

I am also renting a house. In south Florida, where we just moved for work. Let me tell you- evacuating a rental is a LOT easier decision.

A house is not the only way to build wealth despite the hundreds of billions of dollars spent trying to sell Americans ever increasing levels of mortgage debt, granite countertops, various insurance products for it, government lobbying etc etc. A paid off house is never "free and clear"; just try not paying the government their yearly cut. Also, a 30yr house is going to require expensive repairs and maintenance. (Eg- 30yr roof)

Back in 1998 when i bought my first house, even with only 10% down, my mortgage was less than my previous rental payment. Then you add the fact that i'm deducting the interest, you get a pay increase.

Even $10k for a new roof is less than the annual cost of a rental payment (assuming the home is paid off).

 

[VenomVeins]

After many years of renting I pulled the trigger and bought a massive renovated condo with connecting 2 car garage in the La Costa area here.

Why?

Because the rents in San Diego are spiraling out of control. For the 4th time in 5 years, my rent got raised again. No point in paying nearly 2,000 a month in rent for a large one bedroom place near the beach when I can own a 2 bedroom in a better area close to the beach for a lower monthly payment. (Disclaimer: I laid down a 25% down payment and have excellent credit and got the lowest possible percentage rate)

I had 2 friends who rent that were discouraging me from buying, using the 'housing bubble burst' from '07 to '13 as an example. The problem with that thinking is that the banks ARENT giving out loans to people who can't pay it back. They are STRICT as hell and even limited me to a $500,000 loan when my stocks and liquid savings/checking accounts are damn near close to that.


In the 4 weeks since I bought mine, another condo in my complex that wasn't renovated sold for $25,000 more than I bought mine for. The market is on fire here, and there is VERY low inventory to choose from.


For me, buying just makes more sense. Especially here in San Diego.

 

[tistan]

Banks are advertising on the radio that you can get a home lone with $1500 down. I don't think the banks are real stringent rules now. It is just a matter of time before it collapses again and many people who should never have been given a home loan will default, walk away, and cry about how the big corporate bank took "their" home and put their kids on the street.

 

[1 Alibi 2]

Rent is good............................for the person who collects it !!!!

 

[PhoenixM3]

After many years of renting I pulled the trigger and bought a massive renovated condo with connecting 2 car garage in the La Costa area here.

Why?

Because the rents in San Diego are spiraling out of control. For the 4th time in 5 years, my rent got raised again. No point in paying nearly 2,000 a month in rent for a large one bedroom place near the beach when I can own a 2 bedroom in a better area close to the beach for a lower monthly payment. (Disclaimer: I laid down a 25% down payment and have excellent credit and got the lowest possible percentage rate)

I had 2 friends who rent that were discouraging me from buying, using the 'housing bubble burst' from '07 to '13 as an example. The problem with that thinking is that the banks ARENT giving out loans to people who can't pay it back. They are STRICT as hell and even limited me to a $500,000 loan when my stocks and liquid savings/checking accounts are damn near close to that.


In the 4 weeks since I bought mine, another condo in my complex that wasn't renovated sold for $25,000 more than I bought mine for. The market is on fire here, and there is VERY low inventory to choose from.


For me, buying just makes more sense. Especially here in San Diego.

....and I'm looking to dump a house in San Diego, shelter myself from taxes utilizing a 1031 exchange, and buy again in Colorado. We get $2900 for a shitbox 1800 sq. ft. house. I'm done with CA. Love the weather, but that is it.

 

[Screw-Rice]

Banks are advertising on the radio that you can get a home lone with $1500 down. I don't think the banks are real stringent rules now. It is just a matter of time before it collapses again and many people who should never have been given a home loan will default, walk away, and cry about how the big corporate bank took "their" home and put their kids on the street.

It's not as cut and dry as you think with those offers some mortgage companies make. Usually need to fall under a lot of specific criteria. After the crash, everything got locked down a lot more, so the odds of another housing bubble like that are very low.

....and I'm looking to dump a house in San Diego, shelter myself from taxes utilizing a 1031 exchange, and buy again in Colorado. We get $2900 for a shitbox 1800 sq. ft. house. I'm done with CA. Love the weather, but that is it.

If you're a granola eating liberal, please don't come here, we have enough of you trying to change CO into another shitty CA. If you're not a liberal, then please come and help offset their shitty utopia dreams that are raising our taxes.

 

[jaxbusa]

Yet another great thread on this forum. I am not a financial expert. My opinion is that home ownership makes sense if you plan on living in the same home for the long haul. Just look at a mortgage amortizer. You will see that you will pay most of your interest up front. You just don't pay x amount of interest every month. So, if you know you're going to move around every five to ten years you would look at renting. Think about it. You would have just been paying mostly on interest and won't have a lot, if any, equity. It would be like renting the house from the bank but you pay for repairs. The market could also change that. I know a person that is still upside down in their house after 9 to 10 years of paying on it.

It really does suck to think about your life and a mortgage. You move out of your parents house and don't have any credit or a down payment, so you get an apartment for a few years. You save and get your first house. You pay interest out the backside in the beginning of the mortgage for 5 to 10 years. You realize the house isn't big enough for your now growing family, or the neighborhood went to crap and you live by a drug dealer that rents. You find a bigger home in a better neighborhood and start another 30 year mortgage at 30 to 35 years of age. You pay it off and retire. Then you start a reverse mortgage to pay for other things that have gone up in price.

And I don't think people that own a home and rent it out are rolling in the dough. I think if you own an apartment or several duplexes, then it would be worth it.


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[Stanger00]

With a hot real estate market due to a shortage of available homes and apartments, rents have reached ridiculous amounts that challenge most mortgage payments. In my eyes and in the kind of market I live in it doesn't make sense to rent over buying. If you are carrying a huge car loan than you are just delaying your down payment and if you are waiting for the next downfall, well, so is everyone else.

Buying a home is for your protection at retirement age and if you have a retirement account that will accumulate enough wealth to purchase a home out right at retirement age than renting is good for you but I think that is more of a risk than just buying now.


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[PhoenixM3]

It's not as cut and dry as you think with those offers some mortgage companies make. Usually need to fall under a lot of specific criteria. After the crash, everything got locked down a lot more, so the odds of another housing bubble like that are very low.



If you're a granola eating liberal, please don't come here, we have enough of you trying to change CO into another shitty CA. If you're not a liberal, then please come and help offset their shitty utopia dreams that are raising our taxes.

Definitely not a liberal and never called CA my home. Only bought property while stationed there.

 

[SweetSVT99]

Will someone buy my house and rent it back to me? It only needs a new roof, soffit, siding, a few new windows, maybe a driveway and possibly some foundation work. Don't worry, it has a brand new $10,000 sewer line, a $5,000-ish HVAC system and sweet new garage door.....

 

[ssj4sadie]

Information was purposely left out to then use it later for a "you don't know my story" reply. Simply put, taking on somewhere along $70k-$100k worth of depreciating asset debt, does not put someone in a good position to qualify for a house when their DTI is out of whack, unless they're making a ton of money. By qualify I don't mean just barely, I mean qualify with the best possible rates. So advocating (in a roundabout way) long term renting as a smart move is simply not.

The really irony is this is from the guy who busted another members balls about their spending habits.

Lol, it is ironic. But to be fair I was just saying don't finance car mods with a CC and he should think about slowing down on it all together because of his new born. After some back and forth I dropped it as he said he was good.

Here in SA rent is at an equal cost of owning. But because I'm friends with the homeowner I'm way below the market. I could buy a house, but I would be shelling out an extra $600-$800 on a house I would actually want.

I'm not buying a house till I know I will live in it at least 5 years and won't move out of state from it. I'm also not going to trade in a vehicle and carry negative equity on a new loan.