Your throwing your money down a blackhole

[bex1218]

Pros and cons for everything in life. Financially for me, renting split 3 ways is the best option for me. Unfortunately, had to dig around cause one of my roomates is a felon. A lot of places don't rent to them, even if its something small like his. Thankfully we found a place and a landlord that gave us a chance. $625 a month, but we need to pay utilities and water and internet, and replace the air filter. Other than that, we are fine. And we can repaint the walls if we wanted to unless it was black.

[jackfaire]

However, I can't really be sold (no pun intended) on the notion that renting is superior overall to owning.

Personally I don't think either one is superior each one carries it's own set of perks and drawbacks. It depends on multiple factors.

Most namely what your looking for in a home.

[Jetfire]

I rented for years and years, and had no problems doing that. But last year I decided to take the jump and buy my condo, and I'm happy for that too. Brand new building so I should be safe from most major issues for a few years, and I do like that I now have more freedom to do things in the unit than I would in an apartment. Plus my costs are the same as what my rent was so budget wise it's not much different. That said, while I am urging a coworker to look into buying his own unit somewhere, I do try to avoid the blackhole argument.

[guywithashovel]

Personally I don't think either one is superior each one carries it's own set of perks and drawbacks. It depends on multiple factors.

Most namely what your looking for in a home.

Absolutely.

It's probably best to not look at your home as an investment, at least not in the sense of saving for your future.

Side note on that: Has anyone else noticed a tendency to refer to ANY large purchase as an investment? When I bought my car, a pamphlet I was given at the dealership said something like "Congratulations on your new investment!" How is a car an investment? I depreciates the very second you drive it off the lot.

But to get back to the topic, it is possible to build wealth with your home's appreciation, even after adjusted for inflation. Of course, the right conditions are needed for this. Nonetheless, in terms of your overall nest egg, the equity you build in your home is probably best seen as the "whipped cream on the sundae," the "icing on the cake," or whatever other similar analogy you prefer.

For myself, I am going to try really hard to get my mortgage paid off as soon as possible. In that sense, it's an investment in that, even I find myself with limited funds in my old age, at the very least I can have a paid-for home to live in, for whatever that's worth.

[Imprl59]

I think it really matters where you live. If you are in an expensive apartment or you are living in a house you would almost always be better off to buy the house because that much money is being spent every month anyway. If you're single renting a small apartment or a room in an apartment you would probalby be miles ahead in the end if you invested the difference. In my case I would rather live in a coffin than an apartment so I bought a house. The house will be paid for when I'm 60 and hopefully I can retire at that point and go play for a few years before I croak.


I noticed a few people in this thread think an advantage to renting is that you don't have to pay taxes. Who do think is paying for the taxes if you aren't? The property taxes are figured in to your rent just like my property taxes are figured in to my house payment. The only difference is I see the accounting at the end of the year and a renter doesnt. The same holds true for repairs.... Trust me your landlord isn't renting you the place so they can lose money on taxes or give you a free roof. You pay for everything just like a homeowner does.

[Andara Bledin]

The property taxes are figured in to your rent just like my property taxes are figured in to my house payment.

I forget about this, but both my property taxes and the insurance on the property are built into the mortgage, so I'm getting insurance and twice the space for less than what I was paying on my apartment.

You pay for everything just like a homeowner does.

Yes, but the expenditures are accounted differently.

As a renter, you are essentially paying "insurance" to the landlord as part of the rental fee. If something breaks that they have to fix, the renter comes out ahead. If nothing ever breaks, the landlord comes out ahead. In my case, after 4 years of renting, we never had anyone ever do anything for us, so the landlord came out ahead.

As a homeowner, unless you take the precaution of putting funds aside to cover emergencies (which everyone should have, anyway), then something breaking down can be a major burden.

^-.-^

[guywithashovel]

Where I live, real estate is quite cheap. Even before the bubble burst, it was pretty inexpensive compared to the rest of the country (most of it, anyway). After the bubble burst, the prices went down even more, and you can get some really sweet deals on some fairly nice houses. In fact, it can actually be cheaper to own than to rent here. For example, my cousin was paying about $150 more per month in rent than I pay on my mortgage, and his town home only had two bedrooms and about 1000 sq ft of living space, whereas my house has 1180 sq ft of living space, three bedrooms, and a full basement. In that case, I have to admit I would wonder why the person would still rather rent than own. However, I would not pester them about it.

One thing I would like about living in an apartment is not having to mess with the yard work. Granted, the feeling can be rewarding if you get the yard looking really great, but around here, in the mid to late spring to early summer it can seem like the grass grows an inch right after you shut the lawnmower off and put it back in the shed.

All in all, people just need to mind their own business and accept that not everyone is going to do things exactly as they do. You're entitled to your opinion if you think someone else is doing something stupid, but that doesn't mean you need to make your opinion known.

[jackfaire]

The only difference is I see the accounting at the end of the year and a renter doesnt. The same holds true for repairs.... Trust me your landlord isn't renting you the place so they can lose money on taxes or give you a free roof. You pay for everything just like a homeowner does.

Except I can walk away from an apartment if I find myself unable to pay the rent. A house I have to hope I sell it before it's foreclosed on or taken from me for unpaid taxes.

That was my point about the taxes.

If I am going to be in a place for more than 30 years the typical length of a mortgage then yes I will consider buying a house but right now any house I would want to live in the mortgage payments would be higher than what I can pay in rent and leash me to the house.


Edit: I watched my mom have to quick sell her house because even with the insurance money after my dad died she couldn't afford the mortgage payments and it was a race to sell before foreclosure so she got screwed. In her case it was unforeseen circumstances and I don't think my parents were stupid for buying a house they planned on living in for a long time but I do think that a single person like me looking to marry should wait to own a home so that I can make that decision with the person I will spend the rest of my life with.

[Andara Bledin]

Except I can walk away from an apartment if I find myself unable to pay the rent. A house I have to hope I sell it before it's foreclosed on or taken from me for unpaid taxes.

First, renting is not a guarantee that you can walk away; a lot of places require leases these days because of that sort of thinking. My former apartment was just starting up a system where if you didn't choose to sign a lease, you had to pay an extra $100 per month for the privilege. Thankfully, that never actually applied to us as they let it slide due to our house buying venture, even though that took about half a year longer than it had any right to.

And, owning a property doesn't necessarily tie you to it, although it does make picking up and leaving at a moment's notice moderately less feasible.

^-.-^

[bara]

My main primary goal motivation behind and greatest dreaming reason to have my own home is to be some where that my closest neighbor is far enough away that I wouldn't know if a freaking super nova went off in their yard.

Ive had me some bad neighbors. But that.... is another story.

[SkullKing]

I want to have my own home.

A small place that is mine and only mine.

I do not wish to have to deal with landlords, or having to ask permission to change things in my home.

I probably will rent a small apartment, But long term I want my little house.

Nothing watsoever against renting, if you feel it is the best for you.

[guywithashovel]

I'm seeing something in this thread that I tend to see fairly often on this forum.

Here are a few examples.

1. I think I might like to enter into a relationship, but the person might turn out to be a bitch/asshole and complete psychopath and might clean my bank account out and then leave me.

2. I think I might like to take that new job, but what if it turns out to suck? What if all my coworkers turn out to be jerks and try to use me, take money from me, etc.? What if I take the new job and then screw it up?

3. I could own a home if I wanted to, but what if all my circumstances change? What if something happens and I end up going into foreclosure? What if I end up getting tied to the house? What if the property value drops?

Now, once again, if you think renting is best for you, then all the more power to you. The point I'm trying to make is that it doesn't matter what you're thinking about doing in life, you can always think of all sorts of bad things that could happen as a result of your decision. Heck, I could sit here and think of all sorts of bad things that could happen as a result of renting. What if my neighbors suck? What if my landlord is an ass and I can't find one who isn't an ass? What if I move into an apartment building and someone in another apartment starts a fire and the whole building burns down?

Not trying to be a smartass. I'm just pointing out that any direction you take in life has potential bad consequences.

[Andara Bledin]

The "neighbor starts a fire" thing was actually a big worry for me at the apartment complex. I was constantly glad that most of the building I was in was actually vacant so I didn't have so many idiots to worry about (and most of my neighbors were idiots), though the drug dealing was pretty much constant. >_<

^-.-^

[AdminAssistant]

Fiance is feeling pretty itchy to buy a house. I am decidedly not. I'll be dissertating for the next 1-2 years, and then I don't know where my career will take me. We have no money saved up for a down payment, we have ~ $20,000 in combined credit card debt, he has $18,000 in student loan debt, and I have over $50,000 in student loan debt...and will accumulate more before I'm done with school. The LAST thing we need to worry about is a freakin' mortgage.

If you have a good landlord and live in a decent neighborhood, renting is no problem. It takes a lot of research, sure. But I've found that if you stay away from large complexes and big management companies, and rent a duplex/four-plex/home from an individual or a small company, you can get a nice place in a decent neighborhood for not a lot of money. I may not have a gym or tanning salon, but I pay $530 for a two bedroom/1 bath in a packed college town...and only live a 5-10 minute drive from my office.

[Aethian]

I'm with the school of thought, be married a YEAR before going house hunting. But of course I'm also of the thought I don't want to buy a house till I'm debt free. If I'm married I want US to be debt free. If that takes longer then a year then so be it.