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Old 01-21-2018, 05:24 PM
 
Location: Aurora Denveralis
2,980 posts, read 1,017,500 times
Reputation: 3798

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Quote:
Originally Posted by freemkt View Post
I didn't even say that much. For many homeowners, the intangible benefits of owning their home are valued more highly than financial returns.
Oh, sure. My "rent" is zero; I win. But it's zero because some oddball secondary reasons made a cash purchase of a home the best option for me.

Quote:
For some renters, the intangibles of renting are more highly valued than the intangibles of owning, and/or they are able to build wealth faster OUTSIDE of home equity than within it.
Spin me a tale of renters who accumulate wealth faster because they are renting, not owning on reasonable terms. If the tale involves anyone who is not a very high earner on a shortish stay in a very high COL location - that is, they're robbing the payroll bank while living as cheaply short-term as possible - I'll be completely fascinated.
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Old 01-21-2018, 05:38 PM
 
4,718 posts, read 2,255,657 times
Reputation: 8729
Quote:
Originally Posted by freemkt View Post
If you make a mortgage payment, you are retaining (some of) your wealth, plus you are capturing ALL value appreciation.

Try doing THAT with rent.
Not necessarily true. Your closing costs + PMI + maintenance at an can easily by higher than the annualized mortgage payment, especially in the early years of a mortgage. It is quite common to be actually down in net worth immediately after the purchase of a home. It is also possible the down payment on the home, invested instead in the stock market, has greater returns over a given period. Eventually a homeowner will (usually) come out ahead if they stay in the house long enough, but people move all the time so always using an assumption of a homeowner spending their entire life reaping the benefits of their decades old purchase are faulty.


Quote:
Originally Posted by freemkt View Post
Yes, it is possible for a renter to increase their wealth by investing elsewhere (outside of home equity) but most renters do not have that option.
Well this would be a completely different statement than the one you made earlier saying renters were unable to retain wealth, but we both know you'll be back here in two weeks saying the exact same (incorrect) thing then backtracking when called on it.
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Old 01-21-2018, 05:55 PM
 
Location: DFW - Coppell / Las Colinas
29,920 posts, read 34,526,470 times
Reputation: 35918
Quote:
Originally Posted by freemkt View Post
1) I don't think a single burger flipper can afford / qualify to mortgage a single-family detached house anywhere in this country.
My Hispanic cleaning lady owns 3 houses she rents out. It can be done.

Do you have a handicap that has prevented you from advancing yourself?
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Old 01-21-2018, 05:59 PM
 
33,046 posts, read 20,714,185 times
Reputation: 8928
Quote:
Originally Posted by Quietude View Post
Oh, sure. My "rent" is zero; I win. But it's zero because some oddball secondary reasons made a cash purchase of a home the best option for me.


Spin me a tale of renters who accumulate wealth faster because they are renting, not owning on reasonable terms. If the tale involves anyone who is not a very high earner on a shortish stay in a very high COL location - that is, they're robbing the payroll bank while living as cheaply short-term as possible - I'll be completely fascinated.

I believe there are a number of renters here who are accumulating wealth faster by renting than they would be by owning.
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Old 01-21-2018, 06:05 PM
 
24,714 posts, read 26,785,278 times
Reputation: 22709
Quote:
Originally Posted by Quietude View Post
I think that's too cynical, politically. It's more correct to say that the US economy (and national budget, as a result) is dependent on a socioeconomic structure that keeps a large portion of the population in economic servitude. The US merely promotes the environment in which the corporate world churns out its wealth.

But of course, they all do so on their own, without no help from nobody and thus owing nothing but those pernicious taxes they can't completely dodge, no matter how many legislators they own.
I don't see the permanent underclass as solely the result of greedy corporations. That''s part of the story, but only part. Government policy that enables out of wedlock child bearing and a popular culture that treats it as no big deal also contributes a great deal to the size of our impoverished population.

If you don't promote a value system that celebrates deferred gratification (and America doesn't), you're going to get more poor people.
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Old 01-21-2018, 06:10 PM
 
33,046 posts, read 20,714,185 times
Reputation: 8928
Quote:
Originally Posted by lieqiang View Post
Not necessarily true. Your closing costs + PMI + maintenance at an can easily by higher than the annualized mortgage payment, especially in the early years of a mortgage. It is quite common to be actually down in net worth immediately after the purchase of a home. It is also possible the down payment on the home, invested instead in the stock market, has greater returns over a given period. Eventually a homeowner will (usually) come out ahead if they stay in the house long enough, but people move all the time so always using an assumption of a homeowner spending their entire life reaping the benefits of their decades old purchase are faulty.



Well this would be a completely different statement than the one you made earlier saying renters were unable to retain wealth, but we both know you'll be back here in two weeks saying the exact same (incorrect) thing then backtracking when called on it.

There is a time frame associated with profitably owning a home - it is generally accepted that buying a home is NOT the best financial move if you're going to move in 18 months....and also that buying a home IS the best financial move if you plan to stay put for 10 years.

Renting inherently entails not retaining wealth. Only if a renter is able to invest - and most cannot - are they able to at least partially offset the loss of wealth attributable to renting.
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Old 01-21-2018, 06:15 PM
 
33,046 posts, read 20,714,185 times
Reputation: 8928
Quote:
Originally Posted by Rakin View Post
My Hispanic cleaning lady owns 3 houses she rents out. It can be done.

Do you have a handicap that has prevented you from advancing yourself?

That's a FAIL.

She owns three houses she rents out because she is self-employed and does not have a middleman (employer) siphoning profit.

How much do EMPLOYED cleaning ladies make? Not so much.
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Old 01-21-2018, 06:19 PM
 
33,046 posts, read 20,714,185 times
Reputation: 8928
Quote:
Originally Posted by Rakin View Post
My Hispanic cleaning lady owns 3 houses she rents out. It can be done.

Do you have a handicap that has prevented you from advancing yourself?

Well I don't have a car, so I'm not able to zip around town to clean several houses in a single day.

Having a car expands one's ability to make money more than does a high school diploma.
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Old 01-21-2018, 06:20 PM
 
Location: Paranoid State
12,672 posts, read 9,425,981 times
Reputation: 14930
Quote:
Originally Posted by Quietude View Post
It's more correct to say that the US economy (and national budget, as a result) is dependent on a socioeconomic structure that keeps a large portion of the population in economic servitude.
LOL! That's a good one.

Quote:
Originally Posted by Quietude View Post
The US merely promotes the environment in which the corporate world churns out its wealth.
Business is the primary way in which wealth is created, GDP per capita goes up, and our standard of living goes up. Corporations are one form of business, alongside partnerships and sole proprietorships (and a couple other obscure forms).

Corporations have been the greatest force for improving standards of living that has been invented by mankind.
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Old 01-21-2018, 06:20 PM
 
4,718 posts, read 2,255,657 times
Reputation: 8729
Quote:
Originally Posted by freemkt View Post
Renting inherently entails not retaining wealth. Only if a renter is able to invest - and most cannot - are they able to at least partially offset the loss of wealth attributable to renting.
Wrong again. There is no rule that the amount one pays for shelter can only be "partially offset" by investment gains, it is entirely possible for someone to grow their net worth because their investments returns exceed their housing costs. One might also have a job with a salary that covers rent, so accumulated wealth can continue to grow even if investment returns don't match rent costs.

Of course this is neither here nor there since you were claiming renters cannot accumulate wealth, a claim you appear to now be admitting was false but will very likely make again in the near future.
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