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Your story is what I have been preaching this entire thread. When you do the dollar per dollar, as well as quality per quality analysis, MOST of the time it's just better to RENT unless you want to invest in Real Estate Equity. If you want to invest in Real Estate Equity, it's like taking money from some other type of investment (a business, mutual fund, whatever) and putting it into the house in the form of additional repairs, more uptake, more appliances, more this and more that.
All this is FINE if you want to say in 20 years here's this house that I bought for $100,000 that's now $150,000 (without telling people that you invested another $60,000 into that house over those 20 years in repairs, uptake and new appliances which means you are technically at a LOSS) with about $30,000 in cash sitting in the bank.
But you could also say in 20 years that I've stayed in 5 different rental units across the country, with my Employers assisting with moving costs, and I have $225,000 sitting here in the BANK in liquid cash due to keeping money within an account and allowing it to compound/grow.
Who is in the better position after 20 years? All of this depends on the situation of the individual, but you have majority of the time (or for the politically correct SOME of the time) where buying is just NOT a good deal over renting.
Renting gives you:
- Mobility, freedom to move if better opportunities are in other places of the country or outside of it.
- Mobility, freedom to move if the place you are staying in goes to hell.
- Mobility, freedom to move if the neighbors and area around where you stay goes to hell with a bunch of Tyqueshas with 5 kids from 5 different thugs moving in, destroying and terrorizing the neighborhood.
- Mobility, freedom to move if your income changes and you need to downsize where you stay to save money on housing costs.
You LOSE all of these benefits when you Own. Plus, for those talking about the tax incentives, how about you just start a Home Based Business? Doing so allows you to take a number of personal expenses and convert them to business expenses, allowing them to be used as business deductions. This includes a portion of the amounts you pay in relation to your apartment, in which you would state that a portion of it is used to conduct business "at home".
You know after reading all this renting is better then
owning a house. You don't have to be tied down to a bad
neighborhood or job and can simply at your decision move to greener pastures.
Plus if you know how to invest your money then even rent
going up all the time don't matter.
All this is FINE if you want to say in 20 years here's this house that I bought for $100,000 that's now $150,000 (without telling people that you invested another $60,000 into that house over those 20 years in repairs, uptake and new appliances which means you are technically at a LOSS) with about $30,000 in cash sitting in the bank.
But you could also say in 20 years that I've stayed in 5 different rental units across the country, with my Employers assisting with moving costs, and I have $225,000 sitting here in the BANK in liquid cash due to keeping money within an account and allowing it to compound/grow.
Who is in the better position after 20 years? All of this depends on the situation of the individual, but you have majority of the time (or for the politically correct SOME of the time) where buying is just NOT a good deal over renting.
LOL. Did you enjoy composing that little fairy tale with all of your made-up figures to ensure that renting came out better? Do you feel better about yourself now?
Why don't you try that again with some actual figures. In the fall of 2012, I rented an oceanfront condo on Miami Beach for $2600/month. Three months later, I bought a unit for a little over $300k with $60k down because the mortgage + HOA fee came out to only $2400/month. Even without any appreciation, it was cheaper to own than to rent. Now, two years later, units are renting for $3,500/month and selling for between $550k - $599k.
So let's see you try to explain how continuing to rent would have been a better idea for me.
each one of us will have a different tail to tell based on our own actual experiences ,locations and deals.
like i said my ex wife is living in a co-op we bought in 1987 for 77k which has been payed off for a long long time . she is living there for 1/3 the cost of what that apartment gets for rent.
on the other hand if i had continued to own the house i had and never had the money to do my deals i would be quite a few mil poorer.
While no one can predict the future, I do not think houses will appreciate in value as much in the past. Many bought homes and lived in them for over 20 years and the value doubled and some tripled or more.
I think appreciation in the future will be more modest. Of course there are a lot of variables like location, growth of the area where house is located and just how much debt people are willing to take on.
LOL. Did you enjoy composing that little fairy tale with all of your made-up figures to ensure that renting came out better? Do you feel better about yourself now?
Why don't you try that again with some actual figures. In the fall of 2012, I rented an oceanfront condo on Miami Beach for $2600/month. Three months later, I bought a unit for a little over $300k with $60k down because the mortgage + HOA fee came out to only $2400/month. Even without any appreciation, it was cheaper to own than to rent. Now, two years later, units are renting for $3,500/month and selling for between $550k - $599k.
So let's see you try to explain how continuing to rent would have been a better idea for me.
Well, you are talking about a $300,000 property which is something totally different. I'm sure you could have found the same quality or similar quality for a property that was going for $300,000 in sale for $2,000 a month or so in rent, you just CHOSE a higher/bad rental quote.
But even in your example, you discuss the mortgage and HOA fee coming to $2,400 a month while the prior rent was $2,600 a month. What about the costs of maintaining the property, uptake, repairs, the costs of buying appliances upfront to put into the property? What about the fitness center and business center, along with the big swimming pools that SHOULD HAVE CAME with the rental if you were paying that much? What about the portion of the utilities included with the rent price such as Water, Trash and Gas? (I only pay $740 a month for rent in Michigan and get ALL of these features, bells and whistles)
When you were renting you had all of these things included, but as I stated earlier you don't want to have a BAD rental quote, I think your rental quote was too high and you should have shopped around.
The way I SHOP, if the property would have been bought for $300k with a $2,400 a month I could find some quality rentals at about $2,000 a month or maybe $1,200 a month. What I'm saying is, you could have enjoyed the same level of quality and amenities that a $300k house brings with a rental at a much lower rental cost if you shopped it properly. Then take the difference in what you would have been paying and invest it in a business you own/control/know about, or a CD or something, and I bet you come out better in 20 years.
The way I SHOP, if the property would have been bought for $300k with a $2,400 a month I could find some quality rentals at about $2,000 a month or maybe $1,200 a month. What I'm saying is, you could have enjoyed the same level of quality and amenities that a $300k house brings with a rental at a much lower rental cost if you shopped it properly. Then take the difference in what you would have been paying and invest it in a business you own/control/know about, or a CD or something, and I bet you come out better in 20 years.
What you are saying is totally made up and no way substainiated by fact because there is no way you'd have the data to cover all markets at all times.
What you are saying is totally made up and no way substainiated by fact because there is no way you'd have the data to cover all markets at all times.
Yes, quality per quality. As I stated earlier in the thread, right now I'm renting for $740 with all of the bells and whistles, I stay in the Suburbs, etc. To get the SAME level of quality in a house purchase, I would need to be looking at houses that start at $120,000 give or take which would also require me having to do the following:
- Join a gym, as my Free quality Fitness Center with my Apartment would be gone
- I lose the big resort like Swimming pools I enjoy now
- I lose the business center I enjoy now
- I have to buy major appliances upfront like washer, dryer, stove, refrigerator, etc.
- My utilities go up, because right now I don't have to pay for Water, Trash and Gas
Plus the overall AMOUNT SPENT in the housing related category goes UP, at about twice the amount I'm paying right now. That's the only way I can buy a house and maintain quality, quality that's similar to what I have right now in LOCATION and features.
What I'm saying in the above example, is that the guy is discussing a $300,000 property. When you list out all of the benefits and features of that property, he should have been able to find a Rental that included the same level of quality in LOCATION and features, for a much lower price than the $2,600 he was paying. He should have been able to find one for $1,200 - $2,000 a month give or take.
I could go online right now, taking the house he purchased, and pull up 7-10 solid listings that proves my point. You have to know how to Shop and manage this area.
I don't care what you are doing. Not all markets at all times will allow you to rent with the same amenities as buying. What you are saying isn't not fact and couldn't be possible for you to assert as such
I don't care what you are doing. Not all markets at all times will allow you to rent with the same amenities as buying. What you are saying isn't not fact and couldn't be possible for you to assert as such
Give me the link to a house you WOULD purchase, and I'll post some quality rentals within the area (defined as within 1-20 miles from the house) that are of high quality and good alternatives to purchasing the house.
Go ahead....
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