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All the mortgage/tax rebate means is you spent 4 bucks over the price of the house to get back one. Loose the expense give up the deduction and you are richer for it.
1/2 of homeowners can't even itemize according to the irs.
Tax wise it is usually the renter who has the best deal. Most renters get to fly the empty seats. A renter couple gets over 12k as a standard deduction. Few even spend 1/2 that amount and so they get to take the entire deduction and get money back they never spent.
On the other hand most homeowners just about fill up the standard deduction or exceed it with money they actually spent.
The renter tax wise gets more money back in to piggy,the homeowner has taken money out of piggy to pay those bills and may see one dollar come back for every 4 taken out of piggy.
Have you always rented your entire life or did you own a home, sell it, and become a renter again?
Owned 2 homes, 1 co-op as personal residences through the years , also owned a load of investment property and rented the last 10 years.
we may buy a co-op again if renting gets to be more than buying. being i am retiring within a year i know longer invest as aggressivly as i did.
now for a bench mark i use a muni bond so in effect if i buy i will give up 15k a year in income since i will give up the interest but expenses will fall to about 10k a year.
Owned 2 homes, 1 co-op as personal residences through the years , also owned a load of investment property and rented the last 10 years.
we may buy a co-op again if renting gets to be more than buying. being i am retiring within a year i know longer invest as aggressivly as i did.
now for a bench mark i use a muni bond so in effect if i buy i will give up 15k a year in income since i will give up the interest but expenses will fall to about 10k a year.
This is why I am thinking of buying a house. Even the people on here who promote renting have bought houses in the past.
I will never own taxhog again. Ownership implies taxation/seizure/insurance/ to protect the owner from potential insurgents. Never.again.
I owned a farmette in Texas. The property was homesteaded. A new law was passed by the state legislature in approximately yr. 2000 allowing small self-incorporated municipalities to forcibly annex adjacent property if certain criteria were present. Mine was, and it was forcibly annexed against my will and without my consent. The city then told me what I could do with my land, how I could live there, sent me a bill, and raised the taxes sky high. I sold it.
Then I moved to a different state. I bought a bigger place zoned agricultural, with a 100 year old house and barn and a lovely water well, and set up for happily ever after. Until the county planning and zoning commission rezoned my property without my consent and against my will -again- to some land use they made up, called 'urban reserve'. After that they defined what I could do with my property and how I could use it, raised the taxes sky high, and sent me a bill. This state had no homestead law *protections*. I sold it months later. Buh-bye money pit.
Now I live in a cheap schitzy apartment I do not own. I have no homeowners or renter insurance. If the landlord raises the rent, I'll move. I own nothing that needs to be insured, taxed, or can be seized or rezoned by money hungry government. I'm done allowing my property to be confiscated by these thieving bureaucrats.
We.own.nothing. Not even a car - no car insurance either. Done.
Ownership in America = liability. I own nothing. Tax that azzhats.
I'm contemplating the same, down to the car. Owning anything in the US IS in fact a liability. Property tax is like a wealth tax. Insurance is a joke. Pay out the butt and when you need them they decide not to pay. Tiny Houses in trailers are starting to sound really attractive...
A lot of people that try to do the rent vs owning argument leave big chuncks of data out of their equation. It was mentioned earlier on here that someone "lost" 30k on their house therefore they will rent for now on. That is misleading because you still recovered equity that you would have never had renting. If you buy for 170k and sell for 140k then sure it looks like you "lost 30k." However if you were in this house for 10 years, then a comparible apartment/home rental would have costed you 1000/month or 120k over ten years...not even counting rental increases. So you "spent" 30k by living in this house, as opposed to spending 120k to rent.
Things like this are very important to consider in the rent vs owning argument. Also youre still paying for repairs, property tax, upgrades etc in an apartment/rental. The difference is its hidden in your rent bill.
People are also factoring in the cost of upgrades on a house. i.e. a 40k bathroom reno. These are completely voluntary and the difference between renting and owning is youre ALLOWED to do your own upgrades. If you rent a "newer upgraded" home/apartment then youre going to pay more in rent for the upgrades, they aren't free.
Well said. Mortgages are typically fixed, while rents go up. If you fall on hard times, you can rent out extra rooms in a house you own easier than an apartment you are not allowed to sublet.
No matter what you do these are your housing costs. Housing costs can be reduced in so many ways. Ownership is not the only way to improving cash flow.
Renting and investing in greater appreciating assets works as well or better. The renter who no longer needs multiple bedrooms can get a one bedroom and have greater cash flow than that homeowner with a paid off mortgage and a big house to heat ,maintain and air condition.
Our investments spin off far more then any rent increases.
there are advantages on both sides but most things folks think are advantages to owning are not really unique to owning, they are about improving cash flow. that cash flow can be improved either cutting expenses or getting more income. which road you take will be a personal decision but they end up at the same place if you are successful in your plan.
I bought my first house in 2008. It was an awful experience. I just sold it for a decent profit but that's a path I will never take again. Here's why:
Interest. I paid ahead on my mortgage and came out decent but if I'd paid the minimum amount each month, my $68,000 house would have cost me over $100,000 in the end. No thanks.
Maintenance. I plugged $15,000 into that thing doing most of the work myself. Nothing is built to last forever and it's blatantly obvious when you buy a house.
Inflexibility. I was stuck. I moved out of the house two years before I sold it and renting while still owning taught me something: being a tenant is much cheaper and simpler than owning a house. I will never buy a house again.
I'm in my early 30's and learned the hard way that owning a house just plain sucks. Renting is so much better because it's someone else's problem. I'm handy and can fix problems in a rental, for the most part. If I can't, I call someone to do it and don't pay for it.
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