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Old 02-28-2015, 02:09 PM
 
Location: Great State of Texas
86,093 posts, read 72,544,616 times
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Quote:
Originally Posted by ncole1 View Post
Most homeowners don't have enough itemizable deductions to exceed the standard deduction anyway. When they do, it is typically by a small amount such as $2,000. A 25% tax bracket deduction of $2,000 over the std deduction would only take $500 off your tax bill.



This is already accounted for, because only the mortgage interest was taken as a cost, not the entire principal and interest payment.



see above.
You are assuming everyone will have a mortgage.

I owned one home for 10 years. In that 10 year timeframe I replaced the hot water heater and A/C unit. It was a new home and didn't need any extensive annual maintenance.

When I sold it was for twice what I paid to have it built.

Now I'm in a second home, paid for by cash and the rest of the cash from the sale of my first home is invested.

For me owning is the preferred route. And this home I'm in now I bought for under county appraised value because the owners were in financial trouble and I was a cash buyer. I'm already $60K ahead of the game if I sold today just for the county appraised value (prime farm/ranch land).
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Old 02-28-2015, 03:18 PM
 
Location: Near a river
16,042 posts, read 18,988,950 times
Reputation: 15649
Quote:
Originally Posted by boogie'smom View Post
I rent. That said, I wouldn't rent in an apartment complex or high rise for the reasons some of you give for not wanting to rent at all. Under most circumstances, I would rather rent from a big company than an individual.

It is just as hard to find the perfect rental as it is to find the perfect place to buy. Difference is, if the rental doesn't work out, you can move. After my lease expired, I am month to month, but in my state, landlord and tenant are still bound by the original agreement unless written notice is given. Landlord can give notice and raise my rent or make other changes to the original lease. If I don't like it, I can move.

Once you have downsized and dealt with the first move, it's not a big deal. I am still getting rid of things. The next move, if it comes, will be easier. It might even be exciting to have a reason to relocate.
I agree, but age when you do all this relocating has a lot to do with it. A landlord or corp. raising rent significantly and causing one to move at the age of 75 or 80 is no picnic for the elder. That is why I'm cautious about the idea of renting (and of course, the neighbor wild card).
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Old 02-28-2015, 03:36 PM
 
Location: Great State of Texas
86,093 posts, read 72,544,616 times
Reputation: 27566
Quote:
Originally Posted by newenglandgirl View Post
I agree, but age when you do all this relocating has a lot to do with it. A landlord or corp. raising rent significantly and causing one to move at the age of 75 or 80 is no picnic for the elder. That is why I'm cautious about the idea of renting (and of course, the neighbor wild card).
My MIL has been renting for the past 5 years.
The owner sold the unit and she has just been informed of a significant rent increase.
She's 71 and this has upset her pretty well because she just does not want to entertain the idea of having to go look for a new apartment and then the entire process of moving out and in.

She's told me numerous times she likes where she's living. I told her to just pay the increase if she can afford it. She can afford it but she just doesn't want to pay it.

You can't always have your cake and eat it too.
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Old 02-28-2015, 04:08 PM
 
Location: middle tennessee
1,926 posts, read 991,367 times
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Quote:
Originally Posted by newenglandgirl View Post
I agree, but age when you do all this relocating has a lot to do with it. A landlord or corp. raising rent significantly and causing one to move at the age of 75 or 80 is no picnic for the elder. That is why I'm cautious about the idea of renting (and of course, the neighbor wild card).
I think that within the next ten years I will be able to move my possessions in the back seat of my car

In my case, the cost of upkeep on my home was rising at an alarming rate for various reasons. This winter alone, my utility bills would have been astronomical. Renting has been a relief.
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Old 02-28-2015, 04:20 PM
 
Location: Out there somewhere...a traveling man.
39,553 posts, read 47,780,182 times
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Quote:
Originally Posted by ncole1 View Post
You don't get all your money back with a house unless you have a very high rate of appreciation sufficient to cover your costs. If mortgage interest is 4%, property tax is 1.5%, insurance is 0.5%, maintenance 1%, and repair 1%, the sum is 8%. Your house would have to appreciate at 8% annually in order to break even.

Since this normally doesn't happen over long periods, you still have a net housing expense (which can be compared to rent).
My house is free and clear, I live in a high appreciation area (location location location) never had a mortgage on it, my repairs are negligible as I do my own, my taxes are negligible also as is my insurance. I'll get everything back plus whatever I have invested vs giving money to a stranger and still having other costs and people telling me what I can or cannot do.
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Old 02-28-2015, 07:01 PM
 
12,708 posts, read 9,984,291 times
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Quote:
Originally Posted by HappyTexan View Post
You are assuming everyone will have a mortgage.

I owned one home for 10 years. In that 10 year timeframe I replaced the hot water heater and A/C unit. It was a new home and didn't need any extensive annual maintenance.

When I sold it was for twice what I paid to have it built.

Now I'm in a second home, paid for by cash and the rest of the cash from the sale of my first home is invested.

For me owning is the preferred route. And this home I'm in now I bought for under county appraised value because the owners were in financial trouble and I was a cash buyer. I'm already $60K ahead of the game if I sold today just for the county appraised value (prime farm/ranch land).
Technically, you are correct. But I would argue that a more complete discussion must account for the opportunity cost of the capital you have tied up in that home. If there is no mortgage, this is 100% of the value. If you did not own it, this sum could be invested to generate income.

But hey, if you found such a great bargain, and come out far ahead, more power to you!
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Old 02-28-2015, 07:08 PM
 
12,708 posts, read 9,984,291 times
Reputation: 9515
Quote:
Originally Posted by wit-nit View Post
My house is free and clear,
Opportunity cost of capital...

Quote:
Originally Posted by wit-nit View Post
I live in a high appreciation area (location location location) never had a mortgage on it, my repairs are negligible as I do my own,
What is "negligible"? Less than 1% of the value annually?

Quote:
Originally Posted by wit-nit View Post
my taxes are negligible also as is my insurance.
What is "negligible" for taxes? Less than 1.5% of the value annually? Less than 1%?

Quote:
Originally Posted by wit-nit View Post
I'll get everything back plus whatever I have invested
Even after opportunity cost?

Quote:
Originally Posted by wit-nit View Post
vs giving money to a stranger
You gave money to a stranger when you bought it, right? Or are you saying you bought it from a family member or friend? In any case why does it make a financial difference if you know the seller or not?

You give money to a stranger when you buy food, gas, and clothes, right? How is this a problem?

Quote:
Originally Posted by wit-nit View Post
and still having other costs and people telling me what I can or cannot do.
You're always going to have other costs, and you're always going to be confined by something. Either you are confined by a landlord, or you are confined by having to fix things on their schedule, not yours (i.e. you don't tell the roof when to leak, etc.) You pick your costs, and you pick your confinement.

It is certainly possible that due to low expenses you can come out ahead in the medium term (5-10 years) but you have to consider everything, not just brush it off as "negligible". The latter term is reserved for costs so small you wouldn't even put them in your budget (e.g. $2.50/month for soda from a machine).
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Old 02-28-2015, 11:30 PM
 
Location: Out there somewhere...a traveling man.
39,553 posts, read 47,780,182 times
Reputation: 110429
^^^ You have me rolling on the floor with laughter, what confused world are you living in.

What part of when I sell I get everything back that I invested in plus a profit.
If I rented I'd get zero back.
Quite simple isn't it.
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Old 02-28-2015, 11:57 PM
 
71 posts, read 64,586 times
Reputation: 80
Our solution is to own our own home but in a foreign country where it's much more affordable and labor to take care of the yard etc is also affordable even on a social security income.
No rent, no chance of rent going up (only utilities).
In this situation (moving to a cheaper-to-live foreign country) buying is preferable imho.
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Old 03-01-2015, 01:34 AM
 
2,980 posts, read 2,708,437 times
Reputation: 5631
Quote:
Originally Posted by pdsnickels View Post
Our solution is to own our own home but in a foreign country where it's much more affordable and labor to take care of the yard etc is also affordable even on a social security income.
No rent, no chance of rent going up (only utilities).
In this situation (moving to a cheaper-to-live foreign country) buying is preferable imho.


Have you lived in this foreign country yet? Beware that living in a low cost of living country abroad is not all that it is usually cracked up to be by the people who want to sell you books, magazines, CDs, and seminars. Are you aware that the cost of living can rise and in a few years might be the same as it is in Florida? This is what happened in Costa Rica and Panama City, Panama. Have you planned for currency fluctuations? I can remember when the Euro was 88 cents, and when it was $1.60. Now it is $1.10. The dip in the British pound has wreaked havoc on Brits retired abroad.
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