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Old 03-22-2016, 03:07 PM
 
Location: Ponte Vedra Beach FL
14,628 posts, read 17,923,045 times
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Quote:
Originally Posted by mathjak107 View Post
our real estate and market investments blew our homes out of the water in returns even after subtracting rent and taxes . .

but that will be both time frame and local market dependent , but non the less that is exactly what happened for us .
Don't know about your particular houses. But had you bought a condo in some parts of Manhattan in the 70's - the appreciation would have blown any of your investments out of the water. I remember looking at a 2 bedroom condo on West 57th Street near 5th Avenue in the 70's. It was about $150k then. It's about $3 million+ now. My parents bought their house for $65k in the late 60's. And my father sold it for $1.5 million after my mother died in 2005.

I would agree these cases are rare though - and very location dependent. Robyn
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Old 03-22-2016, 03:08 PM
 
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our apartments we own did very well , far better then anything in queens but they are on central park south over looking central park . ceo barry gosin bought an apartment in the building for 5 million .
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Old 03-22-2016, 03:15 PM
 
Location: Ponte Vedra Beach FL
14,628 posts, read 17,923,045 times
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Quote:
Originally Posted by Submariner View Post
My parents had a few friends who were all into flipping houses. Buy an older distressed home, live in it 4 or 5 years as they remodeled, and then sell. They seemed to do really well with that. Or at least they thought they were doing well.

When I have seen my own friends flipping houses, it seemed to me that it was always a bit of a gamble. You invest so much time and money, and then hope they get back how much they invested.

Buying Single-Family homes just never made much sense to me. You pay way more than the actual purchase price [by the time you sum escrow and interest]. It seems to me like so much gamble.

We stuck to Triplexes, Fours and Five-plexes, and we were eventually able to pull out the equity that we had built-up and we bought our farm with the cash.
I'm not sure most people keep good accounting records of these things. Just like most people don't keep good accounting records of anything.

FWIW - after seeing flippers buying things like cheap toilets at Costco and planning to install them themselves - these people who aren't licensed to do anything - including plumbing - I would have zero interest in buying a house from a flipper.

I think it takes a certain mindset and set of skills to be a landlord. If someone has these attributes - fine. I know that neither I nor my husband has them. To paraphrase Joe Granville - if you don't know who you are - becoming a landlord is a hard place to find out. Robyn
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Old 03-22-2016, 03:21 PM
 
Location: Ponte Vedra Beach FL
14,628 posts, read 17,923,045 times
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Quote:
Originally Posted by mathjak107 View Post
the more expensive home will do better . a 250k home that appreciates 3% a year has a much less compounding in value then a 600k home that appreciates at the same 3% a year .
Which results in this:

Widening U.S. Home-Price Gap Makes Trading Up Harder - WSJ

Robyn
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Old 03-22-2016, 03:59 PM
 
15,733 posts, read 9,246,087 times
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Quote:
Originally Posted by freemkt View Post
But when you get old enough you do get the homestead exemption if you own your home, which beats not getting it if you rent.
You do understand that the exemption is only a small portion of the tax. You still have to pay.
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Old 03-22-2016, 05:17 PM
 
33,046 posts, read 22,043,990 times
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Quote:
Originally Posted by ringwise View Post
You do understand that the exemption is only a small portion of the tax. You still have to pay.

Every bit helps. The homestead exemption in Michigan represents 3/4 of the school tax rate and about 2/5 of the total property tax rate.

And it could be worse - when you rent, you get to bear the unfair excess tax PLUS your landlord's profit.
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Old 03-22-2016, 05:23 PM
 
33,046 posts, read 22,043,990 times
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Quote:
Originally Posted by Robyn55 View Post
Our homestead exemption in Florida (which has $ limits) is available regardless of age (I recall that we also have some additional tax breaks for low income seniors - but have never looked into them). Robyn

Yes, I was replying to a post from someone in Colorado which has a senior-=specific homestead exemption.

As is typical, Florida's SOH doesn't help renters - I guess it's okay if renters become homeless.
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Old 03-22-2016, 05:36 PM
 
Location: Forests of Maine
30,679 posts, read 49,437,227 times
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In Maine the 'Homestead Exemption' will drop the assessed value of a property by $10,000.

So it lowers my property taxes by roughly $80.60/year.
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Old 03-22-2016, 05:58 PM
 
Location: RVA
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It can be quite large in FL. My stepsons grandmother only pays $900 a year on a $200k home in Miami. It could be north of $3k, IIRC.
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Old 03-22-2016, 06:27 PM
 
20,728 posts, read 13,734,475 times
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Quote:
Originally Posted by Robyn55 View Post
I don't know if any investment - including the SP500 - will be a better investment than a house over any given period of time. Kind of depends on the investment - the housing market - and the house. Some houses - like waterfront houses in SE Florida - have been fabulous investments over the course of many decades (with the inevitable ups and downs we get over the years when it comes to Florida real estate). OTOH - I think those are the exceptions - not the general rule.

On my part - I have never looked at any house/condo that I've owned as an investment. It's a consumption/lifestyle thing. The most important things about owning as opposed to renting for me are: 1) no landlord can tell me what to do with the place; and 2) no landlord can ever kick me out if I don't want to leave.

I disagree with your statement that buying in an inexpensive area is a good idea. In terms of being an investment (as opposed to a place to live). Over the decades - I've seen that good fairly expensive areas tend to become better and only more expensive. Whereas the less expensive ones tend to stay "meh". Everything comes down to location - location - location - and available land. All of our parents had location in their favor. Their houses were torn down - and replaced with much grander places - after they sold. One house was in Bergen County NJ - and the other was waterfront in SE Florida. When it comes to my late inlaws' place in North Carolina - the value has pretty much gone nowhere over the course of 3+ decades. I would be wary of retiring and moving to an area with lots of land that can be developed. At least in terms of resale (if I cared about resale). Robyn

You can do your own research on the matter of investing vs. homeownership. There are many variable and depending upon who you listen to (and paid for the study) one is often touted better than the other.


Being as that may many experts still say investing (if done wisely) will yield better returns over the long run versus owning a home. The extent/size of the difference will again depend upon many variables up to and including how long someone plans to remain in said property. Buying a home and taking out a thirty year mortgage when either out of plan or circumstances you are going to move/sell in < fifteen often does not make sense.


People go on about the tax deductions of home mortgage and other costs associated, but those only kick in *IF* you itemize instead of taking the standard deduction. Also if subject to AMT the value of said deductions decreases.


As for not buying in "inexpensive" areas, again you need to broaden your view. People up and down the Northeast in particular parts of New York and New Jersey are sitting on gold mines as housing values have shot up. This is occurring even in areas once bombed out, drug/gang infested places like Bedford Stuyvesant, Bronx, Crown Heights, etc... Now would the same thing happen elsewhere? That is hard to say but we shall see with places like Detroit.
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