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Other than flexibility I see no advantages to renting. I find it hard to believe that taxes and maintenance, as well as the earnings you make with the money you did not spend on a house, will equal the monthly check that goes out the door month after month forever. As mentioned if you don't want to deal with maintenance buy a condo.
I had read that retirees can have a problem obtaining a lease because there are no checks to garner? I find that hard to believe, who could be better prepared to pay rent than a retiree with a SS check and one would assume savings?
well believe it . we have made far far more money renting and investing else where .
our house i bought in 1987 was 169k , today it is 766k . the same money in the fidelity insight growth model i have been following since then would be 4.50 million in nothing special fidelity funds . even the s&p would not be that far behind . .
you could subtract out every penny of rent and taxes and buy more than 2 homes today.
we rent ,and continue to invest elsewhere .
we may buy a co-op next year but i am still on the fence about it .
we can save 6k a year buying if you take only rent vs maintenance on the co-op . however we will give up a minimum of 12k a year in income on the money now tied up in the co-op .so cash flow would be 6k less buying. renting is still the cheaper deal . .
As a renter, you are always at the mercy of the landlord. The rent may increase, or they may decide to sell. You'll need to factor in how many times you can afford to move or what your rent 'ceiling' is.
I really think that is an overused exaggerated argument. first let me say my experience is with smaller apartment buildings. not those 2000 unit complexes.
OP landlords want to find good tenants. I live in Philadelphia and I'm actually getting ready to purchase my first rental as an investment. My siblings own apartment buildings in NYC. When a landlord gets a great tenant, they will bend over backward to keep them. if you think moving is expensive ask a landlord how expensive it is to have an unoccupied unit and the expense that comes from fixing up units after a tenant leaves to get it ready for showing.
My brother does his hardest to not increase the rent and when he does it's usually barely above the increase in COL AND he is quick to prove why he has to increase it. The majority of times it increase because of an increase in property taxes, he almost always eats the increase in utilities.
In Philly about 1/2 the people rent, a landlord here is not going to go hog wild and raise the rent, there is simply too much competition.
Dealing with a lending institution is a one-time affair and it's been totally painless every time. Once we close, the mortgage payment goes on Autopay and we never deal with the lender again. One our houses was a cash buy, so there was no lender involved at all with that one. But renters are stuck dealing with the landlord every time they have a problem.
Once again, the reality is there are not these "evil" overlord landlords that do nothing.
And just like some deadbeat renters, a landlord can be super charming and the house look beautiful, but when something goes wrong, they don't come out to fix it.
And that's why God invented Tenant associations.
Once again, I can only talk about the area I'm in. A landlord cannot take "weeks" to fix the HVAC. are you kidding me, one call to the city ESPECIALLY if you are a senior and all heck would break lose.
In the winter they cannot shut off your heat and in the summer they are not allowed to shut off your air.
Folks we are not talking 1930 lower west side immigrant tenements.
Op, first check out if in Portland landlords need business licenses. Here in Pa they do. that means not any Joe, jane or Harry can hang a shingle and call himself a landlord. Next if he does have a licences most likely he has certain obligations on what he has to provide.
If the stove breaks he can't take 5 weeks to fix it. stuff like that. Here in Philadelphia landlords must give renters something called a certificate of rental suitability. units must have fire protection, fire alarms, working appliances, stuff like that. broken things must be fixed. Here's one of the things I had to sign as I'm apply to be a landlord
The landlord must provide a central heating system or an approved separate permanent heating
system for each rental house or apartment. Heating equipment must be safe, properly installed, and
adequate to heat the entire dwelling unit.
• In buildings with two or more dwelling units and in rooming houses, the landlord must supply heat at
a temperature of 68 degrees for each apartment from October 1 through April 30. Cooking equipment
or appliances cannot be used for heating.
and yes, stuff breaks but once again a landlord could be in hot water (lol excuse the pun) for not providing basic services.
Listen, I think there are some really good arguments for owning and not owning a home. It depends on where you are in life and what your goals are. I just really believe that all these arguments about landlords raising the rent astronomically t every year and other stuff are greatly exaggerated.
I sold my home in NJ. My property taxes went up a heck of a lot faster than any rent increase. When I retire I will sell this house and it will most likely be the last house I will own.
Last edited by eliza61nyc; 12-08-2017 at 05:44 AM..
well believe it . we have made far far more money renting and investing else where .
our house i bought in 1987 was 169k , today it is 766k . the same money in the fidelity insight growth model i have been following since then would be 4.50 million in nothing special fidelity funds . even the s&p would not be that far behind . .
you could subtract out every penny of rent and taxes and buy more than 2 homes today.
we rent ,and continue to invest elsewhere .
we may buy a co-op next year but i am still on the fence about it .
we can save 6k a year buying if you take only rent vs maintenance on the co-op . however we will give up a minimum of 12k a year in income on the money now tied up in the co-op .so cash flow would be 6k less buying. renting is still the cheaper deal . .
People who don’t have the discipline or stomach to invest always think real estate is the greatest thing since sliced bread.
I lived in NYC back in the late eighties and I can attest that your numbers are accurate. Right about 1987, I finally had enough money to buy a co-op in Park Slope. I didn’t. Though I didn’t do it for financial reasons, it turned out to be one of my better money moves. My friend did buy - a co-op in Park Slope for 175K. He was forced to sell 3 years later when his job moved. It sold for 125k. Judging by recent sales, the place is probably worth about 900k. Sorry, but not a great investment relatively speaking.
Yet people in NYC, SF, LA......name any other desirable coastal city......always think they are better off financially by buying. It’s just not the case.
well believe it . we have made far far more money renting and investing else where .
our house i bought in 1987 was 169k , today it is 766k . the same money in the fidelity insight growth model i have been following since then would be 4.50 million in nothing special fidelity funds . even the s&p would not be that far behind . .
you could subtract out every penny of rent and taxes and buy more than 2 homes today.
we rent ,and continue to invest elsewhere .
we may buy a co-op next year but i am still on the fence about it .
we can save 6k a year buying if you take only rent vs maintenance on the co-op . however we will give up a minimum of 12k a year in income on the money now tied up in the co-op .so cash flow would be 6k less buying. renting is still the cheaper deal . .
Well in our case we are downsizing to a low COL area, we are talking about home prices in the $150,000 range with property taxes about a grand. If I took that $150,000 and invested it I highly doubt I will cover the $1,300/month I will pay in rent even factoring in maintenance and taxes. I would need a 10% tax free return to just break even.
it is hard to say . most of us never rent what we would buy .
i would have to spend over a million bucks to buy a home here . but i can rent in a luxury building with pool , tennis court , 2 bedroom ,2 bath for a mere fraction of those costs.
all my investing whether stocks , or our real estate , the money we did not tie up in a personal residence by owning earned far , far more renting and investing elsewhere than owning something.
luckily we sold our 2nd home in the pocono's when we did . it sold 2 years ago for 60k less than we sold it for in 2012 .
Well in our case we are downsizing to a low COL area, we are talking about home prices in the $150,000 range with property taxes about a grand. If I took that $150,000 and invested it I highly doubt I will cover the $1,300/month I will pay in rent even factoring in maintenance and taxes. I would need a 10% tax free return to just break even.
every thing is a trade off. My reality is that in all probability I won't be moving to a low col area. It has nothing that I need to have the type of life I want in retirement. lol, like when people say they are moving south, i do want to move South but I plan on beachfront living so no way am I going to get a beachfront house for 150K. lol I'll be lucky if it doesn't run 1.5 mil
I think the point that folks who rent have is that renting no longer automatically = losing money. The object of me investing and saving is so I do not have to relocate based on cost, I want to be able to relocate based on achieving the lifestyle I want.
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