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Old 05-14-2011, 06:55 PM
 
Location: NJ
31,771 posts, read 40,698,345 times
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Quote:
Originally Posted by mistygrl092 View Post
Hmm, this might support your theory in a way:

» Homeowners Happier Than Renters

Now, this assumes that all you say is true and that not living from paycheck to paycheck makes one happier, etc.
im thinking more along the lines of who is building wealth, renters or owners.

Northern VA real estate blog
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Old 05-14-2011, 07:05 PM
 
5,546 posts, read 9,999,979 times
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Quote:
Originally Posted by CaptainNJ View Post
im thinking more along the lines of who is building wealth, renters or owners.

Northern VA real estate blog
Good luck with that one! I wouldn't even base my decision to rent or own on that at this point. Too much instability and the stock market is being propped up artificially so who knows where to invest these days.

To me it's all a crap shoot at this point. I would, however, try to find somewhere cheap to live and not in a high cost of living area. Been there, done that, always felt poor, didn't like it.
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Old 05-14-2011, 07:09 PM
 
Location: NJ
31,771 posts, read 40,698,345 times
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Quote:
Originally Posted by mistygrl092 View Post
Good luck with that one! I wouldn't even base my decision to rent or own on that at this point. Too much instability and the stock market is being propped up artificially so who knows where to invest these days.

To me it's all a crap shoot at this point. I would, however, try to find somewhere cheap to live and not in a high cost of living area. Been there, done that, always felt poor, didn't like it.
i dont really think the sole reason why homeowners accumulate wealth more than renters is the investment in a home. i think it has more to do with them being more disciplined with their finances. they are also more responsible because they are almost forced to be more responsible by being tied with an asset. like i said before, anyone can rent but not everyone can own.
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Old 05-14-2011, 07:16 PM
 
5,546 posts, read 9,999,979 times
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Quote:
Originally Posted by CaptainNJ View Post
i dont really think the sole reason why homeowners accumulate wealth more than renters is the investment in a home. i think it has more to do with them being more disciplined with their finances. they are also more responsible because they are almost forced to be more responsible by being tied with an asset. like i said before, anyone can rent but not everyone can own.
You're gonna get yourself in trouble here if you're not careful!

I don't know about your hypotheses honestly. I think we wouldn't be in this housing debacle if homeowners had been responsible, so that sort of throws them out the window. Many tried to own, many overbought, so I have a feeling that you might not be right. Of course, many were completely responsible and just lost their jobs. Would I sign up for a 30 year mortgage? I don't think so. I have, but very small ones where I knew I could go to McDonalds and still make payments. However, good luck getting a job at that place these days, but I digress.

I think maybe people who need more security might buy vs. renting or who want more control over their lives. I know for me I just wanted space and quiet and those were the primary drivers for me. That and the security thing.
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Old 05-14-2011, 07:26 PM
 
Location: NJ
31,771 posts, read 40,698,345 times
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Quote:
Originally Posted by mistygrl092 View Post
You're gonna get yourself in trouble here if you're not careful!

I don't know about your hypotheses honestly. I think we wouldn't be in this housing debacle if homeowners had been responsible, so that sort of throws them out the window. Many tried to own, many overbought, so I have a feeling that you might not be right. Of course, many were completely responsible and just lost their jobs. Would I sign up for a 30 year mortgage? I don't think so. I have, but very small ones where I knew I could go to McDonalds and still make payments. However, good luck getting a job at that place these days, but I digress.

I think maybe people who need more security might buy vs. renting or who want more control over their lives. I know for me I just wanted space and quiet and those were the primary drivers for me. That and the security thing.
i think the problem with the housing situation was you had renters being given an opportunity to become owners that really werent qualified to be owners. thats why its not good to offer 0% 3.5% or 10% down mortgages. these are people who arent responsible with money being given a lot of responsibility.

but its important to understand that im talking as a generality. i understand that renting can be a sensible financial option for responsible people. even i would prefer to be a renter than an owner (but i was in a unique position to get a lot more benefit from owning than most people). but for most renters, its more of a choice thats based on their abilities not their good senses.
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Old 05-14-2011, 07:50 PM
 
Location: Conejo Valley, CA
12,460 posts, read 20,087,251 times
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Quote:
Originally Posted by CaptainNJ View Post
are you trying to suggest that as a group renters are more frugal than home owners? remember, im talking about in the real world not in theory.
No, as I stated previously I have no idea whether renters are on average more frugal or not. I don't really care either.

You once again seem to infer causation from correlation, in terms of renting vs own the cheaper option is a matter of basic mathematics. Whether or not most renters are less frugal than owners has no barring on the issue. If renting is cheaper than ownership then one will have the ability to build more wealth overtime via renting and investing else where then they would by owning. Its hard to see how owning when renting is cheaper is some how frugal...
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Old 05-14-2011, 07:56 PM
 
Location: In my view finder.....
8,515 posts, read 16,184,600 times
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Wonderful post.............I'll be watching this thread.





Quote:
Originally Posted by ragnarkar View Post
For me, housing isn't a very high priority in my life and I don't wish to invest in my own home despite popular belief (although I have other investments.) It seems when you disregard housing, the cost of living between the high and low cost areas aren't radically different.

Case in point, one of my best friends who is currently unemployed lives in San Francisco and pays maybe about $500/600 in rent to rent a room to share a housing unit in a relatively good neighborhood. He doesn't own a car and just buys the monthly bus pass for about $50-60 or whatever to get unlimited transportation around the city. Figure about $70 for health insurance and $200 for food (mostly cooking rather than eating out) and he's spending less than $1000/mo of his savings to live in SF while looking for a job in the area.

He might spend less than that to live in, say, Omaha but since his career is in IT and most of his connections are in California, it makes much more sense to be located in San Francisco than Omaha while looking for the job.

I'm curious if any other people here manage their frugality despite living in a high cost of living area (i.e. California, East Coast, Chicago, Miami, DC, Raleigh, etc.)?
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Old 05-15-2011, 12:52 PM
 
30,897 posts, read 36,958,653 times
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Quote:
Originally Posted by mistygrl092 View Post
Good luck with that one! I wouldn't even base my decision to rent or own on that at this point. Too much instability and the stock market is being propped up artificially so who knows where to invest these days.

To me it's all a crap shoot at this point. I would, however, try to find somewhere cheap to live and not in a high cost of living area. Been there, done that, always felt poor, didn't like it.
I'm with you on the whole idea that no matter where you invest, it's a crap shoot. There's so much blatant intervention/rigging of the markets, it's beyond disgraceful.

I think at some point I may be forced out of the SF Bay Area because of the high cost. I think I mentioned this in another threat, but I think it would be cool to go to Peru for awhile.
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Old 05-15-2011, 01:01 PM
 
30,897 posts, read 36,958,653 times
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Quote:
Originally Posted by MrRational View Post
This wage aspect is truly ironic (even if Newport Beach Lifeguards can earn $90K)

My direct experience from living in the OC 30+ years ago and again just very recently looking for a spot *somewhere* within even 30 miles of the coast... is that CA real estate costs are the #1 factor in "affordability" (or lack thereof) there.

Everything else costs a bit (or a lot) more too, just as you have said, and if it were just the RE or just the everything else... it would have been a lot easier to justify making the buy-in I was looking to do for family reasons as much as anything.

But beyond the RE price aspect, which has always been a fairly constant low level insanity out there, the current government/debt issues there became the tip point in the decision to turn east (again) instead.

Well, by the time that those family reasons solidify (about ten more years worth) hopefully the CA state debt issues will have been resolved too... and I can reconsider. Not yet though.
Yes, pretty much everyone agrees. The somewhat higher wages in coastal CA don't make up for the cost of real estate. Everything else is also more, although nothing is as bad as the real estate.

Honestly, I think places like Phoenix or Vegas would be better places to live than inland SoCal. The cost of real estate is lower and wages are the same or maybe even a little better. Climate a little more extreme, but not that much.

The debt isssue is a big problem in a lot of states. CA is very bad, but it's not the worst, which is scary!

The really big problem isn't with state debt, though....it's with US government debt. The states are at least starting to make the very tough decisions necessary to get their financial houses in order. The Federal Government isn't even trying. The general public thinks the debt is a problem but think someone else (besides them) should be taxed or someone besides them should take a benefit cut; or that ending the wars will fix the fiscal problems--it won't. The lack of action on the part of the politicians and the denial on the part of Joe Public scares the heck out of me and definitely does not bode well.
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Old 05-15-2011, 03:48 PM
 
Location: NJ
31,771 posts, read 40,698,345 times
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Quote:
Originally Posted by user_id View Post
No, as I stated previously I have no idea whether renters are on average more frugal or not. I don't really care either.

You once again seem to infer causation from correlation, in terms of renting vs own the cheaper option is a matter of basic mathematics. Whether or not most renters are less frugal than owners has no barring on the issue. If renting is cheaper than ownership then one will have the ability to build more wealth overtime via renting and investing else where then they would by owning. Its hard to see how owning when renting is cheaper is some how frugal...
im not inferring that. you think i am because you want to take what i said and fit it into the argument you want to have. im just pointing out that renters as a group are less frugal than owners. so when you ask "why wouldnt renters be more frugal?" im just saying that (as a whole) they arent.
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