Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Take a look at that fancy calculator and play with the numbers. Also, realize if you buy a house and renovate the kitchen their numbers don't reflect that. Buying is house is NOT a "no brainer" even with prices having come down, they are still overinflated and taxes are a very serious and unavoidable liability to consider before you buy.
Make sure you bump your taxes up to over 2% when you're entering numbers.
There doesn't really seem to be much of a benefit except that you have slightly more freedom in owning as opposed to renting. If you want to convert the basement into an arcade, you can. Can't do that if you rent. Is that worth the trouble? Maybe, maybe not.
Buy a house because you want one. If not, rent. I rented for years and was fine with that. At some point, I wanted my own space to do what I please, nice kitchen, fix up a yard, get a little pool, park my car off the street. When values were skyrocketing, no one thought renting was a good idea. When housing declines, renters are geniuses. When prices balance out, homes will continue the slow and steady increase they have made for a century. There is not much more land and people want a family home. Some things don't change. Whatever works best for a person is what they should do. Renting vs buying a home is not a valid comparison. Buying is an investment. Renting is not. Investments have inherent risk and potential hassles along with the opportunity for growth. You may make money or you may lose money on your home while you own it. You'll have neither of those concerns when renting.
It is no wonder all of the 20 and 30 something people are all moving off of Long Island.....with the way housing prices are still jacked up here and crazy taxes, if you are in your late 20's or early 30's you would be a fool to buy here.
Even if you saved up 100K for a down payment on a 400 or 500K house, that still leaves you with a huge 300 or 400K mortgage with say 5% interest.
Not to mention paying 12-15K in property and school taxes, which go up every year like clockwork.
I am in my late 20's and have been renting the last few years since I moved out of my parents house when I was 23, and frankly, I am in no rush to buy anything (unlike my friends, who are blinded by the "American Dream" of home ownership) as well as the social pressures from their families, wives or gf's thinking it is some status symbol.
With my current renting situation I have a good deal where I have a really nice 1 bedroom apt and ALL of my utilities are included (including electric), I do not pay any property or school taxes, and I pay no interest on my rent like I would on a mortgage. At the end of the month I still have enough money left over to save a little and go out with my friends for some entertainment (movies, drinks, dinner, whatever)....not living paycheck to paycheck trying to pay a 2500 or 3K mortage...
I still do not see the benefits of home ownership for the young people of LI in my age bracket, even though it is forced down our throats by our families and significant others. (You do not know how many times some ppl I talk to say you are throwing your money away renting).
What does everyone else think?
Owning a home is part of the American dream, so previous generations tend to see it this way. Home ownership has become part of the economy as well, so the gov't is interested in the middle class taking huge mortgages.
At one time, if you were renting and had the opportunity to own a home fo rroughly the same money, you would jump. This has changed though.
The other aspect to consider is the 20-something expects to buy the same house they grew up in while not considering the hard work and dedication their parents put in to it.
I was on the fence just like the OP a couple of years ago. Without question, for me, I'm very glad I made the plunge to become a homebuyer although it was daunting at first.
+ Owning your own property with no annoying landlord telling you what you can't do.
+ Not hearing the tenants above you
+ Having a backyard
+ Entertaining Guests/Company
+ Summer BBQ's
+ My previous 2 bedroom apt rent approaches my mortgage payement (via rent increase) every year. At some point in the next decade it will surpass the monthly mortgage payment.
+ I can sell my house and get some return on investment in the future.
It is no wonder all of the 20 and 30 something people are all moving off of Long Island.....with the way housing prices are still jacked up here and crazy taxes, if you are in your late 20's or early 30's you would be a fool to buy here.
Even if you saved up 100K for a down payment on a 400 or 500K house, that still leaves you with a huge 300 or 400K mortgage with say 5% interest.
Not to mention paying 12-15K in property and school taxes, which go up every year like clockwork.
I am in my late 20's and have been renting the last few years since I moved out of my parents house when I was 23, and frankly, I am in no rush to buy anything (unlike my friends, who are blinded by the "American Dream" of home ownership) as well as the social pressures from their families, wives or gf's thinking it is some status symbol.
With my current renting situation I have a good deal where I have a really nice 1 bedroom apt and ALL of my utilities are included (including electric), I do not pay any property or school taxes, and I pay no interest on my rent like I would on a mortgage. At the end of the month I still have enough money left over to save a little and go out with my friends for some entertainment (movies, drinks, dinner, whatever)....not living paycheck to paycheck trying to pay a 2500 or 3K mortage...
I still do not see the benefits of home ownership for the young people of LI in my age bracket, even though it is forced down our throats by our families and significant others. (You do not know how many times some ppl I talk to say you are throwing your money away renting).
What does everyone else think?
I'm 29, and eight months into a 30-year mortgage on a 400k house in a great neighborhood with a little less of a tax burden than what you state above. It's been great so far and I don't regret it for a second.
The way I looked at it back when I was younger, was this -- I was born on Long Island, which means that if I'm going to stay close to family and friends, there are some sacrifices to be made. Oh well, I dealt with it. I got over the ridiculous generalization that living with your parents after college meant you were a lazy bum (and/or that your parents were enablers) b/c I knew that this one of the sacrifices that needed to be made. My wife did the same -- and once we were engaged in 2009, we were in line to have close to $80k in savings for a possible house purchase.
My wife and I make a combined salary that is in line or very slightly above the median income for the area. Contrary to popular myths, we have enough to eat hot, tasty meals; meet with friends on weekends; go out to restaurants on a reasonable basis; spend on our hobbies; go away overnight/for a weekend; etc. Even after paying our bills. Of course, all this is possible provided you can practice moderation. If you're the type that purchases every single thing that you see and desire, then maybe house ownership isn't for you at the present time.
I have no issues with those who are more comfortable renting or do not see the benefits of owning a house. It is a perfectly understandable position. I considered moving out when I was a year or two out of college, but ultimately I decided against it. And I also understand that not everybody has the opportunity to spend a few years living with their parents and building a nice savings. I was lucky in that regard, I admit. But you also have to be willing to take advantage of that opportunity when you have it, and not let it go by the wayside because you're afraid of being judged by people who probably aren't all that important in your life anyway.
I just think that if you have ties to Long Island, and you want to stay on Long Island, you have to come to grips with the fact that there are financial restrictions here that require some sacrifice. Just like if you're goal is to live somewhere for the lowest price, you'll need to move elsewhere and sacrifice your ties to Long Island. That's just the way it is. Almost every single person that I grew up with and remain close with has recognized these realities, and has chosen to either remain on Long Island or test the waters for a few years in NYC or Queens before returning, despite the popular belief that every 20-something leaves LI in the dust as quickly as possible. Some rent, some own homes.
Buy a house because you want one. If not, rent. I rented for years and was fine with that. At some point, I wanted my own space to do what I please, nice kitchen, fix up a yard, get a little pool, park my car off the street. When values were skyrocketing, no one thought renting was a good idea. When housing declines, renters are geniuses. When prices balance out, homes will continue the slow and steady increase they have made for a century. There is not much more land and people want a family home. Some things don't change. Whatever works best for a person is what they should do. Renting vs buying a home is not a valid comparison. Buying is an investment. Renting is not. Investments have inherent risk and potential hassles along with the opportunity for growth. You may make money or you may lose money on your home while you own it. You'll have neither of those concerns when renting.
You contradict yourself. In terms of an investment, buying a house on LI is a pretty bad one. If you have 100K, from a purely financial perspective, putting it down on a house is not the right move. However, buying a house isn't just about investing. It's about putting down roots, having a family, and having a HOME. That's where the argument lies for buying a house.
Purely from a $$ perspective, it's a losing argument.
You contradict yourself. In terms of an investment, buying a house on LI is a pretty bad one. If you have 100K, from a purely financial perspective, putting it down on a house is not the right move. However, buying a house isn't just about investing. It's about putting down roots, having a family, and having a HOME. That's where the argument lies for buying a house.
Purely from a $$ perspective, it's a losing argument.
The numbers do not support your opinion.
Go back 50 years and Real estate is a literal roller coaster. When you have tripled your money, suddenly RE is a "Good" investment. It's easy to talk like you when you are trying to get in and still can't afford to do so even in a down market.
You contradict yourself. In terms of an investment, buying a house on LI is a pretty bad one. If you have 100K, from a purely financial perspective, putting it down on a house is not the right move. However, buying a house isn't just about investing. It's about putting down roots, having a family, and having a HOME. That's where the argument lies for buying a house.
Purely from a $$ perspective, it's a losing argument.
I'm not sure about that. Renting in a nice neighborhood in NYC is a costly affair that would easily cost more in the long run than buying a house in LI at what I consder to be rock bottom prices.
You contradict yourself. In terms of an investment, buying a house on LI is a pretty bad one. If you have 100K, from a purely financial perspective, putting it down on a house is not the right move. However, buying a house isn't just about investing. It's about putting down roots, having a family, and having a HOME. That's where the argument lies for buying a house.
Purely from a $$ perspective, it's a losing argument.
Tried to rep you, all repped out!
Agreed - financially, it tends to be a money sink. Yes, you build equity, but at the expense of paying huge upfront interest costs even accounting for tax deductible interest and taxes.
Toss in necessary home maintenance and associated expenses with furnishing a place.
One other thing to consider - even if you have substanital equity in a home, it may be prohibitive to gain access to it due to lack of credit provided by "any" bank (we saw this with revocation of HELOC lines or reductions in availability during 2008/2009). You can not take a piece of aluminum siding or brick to the car dealership to purchase a car or pay for your kids college education.
It is however, a place of permanence if you are able to stay in the home by either owning outright or ability to pay monthly carry cost.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
At the end of the month I still have enough money left over to save a little and go out with my friends for some entertainment (movies, drinks, dinner, whatever)....not living paycheck to paycheck trying to pay a 2500 or 3K mortage...
