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Maybe for YOU personally renting is better but not for everyone. I've been a landlord myself. Have many a good friend that own rental properties. Some have owned them long enough that they are paid for and most of the money coming in from rent is free and clear profit. Your landlord happened to buy a rental home in an area that was and is still overbuilt and homes for sale are a dime a dozen. Many renters in your area have been kicked out of their rentals because the "owner" was foreclosed on. Something that very well could happen to you IF the owner decides to skip out on the mortgage. Or when the market in your area turns he could then put it up for sale and the buyer want it as their personal property. All this moving can and does add up. We personally do not like to move and are very happy w/ our home and location. No need to sell but it wouldn't matter anyway as I'm not in an overbuilt area w/ houses flooding the market.
Renting for ME and MY family is NOT the better option. If your a financial expert then you might realize for many of us that buying and owning our homes is the BETTER financial decision to make and not renting. Even in this "day and age" there are plenty of people out there in the same boat as we are where owning/buying IS the best option over renting.
My investment advisor is worth $11M from the latest Forbes article and sold his house 3 years ago, still waiting on the sidelines. He rents two homes in CT and FL.
All things paid to the OWNER of said property by the RENTER in their monthly RENT. At the end of the day when the owner has paid off the house he is still going to collect the same amount in rent and RAISE the rent accordingly over time. There is not a owner of rental property out there that does not include ALL expenses of owning a rental property in the rent charged.
The hypothesis assumes that landlords all have an equal cost basis. The landlord purchasing their property 20 years ago has a tiny mortgage and thus much more room to negotiate down rent prices. The sucker buying the home 2 years ago can't compete. He/she either gets foreclosed on, makes up the difference out of pocket hoping for a rebound, or sells the house for a possible loss.
As the economy falters, families will consolidate just like our European counterparts to reduce costs, driving housing demand further downward. Mr. Toll from TB had a similar theory, but mistakenly used it to justify inflated home prices.
View...your posts are levelheaded and make sense. Moderator cut: personal attacks
Also, my landlord is worth millions, I know him personally, he is not about to foreclose or throw us out! That is why each individual should examine his family's situation. And I reiterate that BUYING IS NOT FOR EVERYONE. Read my post, I clearly state that according to an individual's situation, RENTING is sometimes best.
I really don't see this as either/or - we all have different circumstances and preferences, so there is no right or wrong if someone chooses to rent vs. buy. We all do what we feel is best for our own particular situation.
As I have said before, I am a person who enjoys the feeling of owning my house for various reasons. But I know plenty of people who prefer to rent for their own reasons. As long as we are all doing what we CHOOSE, and feel good about it, then it's the right thing to do, as individuals.
My investment advisor is worth $11M from the latest Forbes article and sold his house 3 years ago, still waiting on the sidelines. He rents two homes in CT and FL.
Depends on how much he was able to save renting versus paying the mortgage, taxes, insurance, HOA fees, upkeep and repairs. Could be a lot, could be a little, could be break even.
You do realise when someone rents a home, that the rent has to be enough for the landlord to pay the taxes, insurance, upkeep and repairs dont you?
The landlord takes your rent, pays the taxes, insurance, upkeep, mortgage, and pockets the difference..
Oh, I know plenty of owners out there who are not including all expenses to the renter, my landlord does not make money on the deal we have. He just cannot sell right now for some reason or another.
So don't make generalizations, momof2...
People have different opinions and different ways of life...some of us PREFER to rent and NO we are not stupid for doing so!!
I work in the financial field and have been doing so for the last 13 years...I should know what is best for MY family.
Renting is many times better than buying especially in this day and age
Then your landlord isnt really a landlord.
Landlords live by making profits on the spread.. If your landlord isnt making money, then he's a poor investor.. not a landlord.
You do realise when someone rents a home, that the rent has to be enough for the landlord to pay the taxes, insurance, upkeep and repairs dont you?
As others have pointed out, this ignores the fact that there is more than one possible rental in any given area. Thus the costs you list above have to be balanced with the rents that other landlords charge. In many areas, this means that landlords are losing money each month on their properties.
But even if they're not, many rental properties were purchased before the RE bubble hit. In those cases, the total cost for the landlord is going to be below what you could currently buy the house for.
Quote:
The landlord takes your rent, pays the taxes, insurance, upkeep, mortgage, and pockets the difference..
Anotherwords, you saved $0 by renting..
Again, this ignores the fact that in many areas of the country, home prices went up way faster than rents. Until that anomaly corrects itself, you can save money renting in those places.
Did you catch his Wall St. Unspun radio show last night? Gee, I wonder who whizzed in his cheerios?
You know you're investing with the right guy/gal when they are laughed at by the talking heads on Fox/CNBC/Bloomberg/etc. This is especially true when they refer to you as anti-American, an anarchist libertarian or otherwise.
As others have pointed out, this ignores the fact that there is more than one possible rental in any given area. Thus the costs you list above have to be balanced with the rents that other landlords charge. In many areas, this means that landlords are losing money each month on their properties.
But even if they're not, many rental properties were purchased before the RE bubble hit. In those cases, the total cost for the landlord is going to be below what you could currently buy the house for.
Again, this ignores the fact that in many areas of the country, home prices went up way faster than rents. Until that anomaly corrects itself, you can save money renting in those places.
If landlords are losing money on their properties, then they are very poor at negoating the properties and over paid.
As for the prices of properties going up faster then rent, what does that have to do with a landlord? Landlords bought properties 10 years ago, at their current market. If these new inflated prices of properties are more then the market will bear for rent, then the landlords did a very poor job at buying the properties at a price the rental rates would not bear to cover the expenses..
That makes them very poor investors, not landlords, because landlords are in this to make money, not lose, when properties are over inflated to "buy".. then true landlords/property investors, do not buy, they wait until the market rents will cover the expenses..
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