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Old 04-08-2021, 01:04 AM
 
87,925 posts, read 85,639,886 times
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Quote:
Originally Posted by LeavingDetroit View Post
Yikes I don’t think anyone here has mentioned the capital gains exemption when you sell your primary residence. So assuming you own for awhile and the home appreciates, and you later wish to sell, up to 500k is tax free unlike if you used your savings to buy other investments.

For me though, I’m currently renting and as an emotional matter just don’t like it!
I don’t feel as committed to the neighborhood, I don’t like that it is not up to me whether someone changes out the crappy linoleum floor, my rent feels like it’s going down the toilet and I have nothing to show for it.

I had wanted to relocate a year ago to move to a lower COLA where we could buy. But then came the pandemic so we stayed put. I’m looking at Zillow etc and the same quality of homes we were exploring 9 months ago or so have increased around 15%. And the inventory seems very low.
I certainly figured it in my own calculations I posted.

But when looking at housing costs vs renting that exclusion does not come in to play since you are utilizing the investment ..

There is also a zero capital gains bracket for other investments that may be able to used yearly to exclude tax
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Old 04-08-2021, 10:41 AM
 
Location: Victory Mansions, Airstrip One
4,563 posts, read 2,847,707 times
Reputation: 5281
Quote:
Originally Posted by Bluefox View Post
It certainly isn’t for me, at least right now. I had been planning to buy (first time) and am finally in the position to this year, but in these conditions absolutely not. It feels like such an unhealthy market. I don’t really care that interest rates are so low, I’m not about to enter that rat race. I’ve spoken with several realtors who have told me now is not a good time to buy (they’re friends/family, not looking at me as a potential client). Maybe they’re wrong and this is the new normal. If so I don’t want any part of it. I have other avenues for growing wealth.

At any rate - I will wait until it’s a buyer’s market again and I don’t really care when or if that happens.
Could be a long time before we have a true "buyer's market", although I agree that buying at this moment is not a great idea unless a person has few options. I'd hope the inventory situation improves within a couple of years.

I bought my first home in 1992. That happened to be near the end of the RTC era, so prices were still good, but starting going up at a pretty good clip... averaging 1% a month for a few years. At some point I got it in my head that I'd move into a bigger place at the next market crash. Well, years and years went by and no crash. I moved once, moved again... no crash. By chance we were ready to buy a house in AZ in 2012, and again in just happened to be at the end of a housing bust. So really, 30 years had passed between great buying opportunities, for me anyway.

There can be buyer's markets that are localized, but that doesn't help the person who won't relocate to these places.

Last edited by hikernut; 04-08-2021 at 12:10 PM..
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Old 04-08-2021, 12:28 PM
 
4,621 posts, read 1,953,599 times
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Where home ownership paid off for us is when we paid off the mortgage and retired. The cost of owning our home without a mortgage, including RE taxes, maintenance, utilities and insurance is equivalent to the rent on a small apartment. Been there, done that. That's the reason we bought a house in the first place.
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Old 04-08-2021, 12:39 PM
 
7,267 posts, read 5,517,971 times
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It will be nice here in a few years when my home is paid off, I will have all that money to do whatever with. If I was renting, that rent would be continuing forever. Aside from having the home with no mortgage, I have the equity in it, over double from what I paid, sitting around $2.2 million now. If I was renting, the owner would not only be paying off the mortgage with the rent, but also have all the equity, and I would still be having to make the rent.
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Old 04-08-2021, 01:06 PM
 
87,925 posts, read 85,639,886 times
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Quote:
Originally Posted by k350 View Post
It will be nice here in a few years when my home is paid off, I will have all that money to do whatever with. If I was renting, that rent would be continuing forever. Aside from having the home with no mortgage, I have the equity in it, over double from what I paid, sitting around $2.2 million now. If I was renting, the owner would not only be paying off the mortgage with the rent, but also have all the equity, and I would still be having to make the rent.
In our case Over the last 15 years we saw our house go up 3x in value that we owned and sold 15 years ago ....the money we got from the house went up more than 10x in value invested , rent went up less than 30% more from what we were paying

Selling and renting and investing the money and not buying another house has been a slam dunk for us
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Old 04-08-2021, 03:24 PM
 
Location: OC
8,956 posts, read 5,169,546 times
Reputation: 7095
Quote:
Originally Posted by JonathanLB View Post
You just have to do what works for you, whatever makes sense. Houses can be a lot of work, I know I’ve already pumped a about $150K to $200K into my house and I just bought it in 2019. Probably another $100K or so to go for the upgrades I want. But for me nothing beats the pride of ownership and being able to do whatever I want to the house. That and the fact if you rent an apartment, it won’t be quiet, they’re all built like crap. I can’t sleep through noise and I don’t sleep when other people do (more like 5 am to 1 pm), so renting absolutely doesn’t work for me. It works fine for others though!
Yeah, I don't think there's an absolutely correct answer. It just all depends.
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Old 04-08-2021, 03:53 PM
 
Location: Orig.Maryland, Calif., now North Texas
16 posts, read 2,997 times
Reputation: 31
I'm sick of renting. Hopefully we can buy our first home in a couple of years. We're renting a house now.. we rented apartments before. Never again! I really want space for a garden, just my own colors and style. Very important! As for what someone said above, it's good as a renter to not have to pay for maintenance, but our maintenance company sucks so I might as well pay my own company to fix things.
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Old 04-08-2021, 05:59 PM
 
Location: Colorado
15,400 posts, read 9,747,163 times
Reputation: 28686
Renting has served my purposes for most of my adult life and still does at this time. I figure that owning will be "for me" after I've spent the years I need to in Arizona, and returned to Colorado where I want to live long term, and when I've got the down payment squared away to get a house.

One thing I've always liked about renting is the feeling of agility, like if my situation changes in some way or I find that I don't like living in a place, I can easily get through my lease term and pull up stakes and move if I need to. I've always seen home ownership as more of a long term commitment, though I know a lot of people who do not see it that way.
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Old 04-08-2021, 07:06 PM
 
7,267 posts, read 5,517,971 times
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Quote:
Originally Posted by mathjak107 View Post
In our case Over the last 15 years we saw our house go up 3x in value that we owned and sold 15 years ago ....the money we got from the house went up more than 10x in value invested , rent went up less than 30% more from what we were paying

Selling and renting and investing the money and not buying another house has been a slam dunk for us
It would be pretty market dependent. In Miami where I live, there is no way in hell would I ever find a house similar to what I am in now that rents lower than my mortgage, and that is back when I bought it, let alone now with its value, not even remotely close to it. So to save via renting, I would have to seriously downgrade.

But really excited about being mortgage free soon.
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Old 04-08-2021, 07:38 PM
 
8,879 posts, read 6,814,663 times
Reputation: 18206
I am contemplating between getting a smaller new home or just renting
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