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One option is to invest in a house.
I'm researching the topic and will appreciate links to related HN discussions, analysis - calculations, past experiences, current market conditions & future predictions (interest rate increases et al) .... keeping duration of holding and investment capacity variable.
(especially in the bay area)
Anything less and you are exposing yourself to higher risks. I am not saying that you should not consider investment capacity etc at all but those should always be secondary motive, not primary unless you are an expert real estate investor (even they struggle in bad markets)
In the end it turned into a great decision for us. The house went up 350k in 4 years and we are looking to cash out and move to a cheaper area where I can take my remote job and pretty much buy a house in all cash and not worry about a mortgage anymore.
So it really depends on your situation.
Are you willing to stay in a house for 5+ years. If you want to sell.. can you ride out a dip in the market?
I'm a Bay area home owner. We bought 4 years ago. For us it was a great choice. Our our first child was 2 years old and were looking to find a place to settle down and live. We didn't want to worry about rent going up 30% to re-sign a lease. We wanted a place where she could go to school and not have to move around each time a lease is up. In the end it turned into a great decision for us. The house went up 350k in 4…
In my opinion, buying a house is never a good idea unless you intend to live in it yourself for at least 5-7 years (usual real estate cycle) AND you have put down at least 20%. Anything less and you are exposing yourself to higher risks. I am not saying that you should not consider investment capacity etc at all but those should always be secondary motive, not primary unless you are an expert real estate investor (ev…
I'm not sure how universal this is, but in my area this is also about the point where you're loan repayments will become cheaper than renting the equivalent. And your loan repayments will only go down over time, rent will only go up.
Buy one cheap and rent it. That's my plan anyway. Already have one. Our current one will be our second. And I've already begun eyeing the third. But do your homework and never pay more than it's worth. So yes. Buy one but only as an investment because it's a huge money pit regardless but at least when renting it you can write off a lot of it on your taxes and others are building the equity in the home for you.
Can you explain this please? Excuse my ignorance of the US tax system.
This sounds like a pretty shitty thing for the government to allow, giving existing home-owners a huge advantage to build up property portfolios over people not yet orable to get on the ladder. (similar to negative gearing in Australia where I live)
Buy one cheap and rent it. That's my plan anyway. Already have one. Our current one will be our second. And I've already begun eyeing the third. But do your homework and never pay more than it's worth. So yes. Buy one but only as an investment because it's a huge money pit regardless but at least when renting it you can write off a lot of it on your taxes and others are building the equity in the home for you.
Can you elaborate ?
In my opinion, buying a house is never a good idea unless you intend to live in it yourself for at least 5-7 years (usual real estate cycle) AND you have put down at least 20%. Anything less and you are exposing yourself to higher risks. I am not saying that you should not consider investment capacity etc at all but those should always be secondary motive, not primary unless you are an expert real estate investor (ev…
> AND you have put down at least 20%. I'm not sure how universal this is, but in my area this is also about the point where you're loan repayments will become cheaper than renting the equivalent. And your loan repayments will only go down over time, rent will only go up.