11–20 of 44 posts
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…
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.
>>you can write off a lot of it on your taxes 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.
>>you can write off a lot of it on your taxes 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)
Earlier quoted context omitted.
>>you can write off a lot of it on your taxes 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)
It is insane, and yes you can "expense" mortgage interest against your taxes, and in the case of a rental, a portion of everything else too. Incentivizes owning houses.
In a fair world, this would only be allowed on the first buy-to-let property. Anything above that is just not in the interest of society in general, especially in cities like SF and Sydney that are running out of space to and/or NIMBY behaviour.
Earlier quoted context omitted.
> 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.
I put down 5% and had to get PMI. But even after that my payments were less than renting an equivalent house. So 20% is definitely not a cut n dry rule.
Earlier quoted context omitted.
It is insane, and yes you can "expense" mortgage interest against your taxes, and in the case of a rental, a portion of everything else too. Incentivizes owning houses.
(Again excuse any ignorance of the tax laws in the US) In a fair world, this would only be allowed on the first buy-to-let property. Anything above that is just not in the interest of society in general, especially in cities like SF and Sydney that are running out of space to and/or NIMBY behaviour.
The detailed reality is a bit more complicated of course (there are rules specific to real estate) but that's the essence.
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…
That's such an awesome position to be in.
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…
What was the original price of the house?
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.
>>you can write off a lot of it on your taxes 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)
http://homeguides.sfgate.com/irs-rules-mortgage-interest-ded...
The intention is the incentivize people to own their own home, it is not to incentivize them to build up property portfolios. Indeed that would be perverse.
I'm sure you can show a loss on an investment with real estate just like you can with any investment but I think continuing to buy subsequent houses and showing losses on all of them as part of your personal tax returns might raise some flags.