Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Owning nothing is now a luxury, thanks to a number of subscription startups

nytimes.com

Post reply on HN
Print view View original

291–300 of 304 posts

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#291

Post by esotericn »

JMTQp8lwXL wrote: post #69
apatters wrote: post #58

Earlier quoted context omitted.

Renting things is a financial tool and it can save you money. The calculation is simple. You estimate the difference between how much something costs and how much you can sell it for once you're done using it. That's your real cost to own it. Compare that number to the cost of renting it for the same time period. If the cost to rent is lower, renting is a better deal. For larger and more involved transactions (especi…

In an efficient market, shouldn't the cost to own and cost to rent be roughly the same? Otherwise, everyone would rush to the clearly cheaper option.

The idea that everyone will go for the cheaper option is predicated on the fact that human beings have literally no motivation other than to be perfect wealth accumulators.

In that model they wouldn't rent _or_ buy a bed, because they could just sleep on the floor. Or more accurately, they'd rent or buy whatever they think would maximize income including the cost of it; e.g. if having a bed maximized overall health over life or something then they'd buy or rent the most basic bed that fulfills the criteria of keeping their back healthy or whatever.

I own loads of furniture that's like, mine. It has value to me in the fact that it's my object, unencumbered by financialization.

Personally I seek to minimize financialization wherever possible. I'll pay slightly more up front for things to just delete the monetary stuff from my brain. I don't want to think about it, I want my life to work and money to exist at the side of it not in the forefront.

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#292

Post by openoi »

Zenbit_UX wrote: post #271
openoi wrote: post #248

Earlier quoted context omitted.

I wonder to what extent this influences what is known as the "endowment effect" in economics. The particular chair I am sitting in and have for months, is it really a more valuable one because it helps me remember? Now before we are quick to agree on a 'yes' -- to what extent do memories hold us back? Your teak bookcase for example reminds you of a positive accomplishment, and its loss would untether you, generally s…

I have to say, this whole trend screams of cognitive dissonance. "I can't afford to buy so I don't want to anyways..." sounds like one of the primary motivators. Renting expensive items? How's this different from leasing or renting a supercar you can't afford to show off to friends or clients? It's not. There's for sure some cases where this is a practical solution, like moving to another city for a year or two and g…

Regarding the dissonance, the this all has the side "if I don't own it, I won't feel the pain of loss" to it. Survival strategy in a precarious situation.

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#293

Post by suff »

noonespecial wrote: post #223
suff wrote: post #199

Earlier quoted context omitted.

Have you ever gotten a six figure check when you move out? Happens to buyers all the time.

Ever gotten a six figure bill on your way out? Happened to lots of buyers around 2008.

Yeah, once every 100 years...

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#294

Post by flukus »

gabrielhoch wrote: post #117
gambiting wrote: post #111

Earlier quoted context omitted.

Isn't SF an outlier in literally every financial question though? I'm currently in the process of buying a house in the UK and our mortgage payments are going to be a lot less than we were paying for rent in the same area. Like, 40% less. If you have any kind of stability and are not planning to move in 2-3 years it's crazy not to buy.

London is similar to SF, as an example I rent a relatively nice 2-bed flat for £1850/m, but after looking at what it would cost me to buy my mortgage would be at least in the region of £2500 + the maintenance fee from the building + repairs which I don't have to pay for as a renter. This pattern is really common in high cost of living cities.

> London is similar to SF, as an example I rent a relatively nice 2-bed flat for £1850/m

But what will the price be in 10 years? The mortgage will go down, especially if you pay above minimum repayments, your wages will go up (theoretically) helping you make those payments. The mortgage price will go down, bottoming out at $0 while the rent will always increase.

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#295

Post by tehlike »

quickthrower2 wrote: post #61
tehlike wrote: post #56

Earlier quoted context omitted.

The calculation gets more complicated with appreciating land, and leverage.

Also if you pay off the mortgage let's say $2k/m then you are $2k/m better off after tax. Otoh if you rent and invest you need to make $2k/m after tax (so maybe $4k/m before tax, depending on where you live etc.) from the investment to be in the same position.

Yes! You can also do 1031 and things like that to defer taxes. And value adds by doing renos.

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#296

Post by Thorrez »

mywittyname wrote: post #243
Thorrez wrote: post #95

Earlier quoted context omitted.

I doubt studios want to give Redbox a discount, because rentals cut into sales, which the studios care about more than rentals. Redbox operates because of first-sale doctrine. I assume Redbox pays the same as stores pay, which is indeed cheaper than what a consumer pays, but there's no discount especially for Redbox. Why do digital rentals cost more than physical rentals? Because first-sale doctrine doesn't apply to…

Studios used to give discounts to movie rental companies. An old girlfriend of mine managed one about $15 years ago and I seem to remember the prices for new DVDs being $4-6 on the order form. This was for movies that retailed in the $15-20 range. I think what happened is they started selling to Walmart et al for the same price.

That seems strange. I don't know what their motivation for that is, given I assume it would lose them money, and it's contrary to digital rentals being so expensive.

This article (admittedly from 2008) says studios hate Redbox. And that Redbox gets its DVDs from regular movie wholesalers (I assume where Walmart gets them too).

https://arstechnica.com/tech-policy/2008/10/universal-studio...

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#297

Post by amelius »

grecy wrote: post #290
amelius wrote: post #273

Earlier quoted context omitted.

> Keep it if it brings you happiness, after all, that's the point. But what if it doesn't make you happy AND selling/discarding it makes you unhappy?

...That sounds like a strange scenario. Can you give me an example?

https://en.wikipedia.org/wiki/Compulsive_hoarding

I suspect that hoarders are not necessarily happy with the stuff they collect, but they would become unhappy when they have to let go of it.

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#298

Post by kd5bjo »

refurb wrote: post #264
kd5bjo wrote: post #253

Earlier quoted context omitted.

Don’t forget that part of that $6225 is paying down principal, which will be recouped when selling or simply disappear from monthly costs after the mortgage is paid off. Also, most ownership costs move less with inflation than rents do, so in 10 years the comparison is $6225 2019 dollars vs $4500 2029 dollars. Also, once you hit 20% ownership, you no longer have to pay mortgage insurance. I haven’t run the numbers la…

which will be recouped when selling That assumes that you can sell the house for more than what you bought it at. You are correct that principle may be recouped and in addition, you get a mortgage interest tax deduction. However, you also pay 6% when you sell the place and maintenance costs (~1% per year) need to be accounted for. There are several assumptions you need to make for owning to be cheaper than renting -…

> That assumes that you can sell the house for more than what you bought it at.

Not necessarily; as long as the value of the house[1] doesn’t fall more than the principal you’ve paid, you’ll get more cash from the sale than you put up as a down payment. The trouble with buying on margin, though, is that it amplifies losses— the worst single day in the stock market[2] was about a 20% drop, but you get the same effect from a 1% drop in your house value if you hold the 95% mortgage that you described.

  [1] Folding transaction fees into the effective value
  [2] https://en.m.wikipedia.org/wiki/Black_Monday_(1987)

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#299

Post by RandomBacon »

lotsofpulp wrote: post #229
RandomBacon wrote: post #191

Earlier quoted context omitted.

> What definition... The one that people who make poor financial decisions use. The service providers didn't automatically drop your monthly rate after you the subsidized phone was paid off, so people felt like they might as well get a new phone since they were paying for it anyway. > What is stopping... Nothing except that people don't know any better. Tell everyone you know (without being annoying) how much you pay…

That situation is pretty far from any useful definition of force, in my opinion. If people are too lazy to do some basic arithmetic, that’s their problem.

Me too, unfortunately I know too many people who would call that being forced.

Re: Owning nothing is now a luxury, thanks to a number of subscription startups

#300

Post by apatters »

Thorrez wrote: post #296
mywittyname wrote: post #243

Earlier quoted context omitted.

Studios used to give discounts to movie rental companies. An old girlfriend of mine managed one about $15 years ago and I seem to remember the prices for new DVDs being $4-6 on the order form. This was for movies that retailed in the $15-20 range. I think what happened is they started selling to Walmart et al for the same price.

That seems strange. I don't know what their motivation for that is, given I assume it would lose them money, and it's contrary to digital rentals being so expensive. This article (admittedly from 2008) says studios hate Redbox. And that Redbox gets its DVDs from regular movie wholesalers (I assume where Walmart gets them too). https://arstechnica.com/tech-policy/2008/10/universal-studio...

First sale doctrine protects your right to rent out a copy that you own to one person at a time. Since movies are in high demand when they first come out and the demand tapers off quickly, this alone doesn't create a very appealing economic model for rentals. At $20 per DVD it's hard to make back your cost. So the studios have offered rental outlets deals in the past.

I actually don't know the details of Redbox. The specific example I remember is Blockbuster video, which used to get copies of movies for virtually free, in exchange for sharing a portion of their profits with the studios: https://www.quora.com/How-much-do-movie-rental-stores-e-g-Bl...

I think the studios agreed to this because of market segmentation, for any given movie there are people who have no interest in paying $20 to own it, but will pay a few bucks to rent it once or twice. If the studios didn't support this model they'd be leaving money on the table.

Post reply on HN