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Rent vs. Buy Visualization of Top 50 Cities

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Re: Rent vs. Buy Visualization of Top 50 Cities

#111

Post by teyc »

MichaelSalib wrote: post #101
teyc wrote: post #95

Earlier quoted context omitted.

ahh I've heard of that before. It is the idea that markets are perfect. But in reality, you only need to find one house that is improperly priced. Given banks are pretty tight on lending now, a borrower who can convince the bank to lend is better placed to offer a lower price.

Eh, what are the odds that you're actually good at finding such a house? I mean, everyone thinks that they're an above-average driver; people naturally overestimate their own skills. And most people have absolutely zero training or practical experience in assessing either real estate markets or houses. And buying a house is not an emotionally neutral task that most people can remain clinically detached from: most peo…

not that hard. It's only got only to be good enough. You are not an investor who has to invest $20M. For a 200K non-repeatable investment for someone willing to do the legwork, yes.

It's like finding a GF. Most people eventually settle on someone. If you start by saying "all the good ones are taken" then you are unlikely to get any where.

Re: Rent vs. Buy Visualization of Top 50 Cities

#112

Post by jacques_chester »

hugh3 wrote: post #107
jacques_chester wrote: post #81

Earlier quoted context omitted.

You're right that the carbon footprint is lower, but that doesn't change the fact that the collision of politics and economics has prevent urban density from increasing in Australia. We need both to release land and increase density or will are beggaring ourselves unnecessarily. As for stamp duty, the states rely on it too much to give it up.

Urban density has been increasing markedly in Australia over the past few decades, at least in Sydney. Not quite as fast as some folks would like (ie everybody with a spare quarter acre that they'd rather put up twenty units on) but density is certainly going up. In my opinion, though, what Australia really needs to do is to develop the infrastructure outside the major cities to persuade people to move out there. Aus…

Generalising enormously, the capital cities are already perched in the best locations. A successful city needs two major things: ready access to water and ready access to trade. That's why most major cities are on rivers or around major harbours.

Take my home town Darwin, for example. It is not destined to be one of the world's great cities because it is poorly positioned. There's buckets of water but due to the flatness of the country it's hard to dam. The harbour is large but shallow. The approaches from East and West are not friendly to bulk shipping.

Sydney, Melbourne, Adelaide, Brisbane and Perth are already hogging the best spots for large cities.

Re: Rent vs. Buy Visualization of Top 50 Cities

#113

Post by martin »

joubert wrote: post #39

I live in the city and am very curious why the foreclosure rate is shown as 0%.

People who have equity in their homes don't typically foreclose, and owners in NYC typically still do. Two reasons for that. First, property values in NYC haven't dropped as much as in other areas. Second, co-ops constitute a very large percentage of the purchasable housing in Manhattan (and in some of the outer boroughs as well). Nearly all co-ops subject you to a very invasive board approval process where you need to reveal everything there is to know about your income and assets. They want to know that you're making more than enough money to meet your expenses and that you have sufficient reserves to cover yourself through any period of hardship. Co-ops also usually require a sizable down payment (almost always at least 20%, sometimes even 100%). If you seem risky, you don't get in. So there's definitely less of an opportunity for shenanigans with exotic mortgage products and the like than in other cities.

Re: Rent vs. Buy Visualization of Top 50 Cities

#114

Post by jacques_chester »

whatusername wrote: post #108
jacques_chester wrote: post #87

Earlier quoted context omitted.

If it wasn't clear, I'm using "axis" in the sense of continuous values.

So then look for Cheap + Improving.

Not a bad idea, but it assumes that you can forecast local markets. And you're still left with mortgage risk.

Re: Rent vs. Buy Visualization of Top 50 Cities

#115

Post by scblock »

This data seems extremely unreliable. For example, it claims that in KC you might be better renting, then lists a buying price range of $200-$300k. Then hop over to Denver and it says buying might be better, with a price range of $100-$200k. I've lived in both cities and looked at houses in each, and it is much, much more expensive to purchase a house in Denver than in the Kansas City metro.

Re: Rent vs. Buy Visualization of Top 50 Cities

#116

Post by MichaelSalib »

teyc wrote: post #111
MichaelSalib wrote: post #101

Earlier quoted context omitted.

Eh, what are the odds that you're actually good at finding such a house? I mean, everyone thinks that they're an above-average driver; people naturally overestimate their own skills. And most people have absolutely zero training or practical experience in assessing either real estate markets or houses. And buying a house is not an emotionally neutral task that most people can remain clinically detached from: most peo…

not that hard. It's only got only to be good enough. You are not an investor who has to invest $20M. For a 200K non-repeatable investment for someone willing to do the legwork, yes. It's like finding a GF. Most people eventually settle on someone. If you start by saying "all the good ones are taken" then you are unlikely to get any where.

You are not an investor who has to invest $20M.

Most home buyers are looking for a home into which they'll be dumping the majority of their wealth. They have an incredible amount on the line.

For a 200K non-repeatable investment for someone willing to do the legwork, yes.

Why should we assume that many people know how to correctly do "the legwork"? Is real estate market assessment and pricing covered in school now?

I mean, most people lack the mathematical sophistication needed to understand their mortgages -- let alone whether buying is a good decision.

Re: Rent vs. Buy Visualization of Top 50 Cities

#117

Post by lwat »

jacques_chester wrote: post #63

I have come to the conclusion that buying to occupy is no longer a rational decision. Consider a grid. On one axis, housing purchases are cheap or expensive. On the other axis, the local economy is vibrant or moribund. Hence: * Cheap + Vibrant: Basically doesn't exist. * Cheap + Moribund: Bad place to buy, you're tied to a high-risk location. * Expensive + Vibrant: Purchase cost will eat up the advantage of the local…

Yea I kind of agree. From my perspective it only makes sense to buy if you really plan on living in the place for many years. And I'm too young for that kind of commitment so renting makes the most sense for me.

Re: Rent vs. Buy Visualization of Top 50 Cities

#118

Post by teyc »

MichaelSalib wrote: post #116
teyc wrote: post #111

Earlier quoted context omitted.

not that hard. It's only got only to be good enough. You are not an investor who has to invest $20M. For a 200K non-repeatable investment for someone willing to do the legwork, yes. It's like finding a GF. Most people eventually settle on someone. If you start by saying "all the good ones are taken" then you are unlikely to get any where.

You are not an investor who has to invest $20M. Most home buyers are looking for a home into which they'll be dumping the majority of their wealth. They have an incredible amount on the line. For a 200K non-repeatable investment for someone willing to do the legwork, yes. Why should we assume that many people know how to correctly do "the legwork"? Is real estate market assessment and pricing covered in school now? I…

Oh yes, I agree with that. It is a lot of money for a lot of people. A house is probably the single biggest purchase that people will ever make in their lifetime. Unless they don't buy a house, in which case, it wouldn't be the single biggest purchase in their lifetime. :)

There is nothing extremely sophisticated about borrowing money. But I heard that some extremely sophisticated lenders have lost their shirt recently, so one cannot be too careful.

Re: Rent vs. Buy Visualization of Top 50 Cities

#119

Post by whatusername »

snagage wrote: post #105
whatusername wrote: post #104

Earlier quoted context omitted.

Moral Dilemma? It seems a logical way of treating it. The additional income is treated as taxable income. The additional expense (aka Interest) is treated as a deductible expense.

1. It's deducted against personal income. 2. Nobody is allowed to do it on their own home

So is a company car if you're a sole trader... But I can't write off my normal car.

It's relatively consistent.

Re: Rent vs. Buy Visualization of Top 50 Cities

#120

Post by aik »

grav1tas wrote: post #59
aik wrote: post #28

I'm confused about the populations. For example, it mentions the population of Kansas City is 143K. Wikipedia says 482,299, and "greater" KC is closer to a million. What exactly is measured here?

It appears to be using the data from KCK. If it's pulling the population data from there it might be a safe bet that everything else is from KCK, too. That being said, regardless, I think the entire bit about KC being ranked up near San Fran and NYC is way off. There's very reasonably priced housing in the greater metro area. I don't think the sample they're using on this site is very accurate at all. I find it reall…

Yeah if it's specifically from KCK, depending on where in KCK that high buy dollar could make sense. But for a lot of parts of KCK, and the Missouri side, 200-300k is ridiculously high compared to what I would expect. Most suburbs in general have much lower prices.
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