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Why You Should Never Buy a Home Again

jamesaltucher.com

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Re: Why You Should Never Buy a Home Again

#41

Post by zeroplus »

gr366 wrote: post #22

The title on the post itself (and the slug in the URL) is "Why I Am Never Going to Own a Home Again" (emphasis mine). In the article, the author states "there are many reasons to not buy a home," and the reasons are from his perspective, which presumably is what his friends are asking for. However, the title here on HN makes it sound like the author is suggesting nobody ever buy a home again — probably not his intent…

Read the article. The author is definitely saying nobody should buy a home again. He structured the article as advice using his own personal experience.

Re: Why You Should Never Buy a Home Again

#42

Post by fr0sty »

rbranson wrote: post #28
joezydeco wrote: post #4

Earlier quoted context omitted.

..."and don't mind being at the mercy of inflation when your landlord jacks up your rent 10% with a month remaining on your lease."

Outside of property tax increases (at least in the State of Tennessee), the landlord can't increase rent on you if you've got a lease contract. Things are much stricter in many other states.

I think the GP was saying that the landlord was announcing a 10% increase in rent with only 30 days notice not an increase of rent for the last month of the lease.

Re: Why You Should Never Buy a Home Again

#43

Post by zeroplus »

diego wrote: post #17

Why is the title of the submission different from the article's? "Why You Should Never Buy a Home Again" sounds trollish. It's does not apply to a large number of people for whom buying a home is indeed a good idea. Please edit the submission title to match your current title: "Why I Am Never Going to Own a Home Again"

He structured the article as advice to others. The title is interchangeable with you should never own.

Re: Why You Should Never Buy a Home Again

#44

Post by zeroplus »

acangiano wrote: post #10
joshuaheard wrote: post #3

I could easily refute all the points in that article if I had the time. I'll suffice to give this example: "A" buys a $100,000 house, "B" rents a $100,000 house. Both pay about $1,500 per month. At the end of 15 years, "A" owns an asset worth $100,000, "B" owns nothing. You decide.

Depending on the market, there are times when renting is actually cheaper than buying, also considering that you pay taxes, repair, and maintenance on a house you own. See here for an elementary explanation: http://www.khanacademy.org/video/renting-vs--buying-a-home?p...

You arent taking into acct the investment value of the downpayment. Plus the benefits of having high liquidity

Re: Why You Should Never Buy a Home Again

#45

Post by true_religion »

jeffepp wrote: post #32
true_religion wrote: post #19

Earlier quoted context omitted.

I agree in theory, but in practice people don't go from renting houses to buying identical houses---they always trade up: from a 2 bedroom apartment to a 3 bedroom condominium, from a 3 bedroom house to a 5 bedroom McMansion, etc. Because of this the costs of ownership once mortgage, taxes, utilities and maintenance are tallied up are often more than what a person was previously spending on rent. Secondly, his major…

The conditions of Detroit actually make it one of the most attractive areas for Real Estate investment in the country. High & mid-rise buildings Downtown are being purchased (Dan Gilbert is one such buyer) for 6 figure sums. http://detnews.com/article/20110127/BIZ/101270352/Quicken-Lo...

Yeah, its a buyers market but if you already bought a home, you're a seller and likely hate the current situation in Detroit.

Re: Why You Should Never Buy a Home Again

#46

Post by swaits »

rbranson wrote: post #37

Housing is not an investment, it's an expense. To compare another investment, if you were to save $200/mo away into an investment account bearing 9.0% (like an S&P index fund), this would amount to $368,894 after 30 years. The whole time these funds are liquid and accessible to you, not subject to foreclosure, nor is this a required payment. $400/mo is $737,789.

9%? Yah, um, don't plan on that.

Re: Why You Should Never Buy a Home Again

#47

Post by ericb »

frankus wrote: post #16

The man's got a point. And I say that as a homeowner of nine years. The first point I would make is that unless you're independently wealthy, you're either going to be renting housing or renting money. All else equal, thirty years later you'll own some money or you'll own some property, respectively. The trick is in the "all else equal" part, because given rent versus price ratios, interest rates, and inflation expec…

Another good reasons to own is that when you own a home, no one can kick you out. When you rent, whether you live there next year is at the landlords discretion. A landlord may decide to sell next year, to renovate, to find tenants who never complain, to let their children live there, etc.

Also, fixed mortgages stay the same price, but rents rise.

Re: Why You Should Never Buy a Home Again

#48

Post by Psyonic »

jeffepp wrote: post #32
true_religion wrote: post #19

Earlier quoted context omitted.

I agree in theory, but in practice people don't go from renting houses to buying identical houses---they always trade up: from a 2 bedroom apartment to a 3 bedroom condominium, from a 3 bedroom house to a 5 bedroom McMansion, etc. Because of this the costs of ownership once mortgage, taxes, utilities and maintenance are tallied up are often more than what a person was previously spending on rent. Secondly, his major…

The conditions of Detroit actually make it one of the most attractive areas for Real Estate investment in the country. High & mid-rise buildings Downtown are being purchased (Dan Gilbert is one such buyer) for 6 figure sums. http://detnews.com/article/20110127/BIZ/101270352/Quicken-Lo...

If most real estate investors agreed on that, wouldn't the prices be higher?

Re: Why You Should Never Buy a Home Again

#49

Post by ErrantX »

rbranson wrote: post #37

Housing is not an investment, it's an expense. To compare another investment, if you were to save $200/mo away into an investment account bearing 9.0% (like an S&P index fund), this would amount to $368,894 after 30 years. The whole time these funds are liquid and accessible to you, not subject to foreclosure, nor is this a required payment. $400/mo is $737,789.

Great.

Except that money can't go into an investment account because you still need it for rent. Actually, around here I'd be paying about 50% more than my current mortgage to rent the same sort of house, so month-to-month it is a greater expense. So the only difference is you still have the down payment.

And even then, for me, having that downpayment makes little difference financially over the course of 25 years. I seriously doubt it would stay in the bank over that time.

I had an argument with a friend a couple of years ago along these lines; he claimed that renting was much more financially stable, but now he seems no more or less stable than myself... There is a lot of FUD around the "buy a house", "don't buy a house" argument, it's best to treat it all with a pinch of salt and make your own decision.

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