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

The real cost of owning a home

ericturner.dev

Post reply on HN
Print view View original

151–160 of 901 posts

Re: The real cost of owning a home

#151

Post by tracerbulletx »

zeroonetwothree wrote: post #110
mholm wrote: post #6

Beyond the financials, the psychological impact of both being able to make greater-than-superficial changes, and having extremely predictable payments for years without worrying about substantial rent increases, is substantial. I redid/improved the bathroom to exactly what I wanted. I renovated the kitchen. I added paneling to the walls. I added a few outlets to rooms that needed more. I wouldn't do these things in a…

There’s also a psychological benefit of not having to worry about most problems. Sink broke? Call landlord to fix. Roof leaking? Call landlord to fix. And so on. You never have an unexpected $20k repair show up. And while I agree that it’s nice to customize things to your preferences, this has a downside in that it’s easy to get carried away and overspend. Might as well get the nicer finishes when you are remodeling,…

You can pretty much always finance a repair that size and amortize the expense so that it works out ok.

Re: The real cost of owning a home

#152

Post by throw0101c »

Ben Felix, a Canadian portfolio manager that does personal finance videos and podcast, has been arguing for years that rent versus buy is often a wash financially, and that you should make the decision for non-financial resasons.

* recent 2026 video: https://www.youtube.com/watch?v=aU7v87EhDBI

* 2025a: https://www.youtube.com/watch?v=j4H9LL7A-nQ

* 2025b: https://www.youtube.com/watch?v=lBG-g1CKfgs

* 2021: https://www.youtube.com/watch?v=q9Golcxjpi8

* 2019: https://www.youtube.com/watch?v=Uwl3-jBNEd4

The 2019 video goes over a handy "5% rule of thumb": start with the purchase price of home, take 5% of that: if your rent is less than that, better numbers-wise to continue renting (and investing the difference); if your rent is more, probably better numbers-wise to buy/own.

The company he works for created a tool to examine the numbers:

* https://research-tools.pwlcapital.com/research/rent-vs-buy

Re: The real cost of owning a home

#153

Post by jrflo »

A lot of discussion of the cons without discussion of the pros. For example: 1) your home is a hedge against inflation, your $2000 to interest sounds terrible when rent is $2500, but doesn't sound so bad if rent rises to $3500. If you live in your home for long enough, this is all but guaranteed. 2) your home is a leveraged investment. You may only be getting 4% per year in appreciation, but that's 4% gains on the total value of your home, not just your equity. If you have a 500,000 home that appreciates by 4%, that's 20,000 that you get directly, not the bank.

Interest rates sure have made it less of a good deal than it was ~5-10 years ago, but it's usually still worth it in the long run.

Re: The real cost of owning a home

#154

Post by masterj »

bell-cot wrote: post #2

> You can save a lot of money in maintenance and repairs by doing your own work whenever possible. True. But even if you have the physical ability, skills, tools, and equipment handy - you can spend a lot of time on maintenance & repairs. Just ask anyone who's done yard work for a few years, or has repainted a house, or ...

I learned very fast after purchasing my home that hiring out to a contractor made so much more sense. They can get done in a day what would take me a month+ of weekends.

Re: The real cost of owning a home

#155

Post by the_sleaze_ »

sanp wrote: post #126

Is the author accounting for the equity built up? Cash has to go out whether it’s a mortgage or rent. With a mortgage you are building equity. This changes the true math when you sell (leaving aside your ability to now get a HELOC).

He's saying - and rightly so - that outflow towards rent can be significantly less than outflow towards real property equity given the structure of a traditional mortgage + maintenance burden. And with (a large amount of) financial discipline that delta can result in substantial increase in wealth at the end of the day.

Re: The real cost of owning a home

#156

Post by adammarples »

sanp wrote: post #126

Is the author accounting for the equity built up? Cash has to go out whether it’s a mortgage or rent. With a mortgage you are building equity. This changes the true math when you sell (leaving aside your ability to now get a HELOC).

Yes the author is accounting for the equity buildup. They only count the interest part of the mortgage repayments as an expense. Any principal repayments are neutral.

Re: The real cost of owning a home

#157

Post by bachmeier »

Famous article by JL Collins: https://jlcollinsnh.com/2013/05/29/why-your-house-is-a-terri...

Another thing to keep in mind is the lumpy nature of costs, meaning you need to have access to cash to pay for multiple major maintenance projects in one year. My largest single-year expenditure for maintenance was 25k in a LCOL area pre-pandemic. That would probably translate to 50k today. If you have to dump that on a credit card, good luck digging yourself out of that hole.

It's common to hear that renting means you might need to move at the end of any 12-month period. Well, that cuts both ways. You have the option to move away at the end of any 12-month period too. Lots of folks had to turn down job offers in the aftermath of the housing crisis because of their homes.

Re: The real cost of owning a home

#158

Post by Marsymars »

bgirard wrote: post #21
someuser54541 wrote: post #3

Aren't quite a few of these concerns alleviated by owning a condo?

Which ones? Mortgage, real estate costs, repairs, maintenance are all still there with a condo. My gut feeling is that repairs and maintenance cost more with condos than if you own a home and you're handy to fix minor stuff and know how to find good contractors for bigger jobs. I imagine condo jobs becomes more difficult and contractors charge more for those jobs. But I don't have data to back my hunch. Condo has ext…

"Finding good contractors" can be pretty challenging, especially finding good contractors at a good price.

Condos can also benefit from efficiencies of scale - e.g. there are plenty of small jobs on myself that I do myself, but between the time spent on research, and expenses/trips to pick up supplies and tools, I'm spending multiple hours of my time/money on things that someone experienced/equipped could bang out in 20 minutes - but any decent handyman is going to charge their call out rate of $100 + materials for a 20 minute job. vs at appropriate scale a condo corp can effectively just have/share a full-time handyman and save a pile of overhead.

Re: The real cost of owning a home

#159

Post by cucumber3732842 »

ramesh31 wrote: post #29

Having your own home and property where no one on earth can tell you how to live: priceless. Maybe home ownership is becoming a luxury, but humans don't exist in financial spreadsheets. The intagibles of SFH ownership are worth literally everything to me after a lifetime of renting. It's also absolutely a class differentiator in the US. If you're behind on your rent and getting evicted, that's seen as a personal mora…

>Having your own home and property where no one on earth can tell you how to live: priceless.

Whatever you do don't read your local zoning code.

If you really want motivation to browse large bulldozers on Facebook Marketplace look into the legal doctrines that underpin these codes. It's pretty mind boggling.

Post reply on HN