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My thoughts on renting versus buying

milesbarr.me

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Re: My thoughts on renting versus buying

#101

Post by novaRom »

firtoz wrote: post #20

It's interesting to paint the homeowner as an emotional person and the renter as the pragmatic, however both are roughly equally emotional. As the rent prices keep rising, the renter in the end will end up spending much more money in the same duration as a mortgage, won't they? After a few years, when they end up owning more of the property, they can secure a good deal with better monthly mortgage payments. They can…

How about the act of buying itself? Here where I live, you need to pay 12% on top of the home price simply for taxes and notary service. IMO it's one of the biggest obstacles and why most Swiss people prefer to rent.

Re: My thoughts on renting versus buying

#102

Post by zeroq »

wavemode wrote: post #92
zeroq wrote: post #79

Counterpoint: buying is always better, people just can't afford it. Here where I live the minimum price for rent is monthly mortgage installement, meaning that you'll pay for rent at least as much as you'd pay for mortgage. But after you pay your mortgage you still have an asset in your hand. You can pass it on to your children or you can sell it when you're old, downsize (or even rent) and get some cash for your ret…

> If you rent you're left with nothing. Well, no. You're left with the cash you would've spent buying a house. Whether that's financially better or worse, depends entirely on the mortgage interest, taxes, and maintenance costs of the house, as well as the money you could have earned investing the cash elsewhere, compared to the rent you would have spent over the same time period.

that's true only if you were homeless

Re: My thoughts on renting versus buying

#103

Post by bdangubic »

wavemode wrote: post #80
kibwen wrote: post #15

> The Flexibility of Renting Is Undervalued And the stability of buying is undervalued. It's telling that this article frames housing as an investment vehicle rather than as a basic necessity. And it's not just a necessity because it shelters you from the elements and gives you storage for your stuff; it anchors you in a neighborhood and allows you to begin forming a local community. The flexibility of renting that t…

I don't know many homeowners who formed "local communities" with their neighbors. I know a few, but not many. And I know renters who know all their neighbors well. Seems more like a personality trait than something enabled by owning where you live.

100% this - it is exception, small exception that communities can be formed with neighbours. take home-owners associations into the equation and there is higher likelyhood you’ll punch someone than have a beer with them

Re: My thoughts on renting versus buying

#104

Post by _chris_ »

kennywinker wrote: post #6

If renting doesn’t make sense economically, how is it profitable for the landlord? Because it’s almost always profitable for the landlord.

Longer time horizon -- mortage inflates away. In the short-term, only need to beat the property tax bill, especially if the interest rate is <3% and the property is increasing in value faster than that.

Re: My thoughts on renting versus buying

#106

Post by tomjakubowski »

al_borland wrote: post #91
A_D_E_P_T wrote: post #36

Earlier quoted context omitted.

Something I've noticed is that some cities are better for renters, and others are better for buyers. My current city in central Europe is very renter-friendly. A nice apartment would cost $600k, but rents practically never exceed $1500/month. Under such circumstances an apartment doesn't seem like a great investment. I've also lived, briefly, in Canada -- where rents were often extremely high relative to home prices.…

I saw this when I lived in the Chicagoland area. A co-worker was giving me the business for renting instead of buying something. The he let it slip that his property tax alone was $35k/year, almost 2x what I was paying in rent, and that didn’t even include the mortgage.

Surely this must not have been a like-for-like comparison, unless your landlord is very charitable or somehow secured a much lower property tax rate than your coworker did (as is possible in California through various Prop 13 mechanisms). Have you looked up what the property tax bill is on your apartment?

Re: My thoughts on renting versus buying

#107

Post by cramsession »

ghaff wrote: post #97
zeroq wrote: post #79

Counterpoint: buying is always better, people just can't afford it. Here where I live the minimum price for rent is monthly mortgage installement, meaning that you'll pay for rent at least as much as you'd pay for mortgage. But after you pay your mortgage you still have an asset in your hand. You can pass it on to your children or you can sell it when you're old, downsize (or even rent) and get some cash for your ret…

>Counterpoint: buying is always better, people just can't afford it. >Renting has it's charm for youngsters You're sort of contradicting yourself. So long as you think you're sort of settled in an area, buying is probably better. But, if it's your first job out of school, even if you have a nice bunch of money you could put towards a down payment, it's not clear that buying is a great idea except maybe if you're in a…

If you're young and you buy, you could get roommates and have them pay rent. That would definitely tilt the benefits heavily to buying.

Re: My thoughts on renting versus buying

#108

Post by bdangubic »

firecall wrote: post #82
kibwen wrote: post #15

> The Flexibility of Renting Is Undervalued And the stability of buying is undervalued. It's telling that this article frames housing as an investment vehicle rather than as a basic necessity. And it's not just a necessity because it shelters you from the elements and gives you storage for your stuff; it anchors you in a neighborhood and allows you to begin forming a local community. The flexibility of renting that t…

Absolutely agree with this! We need, as a society, to bring back generational communities. Our workplaces are not our families! I'll also add, that once you have children, owning your home is a very welcome level of stability. Nothing worse than looking for a new rental and potentially being forced to upend all your routines and find new schools for the kids as you cant rent in the same area anymore!

I know three families that owned and had to move cause they could not afford to live in the house they own (gerrimandering- related…)

owning does not shield you from shit like that, maybe in rural america but definitely not in/around the cities

Re: My thoughts on renting versus buying

#109

Post by estimator7292 »

wavemode wrote: post #92
zeroq wrote: post #79

Counterpoint: buying is always better, people just can't afford it. Here where I live the minimum price for rent is monthly mortgage installement, meaning that you'll pay for rent at least as much as you'd pay for mortgage. But after you pay your mortgage you still have an asset in your hand. You can pass it on to your children or you can sell it when you're old, downsize (or even rent) and get some cash for your ret…

> If you rent you're left with nothing. Well, no. You're left with the cash you would've spent buying a house. Whether that's financially better or worse, depends entirely on the mortgage interest, taxes, and maintenance costs of the house, as well as the money you could have earned investing the cash elsewhere, compared to the rent you would have spent over the same time period.

When renting a 1br costs as much as my mortgage on a 3br, I don't think that really tracks.

Re: My thoughts on renting versus buying

#110

Post by cramsession »

wavemode wrote: post #92
zeroq wrote: post #79

Counterpoint: buying is always better, people just can't afford it. Here where I live the minimum price for rent is monthly mortgage installement, meaning that you'll pay for rent at least as much as you'd pay for mortgage. But after you pay your mortgage you still have an asset in your hand. You can pass it on to your children or you can sell it when you're old, downsize (or even rent) and get some cash for your ret…

> If you rent you're left with nothing. Well, no. You're left with the cash you would've spent buying a house. Whether that's financially better or worse, depends entirely on the mortgage interest, taxes, and maintenance costs of the house, as well as the money you could have earned investing the cash elsewhere, compared to the rent you would have spent over the same time period.

Rents are pretty much always going to be higher than a mortgage for the equivalent housing. It's why people are landlords. He dances around that in the article by saying that people buy "nicer" places than they rent, but that doesn't have to be true.
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