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

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

#231

Post by EGreg »

Here is my thinking:

I want to rent, not own. And that includes a home, at least until I have a family.

Why? Besides the optionality of moving, or not worrying about flooding etc. Lots of things are not necessary to be exclusively owned by you, anyway, like a car that you park every day to collectively take up tons of space on city roads.

It’s because every time you buy something you invest in it. That’s money you could have invested elsewhere (opportunity cost).

Say you had $100K in 2011. You could either:

A) Make a down payment on a house, live in it, and keep buildng equity in it

B) Do that, but rent out the house to another person and use the money to rent anywhere else

C) Rent the house you live in and invest in Bitcoin instead

Guess which strategy would have had you far far ahead.

C is better than B which is better than A.

And that’s why I prefer to rent. Decouple orthogonal things: using and investing.

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

#232

Post by avgDev »

madengr wrote: post #209
abalos wrote: post #204

Earlier quoted context omitted.

This is similar to a realization I had the other day: for many people collecting things is less about the objects and more about the memories and nostalgia and associated with those objects. I have been having a lot of "identity" problems lately, and it occurred to me that very little of what I own has any substantial story about it nor does it say much about who I am as a person. The objects we collect exist as affi…

I hate seeing all this garbage from Ikea when there are plenty sturdy “antiques” made from hard woods, as opposed to sawdust, glue, and cam locks. I have a some furniture hand made from my great-grandfather, grandfather, and father. I made a nice pair of speakers. This stuff will go to my kids. Much rather buy from the Amish furniture store and pay more, than the disposable shit from Ikea.

I buy IKEA furniture. I bought Ikea kitchen. 20 year warranty and I know they will be around for it. Hardware is the best you will get for the money on those cabinets.

Some IKEA furniture is actually decent. I don't want antiques in my house because I remodeled to have a modern look.

My dad bought kitchen cabinets from a small retailer, they gave him shit when he tried to replace one door because it was warped.

Honestly, I would rather deal with a major chain/retailer. I bought stuff at IKEA that wasn't wood but lasted over 10 years and served its purpose, and when it comes time to remodel I can buy something new and still end up paying less than for some "wood" furniture.

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

#233

Post by drivingmenuts »

pluma wrote: post #113
drivingmenuts wrote: post #36

This doesn’t sound like the worst idea ever. If you lose your income, just say “come and get it” and you’ve significantly lowered the cost of moving/finding storage, etc. while you search for a new job. I kinda wish I’d thought of this before a couple of bad years of the Universe deciding it didn’t much like me much. I’m sort of back on my feet (employed) but I don’t own much more than some minimal furniture, clothes…

Sure, I mean if you're unemployed, what's the use for furniture or a bed? And it's inconceivable that you might remain unemployed for any extended duration or not have savings (or sufficiently affluent relatives) to fall back on. Pardon the sarcasm but I sincerely doubt you know what you're talking about if your biggest worry was moving/storing/selling your furniture.

My biggest worry was trying to find a job followed by what do I do with all this stuff when I got evicted. By that point, I didn’t have savings left and no family to fall back on. I slept on an air mattress for the best part of a year in a borrowed room of a very kind (mostly) stranger.

I got through it, but I do not want to ever be in a position again where I have to watch my stuff get given away because it’s old crappy stuff that can’t be sold for food money.

By renting, I can have a few nice things and when I can’t, we’ll, too bad, but I need that money for something else, like food or medecine.

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

#234

Post by Spooky23 »

chrisco255 wrote: post #26

Renting an apartment vs owning a house is not necessarily a bad financial move. Depends on a number of factors. For instance, if you anticipate moving within a certain time frame, between closing costs, mortgage fees, commission, etc...it can cost more to own in the first 3-5 years, especially if prices are stagnant. Also, there are hidden costs of home ownership not necessarily factored in for, like repairs, mainten…

Only in very specific, unusual market conditions. Less than 3 years it makes sense to rent, but even then it’s difficult to time it so you align with the lease end.

I live in a national average housing market, bought a house in 2006, and save about 30% on a monthly basis as compared to a much smaller two-bedroom apartment. I include mortgage, tax, insurance and a 7% holdback for repairs.

Long term, renting is always losing proposition given the low cost of capital.

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

#235

Post by 0x445442 »

Barrin92 wrote: post #48
chrisco255 wrote: post #26

Renting an apartment vs owning a house is not necessarily a bad financial move. Depends on a number of factors. For instance, if you anticipate moving within a certain time frame, between closing costs, mortgage fees, commission, etc...it can cost more to own in the first 3-5 years, especially if prices are stagnant. Also, there are hidden costs of home ownership not necessarily factored in for, like repairs, mainten…

Renting anything really isn't a bad move. There's not much upside to owning something that depreciates in value. Instead of buying a sofa for 2000$ renting one for 50 and putting the rest of your money into some productive financial asset is actually perfectly reasonable.

Using your example, renting the sofa only makes sense if you expect to only need a sofa for about 40 months. I say about because if you're super diligent, and most aren't, and put the extra 1500 in some investment you're still only going to stretch out the break even point to something like four years. Most people have sofa's more than four years.

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

#236

Post by Spooky23 »

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.

In most places they walked away with nothing.

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

#237

Post by ZeroFries »

I personally like buying used, keeping it in good shape or even improving on the bought condition, and re-selling when I no longer need it/am moving.

My aunt's mother-in-law just moved back to England from Canada. She spent thousands to ship back junk. She could have sold or donated most of it and used the money to buy all new stuff back home and been way better off for it.

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

#238

Post by avgDev »

TeMPOraL wrote: post #109
Barrin92 wrote: post #107

Earlier quoted context omitted.

The point of the exercise is to invest the money you didn't pay into something that earns you money. If you put the 1950 bucks you didn't spend into stock, you're making money. And in case of damages and repairs, if you own the sofa, you're always sitting on the damages. Homeowners for example routinely spend thousands of dollars per year on their houses, whereas renters (generally), have repairs covered by the landl…

As a regular middle-class person, how do you put $1950 in stock to make more than $400 in 5 years risk-free and time/effort-free?

I was under the impression that putting money in stock market is basically gambling and you should be ready to lose that money.

Putting money in a property especially if you can do your own upgrades can really pay off. Example, bought a house for $280k,I invested about $50k, its worth about $400k now.

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

#239

Post by ZeroFries »

dingaling wrote: post #101
chrisco255 wrote: post #26

Renting an apartment vs owning a house is not necessarily a bad financial move. Depends on a number of factors. For instance, if you anticipate moving within a certain time frame, between closing costs, mortgage fees, commission, etc...it can cost more to own in the first 3-5 years, especially if prices are stagnant. Also, there are hidden costs of home ownership not necessarily factored in for, like repairs, mainten…

> Finally, one can use the savings from paying rent What savings? Rent as you stated already includes anticipated maintenance costs, property taxes, the landlord's mortgage costs, often an agency fee, plus a margin for the landlord. I don't think I've seen rental rates ever cheaper than a personal mortgage. The main advantage of renting is avoiding long-term commitment but you'll pay a premium for that flexibility. O…

In the GTA (Toronto area) it costs around $2500 for a SFH, or $1M+ to buy. Around Ottawa, a house rents for similar prices, perhaps a couple hundred less, but the same house can be bought for half the price. It absolutely makes sense to rent in the GTA but less so around Ottawa. Landlords in the GTA are banking on ever escalating real estate prices to make a profit when they finally sell. Rent doesn't always scale with land-value.

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

#240

Post by 52-6F-62 »

dawhizkid wrote: post #38
mehrdadn wrote: post #27

Earlier quoted context omitted.

Sorry but do you find this ends up being wasteful at all? I don't know how many of/how much these items can be reused, but it feels like it would promote far faster consumption than ownership.

How did you come to that conclusion? The effect is the complete opposite...instead of a lot of people that move frequently (i.e. younger people) and buy/toss a lot of cheap Ikea furniture every year, you rent high end, long-lasting furniture that is delivered/removed for reuse.

People just toss that stuff?

I must be a sucker, because I've been carrying some of it around for close to a decade...

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