31–40 of 318 posts
The argument the author makes about the returns in stocks being higher than returns in real estate does not really hold when taking leverage into account. In my country, buying a home is the only way to get cheap debt for the vast majority of people.
Detailed analyses exist, e.g. https://www.youtube.com/watch?v=j4H9LL7A-nQ .
My mortgage is $1900 a month and I am extremely grateful for that, because it's been that for three years. I chose to buy so that I could have more predictability in my housing costs, and maybe someday I'll move, but then I'll rent it out. All that to say, if you can buying is infinitely better.
Thats like saying it makes sense to buy tesla stock because i bought it at $10
If this had been framed differently, it would be more interesting. Instead it comes across as universal (“most people won’t saved unless forced to”) and ignores the many many benefits of buying. (Not mentioning 5x leverage on a historically good asset is willful ignorance)
As a former renter of 20 years, these are great points that everyone should evaluate. As someone for whom home ownership made sense now, I wish I had been able to prioritize those factors earlier as it would have been nice to have my mortgage locked in at 2010 prices.
All I know is my mortgage is $1,800 a month and to rent my place now is at least $6K/month. I love knowing that my monthly payment can't go up.
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 have a friend who pays $300/month on a mortgage and rents the place out for $2000/month. At the same time, the house has nearly tripled in value over the past ~7 years.)
Of course, a solid investment plan may offset these - but only a domicile (doesn't need to be a house) would survive everything related to the economy going to utter hell.
I agree about houses, though. A saner plan may be to purchase a modest apartment or the like, that you keep in the wings until you reach retirement.
All I know is my mortgage is $1,800 a month and to rent my place now is at least $6K/month. I love knowing that my monthly payment can't go up.
Property taxes and insurance go up pretty much every year.
All I know is my mortgage is $1,800 a month and to rent my place now is at least $6K/month. I love knowing that my monthly payment can't go up.
Property taxes and insurance go up pretty much every year.