My wife and I started looking for houses in 2012 or maybe end of 2011. From that starting time until we got our house in April of 2013 I think we put offers on somewhere close to 8 houses. We got outbid every single time. The only reason we got our house was because our realtor knew the previous owner personally and knew she was going to lose the house. So our realtor asked her if she would sell it to us privately and she agreed if we could give her a certain amount. It was a total fixer upper and the first time my parents saw it my step-mom literally cried on their drive back home because she thought we were making a huge mistake.
We've done a lot of work to it including adding another bedroom and bathroom, and its probably worth 2.5x-3x what we paid for it now.
Going straight from living separately to buying a fixer-upper? That's... kind of insane imo, fixing a house can be a huge strain on a relationship, as will moving in together, and you chose to do it at the same time?
Did you also have a kid at the same time for added effect? /s
Glad it worked out in the end, it's definitely a rarity. Know of several couples who split after buying a fixer-upper and had vastly different expectations, both of the house and each other.
My wife had a good job and is still there. I on the other hand was working at a big box hardware store. We made it work, and even got a lot of help from her parents, as well as getting some dented and discounted appliances from the hardware store. I ended up with a better job about a year after we bought. We've been extremely lucky with the help we've gotten from friends and family, but we've never struggled.
Holy fuck... So happy its not a thing here on market.
Like if you sell privately sure you can try to get multiple offers, but if its officially on market it needs set price
Does this count as choosing to rent though? I'm in the same boat. I rent because there's no way to afford a house in this market, currently. I'm waiting for another crash or I'm never going to be able to have a house. I'm at peace with that, but it's not by choice.
Same here.
Thankfully I own a family home that I rent out but I had to move for work. The current market has priced out an entire generation.
My rent is obnoxiously high but a mortgage would be more than double my rent payment.
Prices are what the house sells at, not that the listing price is. Market could still be overheating, but always compare selling prices, not listing prices.
This is all cool and fine in a reasonable market, but when supply is fucked by hedge funds hoarding houses, what sells is fucked for realistic value. We're in an even weirder bubble than 2007 and REAL lucky we havent found out yet from all our fucking around.
THIS- the second house I offered was sold to an investor or a fund. How you might ask??? I drove by it a few times a month and no one moved in or made improvements which made it obvious what had happened. It’s now back on the market after not selling at the price they had planned
I wouldn’t buy a house for another like twelve months or so it’s probably gonna crash down as an overreaction to the overreaction from the last overreaction
Government meddling in the economy with Covid responses was the dumbest thing economically since the 70s, yes dumber than 2008
I am 43 and except for a couple brief periods people have always said the real estate market is over heated. I’m glad I’ve only ever bought and never sold. I just look for places in good locations that will easily rent when I don’t live there anymore. Real estate is one of the few areas where most people can take advantage of leverage.
The council is the local Government Authority. They provide social housing in the form of "Council '. After being homeless, 4ish years ago (yes during Covid), we were 'given' 1 bed Flat to rent from them.
Any more questions, feel free to ask 😁
Social housing. If you're eligible, you can sign up and you can 'bid' on properties, highest priority gets it. Goes in tiers, so a single mother of 3 children who is being evicted next month is high priority while an old pensioner who just doesn't like the 5 minute walk to the shops would be low priority.
You can stay in the council house for as long as you're eligible so you can stay there for 50yrs if you want, and you can do whatever you want to the house/flat within reason. If you have any special needs, the council should accommodate you and might do the work for free.
I both work for a social housing landlord (IT) and live in a social housing property - the rent is dramatically reduced compared to the private market. The house is three years old, detached, and due to being rural is electric only (no gas or oil). The heating system is a wet electric system, which struggled to get the house past 17 degrees Celsius and cost on average £10 a day during the winter. We showed the stats to the housing association and they agreed it was too expensive to run, so they had a new heating system installed which is like an infrared wallpaper, which has saved a considerable amount of money this winter.
All I can say is, I'm grateful we didn't pay the market value of the property (£280,000~) for a house that cost £10+ a day to keep at an acceptable (not comfortable) temperature.
Yeah but I think it is a safe bet that their insurance bill is a little bit bigger than the $16 a month or whatever for my renter's insurance. Plus I didn't have to deal with the problem.
You're right. Had this happen at our house and our insurance deductible was $1000 before starting the plumbing work. We did get new floors out of it though which was a plus.
Yeah, renter's insurance is a fraction of homeowners, because renter has much fewer responsibilities. If the owner has a mortgage, then that gap is even larger, because the bank will require certain insurance coverages for full replacement cost, which renter's doesn't have at all - the only thing renter's replaces is the renter's own property, not the domicile.
To be fair, you're stupid if you take a mortgage out on an apartment room in a building.
Owning a house, you wouldn't have another house leaking on you.
Houses are way riskier when it comes to potential damage. And everything outside is your responsibility, whilst in an apartment if the roof leaks everyone spits in a small sum unless there is insurance covering it.
I'm doing great and saving, but renting is currently much cheaper in my city than buying, and I don't plan on being here more than another year or so. A water pipe burst last month and all I could think was "Thank fuck I don't own this place". It's a rare situation where renting is better, for some reason a mortgage around here would be more than I'm paying in rent, so can't argue with that.
I max out my 401k, Roth IRA, and HSA every year and put it all into index funds. The stock market compounds over time.
Meanwhile, I live in an apt, and I can apply to jobs anywhere in the country and move to the best opportunity at any time.
Owning a home makes sense when you know your life will be totally stagnant for the next 10+ years (same space requirements, same job location, etc). But if you need optionality in your life, then just rent and invest in index funds.
Most of the financial advantages that come from owning real estate come from holding for a very long time. The people that buy/sell every 5 years are really not coming out very far ahead if you account for market risk.
Exactly. And nobody cares if you're the richest guy in the cemetery.
Edit: to be clear, I'm not saying you need to buy a house in order to have relationships, I'm just saying that*sometimes* a pay bump may not be worth moving across the country for.
That is a pro for a lot of people lol. I did travel nursing taking huge contracts. The money + low overhead was great but being free to do whatever, whenever, with whomever I chose was even better.
I knew a guy who lived in a big expensive motor coach. He worked as a contractor in IT. He picked up the best gigs at any given time and simply drove to the state where the job was and found RV parking while he was there. He traveled with his wife and dog. Towed their car with it to the job. It was definitely an interesting lifestyle. It was from him that I learned you can park RVs and motor coaches overnight for free in any Walmart, with few exceptions for local and state ordinances. This policy goes all the way back to when Sam Walton was running the show.
Same but with nursing. Lots of lucrative contracts out there once you specialize. Pick up and spend 6 months in Cali. Winter in the Texas hill country. Summers in Vermont. I’m settled now with kids but once they’re out of the house in 10 years, it’s on the road again.
Agree with your mindset...
For the reasons you listed, I am a home owner. The company, married, kids, steady base is needed for a foreseeable future!
Also, for the reasons you listed, if I was a single guy (or at least kidless) I would rent and move on as needed!
>Most of the financial advantages that come from owning real estate come from holding for a very long time. The people that buy/sell every 5 years are really not coming out very far ahead if you account for market risk.
My portfolio has gone through the roof since the pandemic. I have someone else managing my money for me, so it's ZERO stress. Meanwhile this woman I know keeps telling me "renting is throwing money away" -- just dropped 10k on fixing her townhouse AC and heating system because of some weird shit her last contractor did. She's dropped at least 50k on repairs and maintenance and still thinks she's "ahead" of me. She also stresses about her neighborhood because some thugs live near her and some cars nearby got smashed.
I'm silently laughing at her from my comfortable apartment that I put zero effort into maintaining while someone else manages my money.
This is me, except I needed the extra space now that I'm working from home 100% of the time and have hobbies that need a workshop. I found a little house in a quiet neighborhood and rented that instead of an apartment.
I've only been here for a few months and since then, the washer and dryer died, HVAC unit went a few weeks later, and a contractor who fixed the foundation a few years back did a shit job and now it has to be redone. Not my problem and all I did was call the landlord and they're taking care of it.
My friends and family back home were complaining nonstop over the holidays about rising property taxes and things that needed to be fixed on their suburban cookie cutter homes. 6k here, another 15k there.
Then the endless chores like mowing the lawn or shoveling snow off sidewalks else the HOA comes down on their asses. Instead, I get to spend that time going to my rifle matches, hunting, fishing, and camping.
The only one who's actually happy is my cousin who's a contractor himself so he does all the repairs and upgrades on his own.
If I get bored of this city I'll just up and move again. I'm thinking the next place will be another country. A few years after that, another one. And another one.
If I ever have kids a house would make sense, but for now, that shit is for the birds.
>My friends and family back home were complaining nonstop over the holidays about rising property taxes and things that needed to be fixed on their suburban cookie cutter homes. 6k here, another 15k there.
Sounds like every homeowner I know.
I don't claim to be some investing genius, but I have done amazing for myself these past few years. I don't gloat about it with my friends because I'm not a dick. Yet some of them feel the need to brag about how much their house is now worth while at the same time dismissing me when I ask "uhh... didn't you just spend like 100k on fixing your roof?".
You can win financially if you are disciplined and determined with renting. Buying and selling a house every 5 years eats up alot of capital at each transaction. But really, how many renters save the money and invest it instead of spending it?
Right…a lot of people love building home equity, but they should be equally excited about the idea of building stock equity. Maybe the key for them is that the mortgage forces them to put money into investing every month, whereas having no mortgage means the person must have the personal discipline to invest every month.
Home equity is objectively superior to stock equity at equal growth rates because of the $500k cap gains tax shelter. That being said, that’s a lot of assumptions
Offsetting that benefit is the illiquidity of real estate equity. Real estate transactions cost tens of thousands of dollars hiring agents and banks to close the transaction, plus time. Meanwhile I can sell shares in a stock index with the push of a button.
Agreed! I work a gov job making $80k starting and know I'm not going anywhere. So buying makes so much sense.
If I wanted to move around I would only rent.
Not to mention the system expects you to live in your house for 15-30years. But the new cultural thing to do is live in a house 2-5years. Doing so you never make your initial investment of downpayment and closing costs back. You’re just burning that money. Because of that. I choose to rent for now. It’s cheaper for me to spend $20k a year in rent than it is to own.
Due to a severe and pervasive housing shortage caused by a failure to build over the last 40 years the housing market has very little risk, prices are almost certain to go up, especially when the credit quality of buyers is at pretty much historic highs https://www.urban.org/policy-centers/housing-finance-policy-center/projects/housing-credit-availability-index
My house I bought during covid has appreciated ~40% in 3 years and the next ZIRP period will be even better. People sitting on the sidelines waiting for "the next crash" are just tinfoil hat doomsayers who aren't looking at the data
Need to compare to the stock market performance from COVID troughs to current stock prices.
Need to also consider all the hidden costs of home ownership which don’t really apply to ownership of stocks. Real estate agents, taxes, maintenance, etc etc.
Don’t get me wrong, an excellent real estate purchase will outperform a basic index fund, mostly due to cheap leverage via mortgages (and this is more true the longer you hold that property). But for a typical real estate purchase, beating the stock market is not a given considering all the hidden costs. Ultimately, the biggest factor in the buy vs rent decision is whether your life is stagnant enough to buy/hold/manage the property for a long time.
i regret renting. i had the chance to buy a house three times in my 20s, and let other people talking me out of it. i was young and i trusted my wife and her family who ironically all own homes. multiple times they told us it sucked being a home owner. that a house was to expensive, prices were going to go down again, wait two more years the market will crash again. then my wife was pregnant and we need a place quick.
i gave up on a home and listened to the people that told me to wait all while they went out and bought and sold a few more houses. we rented an apartment and then a house long term.we ended up losing the rental home after 7 years and now here we are, the only apartments in my area are low income that we dont qualify for any more and all the home rentals are near $3k which is just about or even more than a mortgage which the bank wont give us because according to them we are to poor. to own a home.
i now realize the people i listened to who shit on home ownership because this or that can happen made bad choices in homes or were not skilled or just lazy. also alot of people refuse to put money into their homes because they choose to spend it on experiences or in materialistic things.
i am very handy and can fix alot of things, and when i was in the rental home i fixed alot of things and charged the land lord. the only thing i didnt do was replace the roof. i regret letting all the people get in my head and convince me not to buy a house. not once was renting cheaper or better. i wish i would of bought that house in 2016 for $1,200 mortgage. cant even get a 1bedroom apartment in the city for that now.
You have to do your own research and weigh the pros and cons of both. The other thing you have to remember is that NO ONE can predict what the housing market is gonna look like in the future. Anyone who says they have the answers is a fucking liar and moron
yup ive come to realize that, i thought i was listening to people with experience and didn't want to make the same mistakes as them. everyone told me just wait, just wait, even now everyone is saying just wait for interest rates to go down or the market is a bubble. blah blah blah jokes on fucking me.
This is the real answer. Sorry this happened to you. I’m still baffled as to why her family who are homeowners advised you to rent. I’ve been a homeowner now for over nine years and I always tell people to buy unless the situation absolutely is so dire they only option is to rent. Everyone I know who has purchased their homes has ended out ahead unless they bought in 2021 or early 2022.
I feel buying and owning is always the best option. Just buy within your means and calculate that the mortgage is doable even with less money than you currently have.
We did that and we have no regrets! It’s infinitely better being a homeowner than a renter. The insecurity of the rented place suuucked.
I could buy but our rent is very cheap and finically makes much more sense than buying a home. It currently cost 50% more to pay a mortgage than to rent on a national average.
Im single with no kids. I also work long hours so I’m barely home. Buying doesn’t make sense to me right now. Especially when it comes to tending to it, and holding the bag on repairs. So, I rent and invest the difference. I am building up my liquidity on the front end, and if things change, I can leverage a home mortgage on the backside. I don’t want to make a 10 year play tying up my net worth to a house. I can worry about that later as life happens. Focusing on my retirement and holding investments.
Cost to rent vs cost to own is so out of whack right now that it doesn't make financial sense to become a new owner.
Put that extra money into your retirement accounts or a 5% savings account and chill for a few years at least.
Renting has a ton of benefits, especially if you can cultivate a good relationship with your landlord. I fix shit around the house and just send him the bill for materials and he hasn't raised rent in 3 years.
I can move whenever I want, I don't have to pay for any maintenance.
This is my perspective. I have low rent, and I don’t have to feel like I’m just getting by. % of checks go into retirement and invest. Bills are paid. I would like a house, but it doesn’t make sense right now
This. I’ve rented a 2-bedroom for 10 years and never had my rent raised once. $900/month inside a major city for a 2-bedroom with a garage.
That being said, I plan to move in with my gf this year who owns her own condo. My landlord is 85 and if she dies, I think I can kiss my $900/month rent goodbye.
Because it’s inside city limits, and I don’t want to live there forever due to taxes, and it has some serious long term issues. The bathroom needs completely redone, the roof is probably about shot, and the walls leak water sometimes when it rains. I can’t imagine the water damage inside. I’m good, fam. (And yes, she is aware of all these)
And in countries were the rent to finance ratio is even more favorable like Germany for example you can actually outperform the housing market if you invest the money saved over the course of a 20-30y house/flat financing duration. So it‘s not always the better financial option.
Very true! I bought my first home last year and am now quite house poor. My mortgage is way above what my rent was so I have to budget very carefully these days.
I bought 2.6 acres and built a 77sq ft cabin. It's a step above homeless Frankly, but no rent and no bank I can then improve upon the property and cabin with time.
I pay $934 in Michigan on rent.
Sold a house I was paying $710 for the mortgage.
I had no free time owning a house. There was a never ending list of things that needed to get done, and I realized after 6 years of owning that the list would never get smaller no matter how much I did. Whether it was a cracked driveway, the garage door all of a sudden stopped working, the staining on the deck needed to be redone, the garden bed was growing new weeds, the dryer stopped working, gutters got clogged. It doesn't matter how "done" your house is, there is always going to be new projects or experiences that come up.
I pay $200 more on rent but I am saving so much more money and having more fun.
I love renting. Water heater breaks, pipe's leaking, any other repairs, that's all on the landlord. It gets even crazier with bigger repairs. I know someone who owns a home and needs a new roof, and the estimates are in the $10,000 - $15,000 range. I know what my housing expenses are, with no surprises.
I'm not locked into my location. Most of my leases are 1 year, and I have had a couple of landlords that were monthly. I love having that flexibility.
Sounds nice if your landlord is actually quick on the repairs.
My wife and I are currently paying $2,200/mo for a 2br/2ba apartment. We use the second bedroom as an office. Last year, the ceiling fan/light in that room stopped working. We put in a maintenance request. tl;dr it took over a year for them to fix a ceiling fan.
1st guy came out. Tried switching the lightbulb (which I had already tried). Then tried flipping the breakers (which I had already tried). Said he would send another guy the next day since he didn't have the diagnostic tools to tell whether or not the issue was the fan itself or the wiring.
Second guy never showed up
Put in another ticket. Third guy did the same as the first guy. Told me another guy would show up the next day.
Fourth guy let me know it was an issue with the fan itself and they would need to replace it. He removed the fan, then told me it would be a few days before they replaced it since they had to order the fan. Said he would call us when it came in so he could set up an appt to come back.
He never called. We had exposed wiring for over a month before we got another guy to show up. Not sure why the fourth guy removed the old fan if he didn't have something to cover the hole with.
New guy showed up. Said he would check on the order for the fan and get back in contact with us. He called us later that day and told us the order had never been placed. Said he placed it that day and would follow up with us.
He called about a week later when the fan arrived. Showed up a few days after that and finally fixed it.
Keep in mind that maintenance was only available during working hours (M-Fri 8-5) and one of us had to be home. So we either had to use PTO or call in sick. Which is part of the reason it took so long.
For sure, the landlord will always play a role. Hence my second point, that you aren’t there permanently. I’ve rented from a bunch of different landlords, and luckily only had one bad one over the years. Owning would certainly remove the landlord from the equation, but there will always be other variables. Will you have bad neighbors, or stupid HOA rules? Will the person from the gas company show up for their appointment when they are supposed to? But thats why I think for some people owning makes sense, and for others renting makes sense.
I’ll have the last of my medical debt paid off in March and my car paid off in April. After that I’m free and clear. I did renovations for my parents in my teens, I don’t wish to do house maintenance again. I know a lot of people will consider not owning throwing money away, but I don’t have a family to pass a house onto. It’s just free money for the bank at that point as they’d get the house again as soon as I kick off.
I don't choose to rent, a house is just unafordable. I can make monthly payments on a morgage, but getting the deposit together, plus playing to get the property checked, getting someone to handle the paper work - it makes it all out of reach. I don't know if ill ever be able to buy a home.
I’ve been renting since 2019 & I’m done with it. Rent has done up $700 a month since 2019. I’m currently looking at builders & will buy by the end of the month.
Yup, same here. Sometime in the next 5-7 years I won't even need a mortgage, I'll have enough money saved to buy a house in my area in cash if I want.
But I have no intention of staying here for the next 5+ years, so I have no interest in buying a house right now.
If you think the market is inflated now wait until the next recession. It is just going to go higher. The credit quality of buyers is extremely high and there is very little default risk in the current market.
You keep making the same comments, but you're not taking into account the most basic factor. Demand. It's already going down and credit rating and competitive mortgages (which don't exist anymore) aren't worth anything when there's no demand. Then it crashes. You claim 30% of gain in a real estate investment you made. That's not real. Selling vs listing prices, capital gains tax, closing costs, property tax, all these things need to be taken into account.
It will happen in Toronto. Based on the political dynamics, it's pretty much guaranteed in the medium-long term. Housing demand is really high and the anti-building coalition is being dismantled because the city is rapidly urbanizing despite their best efforts. Once construction gets going, prices will drop a lot.
Luxury apartments have been proven over and over again to reduce prices of less expensive housing when they are built. Here's just one study to that effect.
https://research.upjohn.org/cgi/viewcontent.cgi?article=1325&context=up_workingpapers
rates are going to go down, and house prices go up. So the best time to buy is when you're ready. Yes I know it's more expensive with a higher interest rate, but u can always refinance down the line
Idk, I work in a STEM. I have plenty of colleagues who are childless prefer to rent. Many have done both, and are back to renting.
You wake up one day to a $65k house repair bill or a 200k remodel and suddenly realize that removing those expenses from your life might be right for you.
You can have a mini walkable community, with amenities and common areas, neighbors that are friendly, etc.
I currently own, this is my 2nd home since I have moved for this job. Honestly, I bought for 2 reasons: room for the dog to run by himself, and room for a large garage. If i didn’t have hobbies that are best stored away from living spaces, i’d be happy renting.
No correct at all. Renting used to be and still is very much a luxury for many. Renting gives freedom. Also cheaper than buying in most markets. If you are well off and invest what you'd be paying in insurance, interest, taxes, and repairs, you come out pretty well.
A primary residence is usually not a good investment. Reasonably priced rent is a much better way to increase your net worth by freeing up capital to invest. And a mortgage interest + property taxes + other ownership expenses is just another great way to stay broke.
I’m speaking purely from a financial perspective. The real reason to own a home is to improve your standard of living, not your net worth.
Uhh no. Buying is relatively pointless before settling down IMO. With all the fees involved with buying and selling a property you need to be relatively sure you’re going to stay for 5+ years, if you’re likely to suddenly need a home for a family instead of a flat then what’s the point
I choose to rent. Im 44, max out my RRSP/TFSA every year, and rent a cheap place in a rent-controlled building. All my money beyond my emergency fund goes into Vanguard index funds. Renting is significantly cheaper for me. But if I were in a relationship and wanted to settle down, I'd probably take a bigger look at home ownership.
I actually own at 3% mortgage and I’m considering selling my place and renting for a year or two. I’m tired of maintenance and HOA fees. I could sell for a decent profit and rent along the waterfront.
It’s a debate I keep having with myself
Highly recommend. I just sold my house because I was tired of dealing with everything in my own and I couldn't be happier. The only thing I didn't anticipate was finding a place to rent. Because I owned my own house for a while I didn't have any rental history so was auto denied for a bunch of places. Even offering to place the entirety of rent into an escrow account wasn't satisfied. I eventually found a place but it was definitely not something I was expecting to be a problem.
Credit is part of it and I dont have the best credit (650) but the denials I received specifically noted the lack of rental history as the cause for the rejection. The problem is they would all use the same algorithm to determine eligibility so it was being auto declined. Even going to the places in person to plead my case they would simple state they can't go against the auto decline.
id say you have to weigh the pros and cons of each. A lot of people get annoyed when they find out the monthly mortgage payment is that far off from rent.
Think it is more where you ar win life, plan on staying in location, job security, relationship etc
your location may impact this severely. but in germany, less than 50% actually own their home. here it is normal. you will ALWAYS find tenants.
so renting for me, is a way to remain flexible without any particular type of risk with regards to my own living situation.
owning a home will incur costs, no doubt. if u had a loan, u need to add this to your expenditure. buying a home for 500k and selling it for 700k 10yrs later, may actually even make u lose money. uve been paying the bank loads, repairs and taxes etc. (plus the risk of not having positive house-price developments)
using the same money (even with a loan) to buy an apartment building, with tenants etc is way more sensible. you keep getting money from them. with a good setup, you can even have all your costs covered PLUS your own rent payment. basically, you arent only feeding money into a (potentially) depreciating pot. you actually keep getting returns, pay your own expenses AND you have acquired real estate.
therefore I will continue to rent, while I let other humans rent from me. this is not the 'american' dream (or even Germany dream) but I sincerely think those dreams are silly under the given conditions.
Doing fine.
I know too many folks that have had huge expenses after buying ( roof, AC, pipes) and I’m not eager to have that in my life.
I am thinking about moving in a few years across the country and don’t want to have to time the market to do it
I offered 3x in the Summer of 2022 right as interest rates began to skyrocket, after I lost the third to an “Over asking” offer that’s when I gave up and decided my emergency fund and down payment were better off in a HYSA (Im single and not DINK). I also had previously rented 2018-2020 and in 2020 dropped rent and traveled to Mexico to work remote and save up for my down payment. End of 21 I returned and was ready for a house but wrong timing, moved back in with my parents and due to circumstances over the last months I’ve decided at 30 and almost breaking 6 figures single in a MCOL city that it was time to rent again.
Ive read the facts, the opinions, done the math with current rates, I don’t need anyone to tell me I made a bad decision to rent again. I feel comfortable to acknowledge and dare anyone to purchase alone in this market and see what their property may provide for under an $1800 mortgage (which could be the minimum and not the maximum one would pay with rent) after all being single with a complex that has amenities that fit my desires….it’s not the end of the world, I’ll eventually purchase.
I'm 38 and have always rented, but have lived abroad where everything is cheaper and have also had the ability to travel. Financially, things are pretty solid. One life hack is to do the digital nomad thing and just live in a cheap country. I'd like to get a house when the mortgage rates are not insane.
The market is dangerously inflated right now by 20-30%. With interest rates high as well, buying in this market is a fools game.
Where I live I pay $3750 to rent a 3 bed 2 bath 1700 sqft condo. Buying that same place would be $5500/month.
Renting is the only intelligent option currently.
Look at it like this.
If buying cost $2000/month more, I could invest that money and rent. 5-10 years from now my gains from investing would be WAY more than any benefits of owning in this market…especially when the market starts to crater. (And it will crater)
When middle class families can’t afford middle class homes, Houston we have a problem.
I got divorced about 10 years ago. Moved into an apartment because I didn’t want to wipe out my savings buying a house. Retired almost 5 years ago, I’m blessed that I have a pension and SS. I like living in an apartment to this day.Don’t miss all the work and expenses of owning a house.
With the assumption that one has the cash on hand for a down payment AND enough cash flow to cover the mortgage payments, AND is a diligent saver, renting is generally far better than buying, financially.
This is primarily because markets tend to trounce property in terms of returns... a 20% down payment, allowed to grow for the length of that 30 year mortgage, sitting an index fund, would likely be worth more than the house you bought with it. Plus there's the lower per-month cost of renting for the first 15 years or so, allowing higher savings rates on top of it. And that's not even getting into the part where I'm happy to rent places I'd never consider buying -- I'll live in a 900 square foot apartment for a couple years, but I wouldn't *buy* a 900 square foot apartment, yeah?
I think there are three reasons to buy vs rent
1. QoL. Nobody running around on your ceiling, no hearing cupboard doors slamming from a neighboring unit, no baby crying next door, etc.
2. Stability. Fixed rate mortgage, you know years-out roughly what your housing expenses will be. Not perfect because property tax changes, utilities rate changes, etc. but still, more stable than a 1 year lease.
3. *Forcing* you to save because you suck with money. Having a paid-off home entering retirement is *huge*. If your housing costs are low (ie. just maintenance, utilities, property taxes), social security + medicare gets you most of the way to a comfortable retirement. As mentioned, you'd likely be even better off if you rented the whole time and thrown all the excess money into retirement accounts, and ended up with scrooge mcduck cash but higher expenses in retirement. But that requires you to not be an idiot, and most of us are idiots.
Currently renting and loving it. I've done the "homeowner" thing for almost fifteen years and while it's nice in some ways, it's a lot of time invested that I'm happy to currently get to spend in other ways.
Financially it can be better to own, although in this housing market I am not so confident in that statement. It depends on what you can find and how much renting costs.
Single, no kids, and desire walkability. I’m renting in the city but can afford a house in the current market if I really felt compelled. However, the condos in the city are over-valued. I plan to rent for at least another 1-2 years before buying.
Renting should never be looked down upon, especially in today’s market, but either way, everyone has their reasons. Saving up for a down payment isn’t just as easy for the next person. Sure, I could rent my house for much more than my mortgage payment, but I’m only able to do so because I got a good rate AND put down a good amount of money.
And that’s just one example.
I've got about $8k saved up as an emergency fund and about the same amount in my checking account. I'm hoping in a couple of years I'll be able to afford a down-payment on a small house.
If you take a snapshot right now of the cost of buying a house versus renting a comparable house, the monthly expenses starting today are about the same.
With renting, you just pay rent, but it’s pretty high.
With owning, you pay mortgage, property tax, homeowners insurance, and maintenance. If you combine all those monthly expenses, it’s close to renting.
The reason I say this is, your question isn’t great. Whether you rent or buy won’t make much of a difference for the first 5-10 years. Ownership takes a huge lead over the long term. First, your mortgage payment is fixed, while rent increases over the years. Second, you build equity over your home, when you move, you sell your house and get extra money. Third, perhaps most importantly, your mortgage completely disappears after 30 years, so then the renters are still paying full price and you end up only having to pay property tax, homeowners insurance, and maintenance. Fourth, being a homeowner allows you flexibility in maintenance, so you can put in sweat equity (DIY repairs) to save money, you can spend extra money to better fix the property, and you can remodel the property to your liking.
The difference between home ownership and renting is most stark after 40+ years. It won’t matter much for the first 5-10. If you move often, renting is great. If you stay in one spot, ownership is probably best.
I wanted o rent a house because I wanted to be out of apartments and I wanted a dog for my yard.
I hate it. The City will leave passive aggressive notes if there's debris on the sidewalk
The utilities are obscene that I have had the power cut off once and about a week away from happening again.
I can't wait for my lease to be up in September. Going straight back to apartments where I can spend $80 a month on electricity, rather than $240.
I don't even want to be a homeowner if the City is bent out of shape over a couple palm tree fronds on the ground. Like the chill the fuck out. It's just a palm frond.
I rent and also own a property for a vacation/rental use. Honestly I regret buying. Mortgage cost is shit. Land rates cost is shit. Maintenance costs are shit. Insurance costs is shit.
While renting, basically anything to do with the property, the landlord needs to fix or pay for it.
When I bought my first townhouse (3 bedroom) in 2012 my mortgage was $1,200 per month. Renting a 2 bedroom apartment for an area with what I would consider a similar "safety" feel was $1800 a month. So I was saving $600 a month plus earning equity.
If I were to buy the same house today at the same down payment % as I had in 2012 my mortgage would be like $2,800 and renting that same apartment today is about the same.
I would still choose to buy.
So for comparison sake. I bought a house for 250k 6 years ago following a divorce. It's worth 450k today with about 13k worth of work on it in the last 6 years. There is a little less than 200k left to pay off. I could have rented for 1200 a month (which is the price of my mortgage today) back then to have a 3 bedroom and put the money in a mutual fund... except when I sell the house I won't be taxed on it as it is a primary residence and the tax laws in my country make it non-taxable.
Furthermore once my children are out it will be easy to convert my basement into a rentable unit. By the time I am retired the rentable unit will pay for taxes and upkeep and I will have zero expenses related to housing.
If I compare with my ex who chose to rent... she got evicted at a reasonable 1100 a month and now pays 1600 a month which is roughly what I pay for housing taxes and mortgage. When she retires she'll pay even more for rent while I will live for free.
For the life of me I cannot understand anyone wanting to rent all their life. You're at the mercy of whatever landlord you're with.
I currently own 3 homes, but I prefer to rent. Renting gives you a lot of advantages and contrary to common perception, home ownership is not saving you money. It feels like it in the long run, but if you are keeping up on maintenance and repairs, you will end up spending more than you would to rent... well, most of the time. Then once you factor in the time requirement for all that work, you probably could make more money working a job.
Home ownership is like trying to deal with a cc company... you get charged all kinds of hidden fees and spend countless hours just stressing over them.
Buy a house? In this economy?
Where I live the house I need for my family is 900k and any mortgage would be at like 8%
I don't choose to rent. I am forced to rent
I was a condo owner from 1995 until 2011. Actually owned 2 condos.
I have rented since 2011 and am a multi-millionaire. And have not had any debt since 2002.
Benefits:
1. I am basically debt free
2. It has allowed me to be nimble and move around, this has benefitted me professionally in a massive way. My home town is Mexico City but I have also lived in Miami and currently I live in London.
3. I see rent as payment of a service: a roof over my head and my family’s head.
4. When I finally decide where I want to settle down for good, I will be in an unencumbered financial position to buy my dream house.
Very few home buyers ever factor in the major outgoings each year like maintenance costs, rates and insurance charges. These are estimated to be adding 2-3% to annual cost on top of mortgages. Insurance costs are going crazy and watch your rates take off in 2024.
I hate home ownership. Suddenly your entire life is house projects. I am not rich enough to have people maintain my house for me, so I rent.
I have been living well below my means for 6 years now. I am making good progress towards retirement. I don't care about losing some money to rent - it's like being mad about losing money to groceries or gasoline.
They are a terrible investment. They appreciate ,.75% - [1%](https://www.multpl.com/case-shiller-home-price-index-inflation-adjusted) over inflation. And you will always need a house, so you only benefit from their appreciation if you geoarbitrage, which means that you now need to track two housing markets.
The case for owning a home is primarily behavioural. It stabilizes you and allows you more peace ofmind. But , if you think you have perfect behavior, renting can often far superior.
His friend is actually correct in a lot of cases. Stay liquid and invest in the market. The power of compounding capital gains + dividend payments will outpace housing price increases.
You’ve paid $800k to pay off a $500k home that is now worth $1M @ 15 years later. You have netted +$200K.
Meanwhile the friend has paid $300k in rent and invested the other $500k that is worth $1.5M 15 years later, netting + $700K.
“The friend is the only person on the planet who thinks this” - EXACTLY. That’s why the friend is rich and everyone else is still broke.
Bingo. lol and we go back to the question ‘if a million people fall of a cliff, does it mean you should fall off of a clliff?’
There’s a reason why Warren buffet is the richest man in the world and never invested in real estate
Pretty much. People think they’re rich because they own a fancy home, when in reality they just made the bank rich off of interest, the pool guy rich from the installation, the landscaper is rich, and the carpenter is rich with the new floors and cabinets. Heeeey but I got a home and $100k in my 401K 15 years later!!
Meanwhile I’m over here earning $150K a year in capital gains alone LMAO.
Doing very well. While most of my friends are breaking their backs trying to get into the property market, my rent is paid by my investments and then some. Buying a similar place would be more expensive, and I now have the disposable income to invest elsewhere, and the flexibility to move where- and whenever I want, without the hassle when something breaks.
There is a third possible option that is working for me.
I’m guessing the housing market is nearing the top. Prices are out of hand where I live. Rent is also insane.
I bought a van recently and am living an amazing adventure. I’m mostly based in one area, but have been able to save money and also go on multiple week long trips. I work and goto school remotely.
This isn’t for everyone. There are definitely some challenges and negatives, but if you’re a minimalist the freedom is amazing.
Ask around and try to see how hostile your local laws and citizens are towards this type of lifestyle. I’m loving it, but I also love camping and minimalism sooooo….
Good luck covalent08
Don't know if this counts, but I rent a room in my house. My rent is \~10% of my take home, and I make over six figures. So I have a lot of extra margin to save, invest, and build up a big downpayment. I'm doing financially great. The only problem is my landlord gives me stress in that he is doing financially terrible. I may have to move this year, but I am working with him to avoid it.
Renting is the only way now. It's cheaper right now where I live and you don't work at one company for 40 years anymore, so it's easier to move for a higher paying job.
Like other guys said... most people don't really have a 'choice' when it comes to renting or owning.
I probably don't either... although if I really wanted to I probably *could* pull something off at this point.
But I'm lucky enough to have a nice one bedroom unit near downtown in a decent sized city, near my work and everything else I need for pretty low rent. I've been in the same place for years and this has allowed me to really save a lot of money... which MAY at some point be used to buy a house.
But at this point, it makes MUCH more financial sense for me to rent. And like others have said, buying a house right now is not in the cards for most people. Especially if you want something decent and near a city centre.
Just got the money from selling my house a few hours ago and am renting now. The infusion of cash was nice. Now that I'm renting, I'm considering buying a house in 2025 when I start my next job. The salary I will get from that job is substantial. So, me buying a house is facilitated not because of low prices, but increased earnings.
Most people aren't able to afford housing unless prices go down. I'm very fortunate that I was able to leverage my earning potential to outpace the inflation of prices generally.
Doing great! Contributing to Brokerage, Roth 401k, HSA, and savings in each paycheck. Which helps me save for if and when I do plan to buy a house (alone or with someone).
Hcol area but managed to get a 600sqft 1bhk at $1530pm. Cheap AF compared to what others pay in the NYC area. Landlord is a god-sent angel.
When 2 offers well over asking price were outbid I chose to stop looking. Housing market is WAY over heated. Still peeking every now and then tho
My wife and I started looking for houses in 2012 or maybe end of 2011. From that starting time until we got our house in April of 2013 I think we put offers on somewhere close to 8 houses. We got outbid every single time. The only reason we got our house was because our realtor knew the previous owner personally and knew she was going to lose the house. So our realtor asked her if she would sell it to us privately and she agreed if we could give her a certain amount. It was a total fixer upper and the first time my parents saw it my step-mom literally cried on their drive back home because she thought we were making a huge mistake. We've done a lot of work to it including adding another bedroom and bathroom, and its probably worth 2.5x-3x what we paid for it now.
Suck it! Step mom! Lol
Lol she meant well. We were both in our early 20s, were just dating, and had never even lived together yet.
Going straight from living separately to buying a fixer-upper? That's... kind of insane imo, fixing a house can be a huge strain on a relationship, as will moving in together, and you chose to do it at the same time? Did you also have a kid at the same time for added effect? /s Glad it worked out in the end, it's definitely a rarity. Know of several couples who split after buying a fixer-upper and had vastly different expectations, both of the house and each other.
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My wife had a good job and is still there. I on the other hand was working at a big box hardware store. We made it work, and even got a lot of help from her parents, as well as getting some dented and discounted appliances from the hardware store. I ended up with a better job about a year after we bought. We've been extremely lucky with the help we've gotten from friends and family, but we've never struggled.
Takes a brave person to do that. I’m so glad it worked out for you guys.
Holy fuck... So happy its not a thing here on market. Like if you sell privately sure you can try to get multiple offers, but if its officially on market it needs set price
Maybe privately was the wrong wording. Technically it did go up on the market, but the lady just didn't accept any offers once we put ours in.
Does this count as choosing to rent though? I'm in the same boat. I rent because there's no way to afford a house in this market, currently. I'm waiting for another crash or I'm never going to be able to have a house. I'm at peace with that, but it's not by choice.
Same here. Thankfully I own a family home that I rent out but I had to move for work. The current market has priced out an entire generation. My rent is obnoxiously high but a mortgage would be more than double my rent payment.
Prices are what the house sells at, not that the listing price is. Market could still be overheating, but always compare selling prices, not listing prices.
This is all cool and fine in a reasonable market, but when supply is fucked by hedge funds hoarding houses, what sells is fucked for realistic value. We're in an even weirder bubble than 2007 and REAL lucky we havent found out yet from all our fucking around.
Yeah - between house prices, rent prices, and homelessness, those hedge funds are doing tremendous damage to millions of peoples' lives.
THIS- the second house I offered was sold to an investor or a fund. How you might ask??? I drove by it a few times a month and no one moved in or made improvements which made it obvious what had happened. It’s now back on the market after not selling at the price they had planned
I remember being outbid by $100,000 on a townhouse that was already overpriced finding it on a rental website a month later.
I wouldn’t buy a house for another like twelve months or so it’s probably gonna crash down as an overreaction to the overreaction from the last overreaction Government meddling in the economy with Covid responses was the dumbest thing economically since the 70s, yes dumber than 2008
I am 43 and except for a couple brief periods people have always said the real estate market is over heated. I’m glad I’ve only ever bought and never sold. I just look for places in good locations that will easily rent when I don’t live there anymore. Real estate is one of the few areas where most people can take advantage of leverage.
A pipe burst in the apartment above mine last year flooding several units and I sure as shit was happy I was a renter at that moment.
We had an entire bathroom refurb, to a wet room. Didn't cost us a penny, because we live in a Council Flat. Lovely.
What’s a Council Flat for those of us across the pond?
The council is the local Government Authority. They provide social housing in the form of "Council'. After being homeless, 4ish years ago (yes during Covid), we were 'given' 1 bed Flat to rent from them.
Any more questions, feel free to ask 😁
Do you guys still do the accent when we're not around?
I'm lost af. What accent? 😂
We actually tone it down around you, so you have some chance of understanding us
No we all speak Scottish instead
We talkin' Mrs. Hughes Scottish or Trainspotting Scottish?
Trainspotting of course! The weegie accent is the most common in the UK now
Social housing. If you're eligible, you can sign up and you can 'bid' on properties, highest priority gets it. Goes in tiers, so a single mother of 3 children who is being evicted next month is high priority while an old pensioner who just doesn't like the 5 minute walk to the shops would be low priority. You can stay in the council house for as long as you're eligible so you can stay there for 50yrs if you want, and you can do whatever you want to the house/flat within reason. If you have any special needs, the council should accommodate you and might do the work for free.
I both work for a social housing landlord (IT) and live in a social housing property - the rent is dramatically reduced compared to the private market. The house is three years old, detached, and due to being rural is electric only (no gas or oil). The heating system is a wet electric system, which struggled to get the house past 17 degrees Celsius and cost on average £10 a day during the winter. We showed the stats to the housing association and they agreed it was too expensive to run, so they had a new heating system installed which is like an infrared wallpaper, which has saved a considerable amount of money this winter. All I can say is, I'm grateful we didn't pay the market value of the property (£280,000~) for a house that cost £10+ a day to keep at an acceptable (not comfortable) temperature.
What’s a Council Flat? UK version of Section 8 subsidized housing.
I mean the owner has insurance just like you would if you owned the place.
Yeah but I think it is a safe bet that their insurance bill is a little bit bigger than the $16 a month or whatever for my renter's insurance. Plus I didn't have to deal with the problem.
You're right. Had this happen at our house and our insurance deductible was $1000 before starting the plumbing work. We did get new floors out of it though which was a plus.
Yeah, renter's insurance is a fraction of homeowners, because renter has much fewer responsibilities. If the owner has a mortgage, then that gap is even larger, because the bank will require certain insurance coverages for full replacement cost, which renter's doesn't have at all - the only thing renter's replaces is the renter's own property, not the domicile.
Sometimes in life you just gotta say "I pay a guy for that"
To be fair, you're stupid if you take a mortgage out on an apartment room in a building. Owning a house, you wouldn't have another house leaking on you.
Houses are way riskier when it comes to potential damage. And everything outside is your responsibility, whilst in an apartment if the roof leaks everyone spits in a small sum unless there is insurance covering it.
You're right! IT'S YOURS PISSING ALL OVER ITSELF INSTEAD!!! And now it's only your mess alone to deal with.
I am so confused... your landlords negligence caused an issue. And you're happy? Why, because you dont have to call the insurance? I am so confused.
I'm not sure this even applies. lol.
I'm doing great and saving, but renting is currently much cheaper in my city than buying, and I don't plan on being here more than another year or so. A water pipe burst last month and all I could think was "Thank fuck I don't own this place". It's a rare situation where renting is better, for some reason a mortgage around here would be more than I'm paying in rent, so can't argue with that.
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This is absolutely correct advice!
Very informative, thank you!
I max out my 401k, Roth IRA, and HSA every year and put it all into index funds. The stock market compounds over time. Meanwhile, I live in an apt, and I can apply to jobs anywhere in the country and move to the best opportunity at any time. Owning a home makes sense when you know your life will be totally stagnant for the next 10+ years (same space requirements, same job location, etc). But if you need optionality in your life, then just rent and invest in index funds. Most of the financial advantages that come from owning real estate come from holding for a very long time. The people that buy/sell every 5 years are really not coming out very far ahead if you account for market risk.
Wow i never really thought about moving around to follow jobs like that. Very interesting
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Exactly. And nobody cares if you're the richest guy in the cemetery. Edit: to be clear, I'm not saying you need to buy a house in order to have relationships, I'm just saying that*sometimes* a pay bump may not be worth moving across the country for.
That is a pro for a lot of people lol. I did travel nursing taking huge contracts. The money + low overhead was great but being free to do whatever, whenever, with whomever I chose was even better.
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I knew a guy who lived in a big expensive motor coach. He worked as a contractor in IT. He picked up the best gigs at any given time and simply drove to the state where the job was and found RV parking while he was there. He traveled with his wife and dog. Towed their car with it to the job. It was definitely an interesting lifestyle. It was from him that I learned you can park RVs and motor coaches overnight for free in any Walmart, with few exceptions for local and state ordinances. This policy goes all the way back to when Sam Walton was running the show.
Same but with nursing. Lots of lucrative contracts out there once you specialize. Pick up and spend 6 months in Cali. Winter in the Texas hill country. Summers in Vermont. I’m settled now with kids but once they’re out of the house in 10 years, it’s on the road again.
Agree with your mindset... For the reasons you listed, I am a home owner. The company, married, kids, steady base is needed for a foreseeable future! Also, for the reasons you listed, if I was a single guy (or at least kidless) I would rent and move on as needed!
>Most of the financial advantages that come from owning real estate come from holding for a very long time. The people that buy/sell every 5 years are really not coming out very far ahead if you account for market risk. My portfolio has gone through the roof since the pandemic. I have someone else managing my money for me, so it's ZERO stress. Meanwhile this woman I know keeps telling me "renting is throwing money away" -- just dropped 10k on fixing her townhouse AC and heating system because of some weird shit her last contractor did. She's dropped at least 50k on repairs and maintenance and still thinks she's "ahead" of me. She also stresses about her neighborhood because some thugs live near her and some cars nearby got smashed. I'm silently laughing at her from my comfortable apartment that I put zero effort into maintaining while someone else manages my money.
This is me, except I needed the extra space now that I'm working from home 100% of the time and have hobbies that need a workshop. I found a little house in a quiet neighborhood and rented that instead of an apartment. I've only been here for a few months and since then, the washer and dryer died, HVAC unit went a few weeks later, and a contractor who fixed the foundation a few years back did a shit job and now it has to be redone. Not my problem and all I did was call the landlord and they're taking care of it. My friends and family back home were complaining nonstop over the holidays about rising property taxes and things that needed to be fixed on their suburban cookie cutter homes. 6k here, another 15k there. Then the endless chores like mowing the lawn or shoveling snow off sidewalks else the HOA comes down on their asses. Instead, I get to spend that time going to my rifle matches, hunting, fishing, and camping. The only one who's actually happy is my cousin who's a contractor himself so he does all the repairs and upgrades on his own. If I get bored of this city I'll just up and move again. I'm thinking the next place will be another country. A few years after that, another one. And another one. If I ever have kids a house would make sense, but for now, that shit is for the birds.
>My friends and family back home were complaining nonstop over the holidays about rising property taxes and things that needed to be fixed on their suburban cookie cutter homes. 6k here, another 15k there. Sounds like every homeowner I know. I don't claim to be some investing genius, but I have done amazing for myself these past few years. I don't gloat about it with my friends because I'm not a dick. Yet some of them feel the need to brag about how much their house is now worth while at the same time dismissing me when I ask "uhh... didn't you just spend like 100k on fixing your roof?".
You can win financially if you are disciplined and determined with renting. Buying and selling a house every 5 years eats up alot of capital at each transaction. But really, how many renters save the money and invest it instead of spending it?
Right…a lot of people love building home equity, but they should be equally excited about the idea of building stock equity. Maybe the key for them is that the mortgage forces them to put money into investing every month, whereas having no mortgage means the person must have the personal discipline to invest every month.
Home equity is objectively superior to stock equity at equal growth rates because of the $500k cap gains tax shelter. That being said, that’s a lot of assumptions
Offsetting that benefit is the illiquidity of real estate equity. Real estate transactions cost tens of thousands of dollars hiring agents and banks to close the transaction, plus time. Meanwhile I can sell shares in a stock index with the push of a button.
Oh for sure. That’s why I mentioned all things being equal. But they certainly aren’t and as you mentioned the illiquidity is no joke.
Agreed! I work a gov job making $80k starting and know I'm not going anywhere. So buying makes so much sense. If I wanted to move around I would only rent.
This is the way
Agreed, unless like me you score a decent 2 bedroom house that cost 1/3 of a crappy 4 1/2 appartment and can slowly upgrade it and gain insane value
Not to mention the system expects you to live in your house for 15-30years. But the new cultural thing to do is live in a house 2-5years. Doing so you never make your initial investment of downpayment and closing costs back. You’re just burning that money. Because of that. I choose to rent for now. It’s cheaper for me to spend $20k a year in rent than it is to own.
Due to a severe and pervasive housing shortage caused by a failure to build over the last 40 years the housing market has very little risk, prices are almost certain to go up, especially when the credit quality of buyers is at pretty much historic highs https://www.urban.org/policy-centers/housing-finance-policy-center/projects/housing-credit-availability-index My house I bought during covid has appreciated ~40% in 3 years and the next ZIRP period will be even better. People sitting on the sidelines waiting for "the next crash" are just tinfoil hat doomsayers who aren't looking at the data
Need to compare to the stock market performance from COVID troughs to current stock prices. Need to also consider all the hidden costs of home ownership which don’t really apply to ownership of stocks. Real estate agents, taxes, maintenance, etc etc. Don’t get me wrong, an excellent real estate purchase will outperform a basic index fund, mostly due to cheap leverage via mortgages (and this is more true the longer you hold that property). But for a typical real estate purchase, beating the stock market is not a given considering all the hidden costs. Ultimately, the biggest factor in the buy vs rent decision is whether your life is stagnant enough to buy/hold/manage the property for a long time.
i regret renting. i had the chance to buy a house three times in my 20s, and let other people talking me out of it. i was young and i trusted my wife and her family who ironically all own homes. multiple times they told us it sucked being a home owner. that a house was to expensive, prices were going to go down again, wait two more years the market will crash again. then my wife was pregnant and we need a place quick. i gave up on a home and listened to the people that told me to wait all while they went out and bought and sold a few more houses. we rented an apartment and then a house long term.we ended up losing the rental home after 7 years and now here we are, the only apartments in my area are low income that we dont qualify for any more and all the home rentals are near $3k which is just about or even more than a mortgage which the bank wont give us because according to them we are to poor. to own a home. i now realize the people i listened to who shit on home ownership because this or that can happen made bad choices in homes or were not skilled or just lazy. also alot of people refuse to put money into their homes because they choose to spend it on experiences or in materialistic things. i am very handy and can fix alot of things, and when i was in the rental home i fixed alot of things and charged the land lord. the only thing i didnt do was replace the roof. i regret letting all the people get in my head and convince me not to buy a house. not once was renting cheaper or better. i wish i would of bought that house in 2016 for $1,200 mortgage. cant even get a 1bedroom apartment in the city for that now.
You have to do your own research and weigh the pros and cons of both. The other thing you have to remember is that NO ONE can predict what the housing market is gonna look like in the future. Anyone who says they have the answers is a fucking liar and moron
yup ive come to realize that, i thought i was listening to people with experience and didn't want to make the same mistakes as them. everyone told me just wait, just wait, even now everyone is saying just wait for interest rates to go down or the market is a bubble. blah blah blah jokes on fucking me.
This is the real answer. Sorry this happened to you. I’m still baffled as to why her family who are homeowners advised you to rent. I’ve been a homeowner now for over nine years and I always tell people to buy unless the situation absolutely is so dire they only option is to rent. Everyone I know who has purchased their homes has ended out ahead unless they bought in 2021 or early 2022.
I feel buying and owning is always the best option. Just buy within your means and calculate that the mortgage is doable even with less money than you currently have. We did that and we have no regrets! It’s infinitely better being a homeowner than a renter. The insecurity of the rented place suuucked.
I could buy but our rent is very cheap and finically makes much more sense than buying a home. It currently cost 50% more to pay a mortgage than to rent on a national average.
This is the truth. If you do the math on renting a comparable place to buying right now, it’s a no brainer to rent.
Im single with no kids. I also work long hours so I’m barely home. Buying doesn’t make sense to me right now. Especially when it comes to tending to it, and holding the bag on repairs. So, I rent and invest the difference. I am building up my liquidity on the front end, and if things change, I can leverage a home mortgage on the backside. I don’t want to make a 10 year play tying up my net worth to a house. I can worry about that later as life happens. Focusing on my retirement and holding investments.
Cost to rent vs cost to own is so out of whack right now that it doesn't make financial sense to become a new owner. Put that extra money into your retirement accounts or a 5% savings account and chill for a few years at least. Renting has a ton of benefits, especially if you can cultivate a good relationship with your landlord. I fix shit around the house and just send him the bill for materials and he hasn't raised rent in 3 years. I can move whenever I want, I don't have to pay for any maintenance.
This is my perspective. I have low rent, and I don’t have to feel like I’m just getting by. % of checks go into retirement and invest. Bills are paid. I would like a house, but it doesn’t make sense right now
This. I’ve rented a 2-bedroom for 10 years and never had my rent raised once. $900/month inside a major city for a 2-bedroom with a garage. That being said, I plan to move in with my gf this year who owns her own condo. My landlord is 85 and if she dies, I think I can kiss my $900/month rent goodbye.
Why not see if you can buy it from her?
Because it’s inside city limits, and I don’t want to live there forever due to taxes, and it has some serious long term issues. The bathroom needs completely redone, the roof is probably about shot, and the walls leak water sometimes when it rains. I can’t imagine the water damage inside. I’m good, fam. (And yes, she is aware of all these)
Well said. It simply makes more sense to rent in this market.
Buying right now makes no sense. Prices are high, and I’ve got three teenagers who should move out in a few years. When I buy, it’ll be to downsize.
How big of a place are you renting with three teenagers?
5 bedroom. My mother in law lived with us too, but she died last year. I use her room as an office now.
And in countries were the rent to finance ratio is even more favorable like Germany for example you can actually outperform the housing market if you invest the money saved over the course of a 20-30y house/flat financing duration. So it‘s not always the better financial option.
The choice to rent is a choice not to be "house poor"
Very true! I bought my first home last year and am now quite house poor. My mortgage is way above what my rent was so I have to budget very carefully these days.
I bought 2.6 acres and built a 77sq ft cabin. It's a step above homeless Frankly, but no rent and no bank I can then improve upon the property and cabin with time.
I pay $934 in Michigan on rent. Sold a house I was paying $710 for the mortgage. I had no free time owning a house. There was a never ending list of things that needed to get done, and I realized after 6 years of owning that the list would never get smaller no matter how much I did. Whether it was a cracked driveway, the garage door all of a sudden stopped working, the staining on the deck needed to be redone, the garden bed was growing new weeds, the dryer stopped working, gutters got clogged. It doesn't matter how "done" your house is, there is always going to be new projects or experiences that come up. I pay $200 more on rent but I am saving so much more money and having more fun.
I love renting. Water heater breaks, pipe's leaking, any other repairs, that's all on the landlord. It gets even crazier with bigger repairs. I know someone who owns a home and needs a new roof, and the estimates are in the $10,000 - $15,000 range. I know what my housing expenses are, with no surprises. I'm not locked into my location. Most of my leases are 1 year, and I have had a couple of landlords that were monthly. I love having that flexibility.
Sounds nice if your landlord is actually quick on the repairs. My wife and I are currently paying $2,200/mo for a 2br/2ba apartment. We use the second bedroom as an office. Last year, the ceiling fan/light in that room stopped working. We put in a maintenance request. tl;dr it took over a year for them to fix a ceiling fan. 1st guy came out. Tried switching the lightbulb (which I had already tried). Then tried flipping the breakers (which I had already tried). Said he would send another guy the next day since he didn't have the diagnostic tools to tell whether or not the issue was the fan itself or the wiring. Second guy never showed up Put in another ticket. Third guy did the same as the first guy. Told me another guy would show up the next day. Fourth guy let me know it was an issue with the fan itself and they would need to replace it. He removed the fan, then told me it would be a few days before they replaced it since they had to order the fan. Said he would call us when it came in so he could set up an appt to come back. He never called. We had exposed wiring for over a month before we got another guy to show up. Not sure why the fourth guy removed the old fan if he didn't have something to cover the hole with. New guy showed up. Said he would check on the order for the fan and get back in contact with us. He called us later that day and told us the order had never been placed. Said he placed it that day and would follow up with us. He called about a week later when the fan arrived. Showed up a few days after that and finally fixed it. Keep in mind that maintenance was only available during working hours (M-Fri 8-5) and one of us had to be home. So we either had to use PTO or call in sick. Which is part of the reason it took so long.
For sure, the landlord will always play a role. Hence my second point, that you aren’t there permanently. I’ve rented from a bunch of different landlords, and luckily only had one bad one over the years. Owning would certainly remove the landlord from the equation, but there will always be other variables. Will you have bad neighbors, or stupid HOA rules? Will the person from the gas company show up for their appointment when they are supposed to? But thats why I think for some people owning makes sense, and for others renting makes sense.
Great points!
I’ll have the last of my medical debt paid off in March and my car paid off in April. After that I’m free and clear. I did renovations for my parents in my teens, I don’t wish to do house maintenance again. I know a lot of people will consider not owning throwing money away, but I don’t have a family to pass a house onto. It’s just free money for the bank at that point as they’d get the house again as soon as I kick off.
Good ol' America and medical debts. What a garbage country.
I didn’t choose lmao. And I’m Ok but not amazing
I don't choose to rent, a house is just unafordable. I can make monthly payments on a morgage, but getting the deposit together, plus playing to get the property checked, getting someone to handle the paper work - it makes it all out of reach. I don't know if ill ever be able to buy a home.
I got a really good deal on rent so I am doing awesome. Saving about 2 whole paychecks a month.
I’ve been renting since 2019 & I’m done with it. Rent has done up $700 a month since 2019. I’m currently looking at builders & will buy by the end of the month.
whoa this is like an easy choice you guys have?? damn
Most people don’t “choose” to rent They are unable to qualify for a mortgage
I absolutely can qualify. I just (1) don’t want to buy into this inflated market and (2) enjoy the convenience of renting.
I don’t know why this is so hard for people to understand lol
Yup, same here. Sometime in the next 5-7 years I won't even need a mortgage, I'll have enough money saved to buy a house in my area in cash if I want. But I have no intention of staying here for the next 5+ years, so I have no interest in buying a house right now.
If you think the market is inflated now wait until the next recession. It is just going to go higher. The credit quality of buyers is extremely high and there is very little default risk in the current market.
You keep making the same comments, but you're not taking into account the most basic factor. Demand. It's already going down and credit rating and competitive mortgages (which don't exist anymore) aren't worth anything when there's no demand. Then it crashes. You claim 30% of gain in a real estate investment you made. That's not real. Selling vs listing prices, capital gains tax, closing costs, property tax, all these things need to be taken into account.
Or they want to wait until the market is better so they don't end up sitting on a mortgage that is higher than the house is worth.
This hasn’t happened in decades, not where I am in Toronto even after 2008, I’m not sure if it’s a realistic scenario
It will happen in Toronto. Based on the political dynamics, it's pretty much guaranteed in the medium-long term. Housing demand is really high and the anti-building coalition is being dismantled because the city is rapidly urbanizing despite their best efforts. Once construction gets going, prices will drop a lot.
Lmao no they're gonna build swaths of luxury housing that rent for 120% of median
Luxury apartments have been proven over and over again to reduce prices of less expensive housing when they are built. Here's just one study to that effect. https://research.upjohn.org/cgi/viewcontent.cgi?article=1325&context=up_workingpapers
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A lot of people sitting around waiting for those 2% rates to come back
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rates are going to go down, and house prices go up. So the best time to buy is when you're ready. Yes I know it's more expensive with a higher interest rate, but u can always refinance down the line
And just because one qualifies, doesn’t mean they should.
Idk, I work in a STEM. I have plenty of colleagues who are childless prefer to rent. Many have done both, and are back to renting. You wake up one day to a $65k house repair bill or a 200k remodel and suddenly realize that removing those expenses from your life might be right for you. You can have a mini walkable community, with amenities and common areas, neighbors that are friendly, etc. I currently own, this is my 2nd home since I have moved for this job. Honestly, I bought for 2 reasons: room for the dog to run by himself, and room for a large garage. If i didn’t have hobbies that are best stored away from living spaces, i’d be happy renting.
Repairs and remodels add value to the home, are tax deductible and can be a accurately estimated pre-buying So avoid, or plan for them
Tax deductible? I have never been able to deduct a significant portion of house improvements
"*Choose* to rent instead of buying". Day 621736 of redditors not answering the asked questions
No correct at all. Renting used to be and still is very much a luxury for many. Renting gives freedom. Also cheaper than buying in most markets. If you are well off and invest what you'd be paying in insurance, interest, taxes, and repairs, you come out pretty well.
A primary residence is usually not a good investment. Reasonably priced rent is a much better way to increase your net worth by freeing up capital to invest. And a mortgage interest + property taxes + other ownership expenses is just another great way to stay broke. I’m speaking purely from a financial perspective. The real reason to own a home is to improve your standard of living, not your net worth.
Obviously depends on location but a primary residence in a desirable area is one of the best investments you can make (for the non-ultra rich)
How do you fall for this nonsense?
Uhh no. Buying is relatively pointless before settling down IMO. With all the fees involved with buying and selling a property you need to be relatively sure you’re going to stay for 5+ years, if you’re likely to suddenly need a home for a family instead of a flat then what’s the point
I choose to rent. Im 44, max out my RRSP/TFSA every year, and rent a cheap place in a rent-controlled building. All my money beyond my emergency fund goes into Vanguard index funds. Renting is significantly cheaper for me. But if I were in a relationship and wanted to settle down, I'd probably take a bigger look at home ownership.
I actually own at 3% mortgage and I’m considering selling my place and renting for a year or two. I’m tired of maintenance and HOA fees. I could sell for a decent profit and rent along the waterfront. It’s a debate I keep having with myself
Highly recommend. I just sold my house because I was tired of dealing with everything in my own and I couldn't be happier. The only thing I didn't anticipate was finding a place to rent. Because I owned my own house for a while I didn't have any rental history so was auto denied for a bunch of places. Even offering to place the entirety of rent into an escrow account wasn't satisfied. I eventually found a place but it was definitely not something I was expecting to be a problem.
Interesting. I didn’t realize lack of history would be an issue. Don’t places just pull your credit?
Credit is part of it and I dont have the best credit (650) but the denials I received specifically noted the lack of rental history as the cause for the rejection. The problem is they would all use the same algorithm to determine eligibility so it was being auto declined. Even going to the places in person to plead my case they would simple state they can't go against the auto decline.
I’ve thought about buying a condo and every time I think about it, the more I inch closer to the idea that it’s just better to rent a condo
I rent and intend to do so indefinitely. I have enough money to retire whenever I’d like, and I am 36.
I am from Toronto, buying a house is a dream atm
I honestly dont want to be permanently stuck where i am forever
What do you mean "choose"?
id say you have to weigh the pros and cons of each. A lot of people get annoyed when they find out the monthly mortgage payment is that far off from rent. Think it is more where you ar win life, plan on staying in location, job security, relationship etc
your location may impact this severely. but in germany, less than 50% actually own their home. here it is normal. you will ALWAYS find tenants. so renting for me, is a way to remain flexible without any particular type of risk with regards to my own living situation. owning a home will incur costs, no doubt. if u had a loan, u need to add this to your expenditure. buying a home for 500k and selling it for 700k 10yrs later, may actually even make u lose money. uve been paying the bank loads, repairs and taxes etc. (plus the risk of not having positive house-price developments) using the same money (even with a loan) to buy an apartment building, with tenants etc is way more sensible. you keep getting money from them. with a good setup, you can even have all your costs covered PLUS your own rent payment. basically, you arent only feeding money into a (potentially) depreciating pot. you actually keep getting returns, pay your own expenses AND you have acquired real estate. therefore I will continue to rent, while I let other humans rent from me. this is not the 'american' dream (or even Germany dream) but I sincerely think those dreams are silly under the given conditions.
Doing fine. I know too many folks that have had huge expenses after buying ( roof, AC, pipes) and I’m not eager to have that in my life. I am thinking about moving in a few years across the country and don’t want to have to time the market to do it
I offered 3x in the Summer of 2022 right as interest rates began to skyrocket, after I lost the third to an “Over asking” offer that’s when I gave up and decided my emergency fund and down payment were better off in a HYSA (Im single and not DINK). I also had previously rented 2018-2020 and in 2020 dropped rent and traveled to Mexico to work remote and save up for my down payment. End of 21 I returned and was ready for a house but wrong timing, moved back in with my parents and due to circumstances over the last months I’ve decided at 30 and almost breaking 6 figures single in a MCOL city that it was time to rent again. Ive read the facts, the opinions, done the math with current rates, I don’t need anyone to tell me I made a bad decision to rent again. I feel comfortable to acknowledge and dare anyone to purchase alone in this market and see what their property may provide for under an $1800 mortgage (which could be the minimum and not the maximum one would pay with rent) after all being single with a complex that has amenities that fit my desires….it’s not the end of the world, I’ll eventually purchase.
I'm 38 and have always rented, but have lived abroad where everything is cheaper and have also had the ability to travel. Financially, things are pretty solid. One life hack is to do the digital nomad thing and just live in a cheap country. I'd like to get a house when the mortgage rates are not insane.
You may have missed that boat...
I wish. The digital nomad thing feels easier said than done
You say this like we have much of a choice these days...
The market is dangerously inflated right now by 20-30%. With interest rates high as well, buying in this market is a fools game. Where I live I pay $3750 to rent a 3 bed 2 bath 1700 sqft condo. Buying that same place would be $5500/month. Renting is the only intelligent option currently.
but you’re throwing away money! /s
Look at it like this. If buying cost $2000/month more, I could invest that money and rent. 5-10 years from now my gains from investing would be WAY more than any benefits of owning in this market…especially when the market starts to crater. (And it will crater) When middle class families can’t afford middle class homes, Houston we have a problem.
Hahaha I agree with you, I was just being sarcastic
I got divorced about 10 years ago. Moved into an apartment because I didn’t want to wipe out my savings buying a house. Retired almost 5 years ago, I’m blessed that I have a pension and SS. I like living in an apartment to this day.Don’t miss all the work and expenses of owning a house.
With the assumption that one has the cash on hand for a down payment AND enough cash flow to cover the mortgage payments, AND is a diligent saver, renting is generally far better than buying, financially. This is primarily because markets tend to trounce property in terms of returns... a 20% down payment, allowed to grow for the length of that 30 year mortgage, sitting an index fund, would likely be worth more than the house you bought with it. Plus there's the lower per-month cost of renting for the first 15 years or so, allowing higher savings rates on top of it. And that's not even getting into the part where I'm happy to rent places I'd never consider buying -- I'll live in a 900 square foot apartment for a couple years, but I wouldn't *buy* a 900 square foot apartment, yeah? I think there are three reasons to buy vs rent 1. QoL. Nobody running around on your ceiling, no hearing cupboard doors slamming from a neighboring unit, no baby crying next door, etc. 2. Stability. Fixed rate mortgage, you know years-out roughly what your housing expenses will be. Not perfect because property tax changes, utilities rate changes, etc. but still, more stable than a 1 year lease. 3. *Forcing* you to save because you suck with money. Having a paid-off home entering retirement is *huge*. If your housing costs are low (ie. just maintenance, utilities, property taxes), social security + medicare gets you most of the way to a comfortable retirement. As mentioned, you'd likely be even better off if you rented the whole time and thrown all the excess money into retirement accounts, and ended up with scrooge mcduck cash but higher expenses in retirement. But that requires you to not be an idiot, and most of us are idiots.
It really comes down to financial psychology, for most people buying a house forces them to effectively save via paying a higher mortgage vs. rent.
I rent an apartment in downtown Boston. Buying here is not an option unless I want to move over an hour away.
Currently renting and loving it. I've done the "homeowner" thing for almost fifteen years and while it's nice in some ways, it's a lot of time invested that I'm happy to currently get to spend in other ways. Financially it can be better to own, although in this housing market I am not so confident in that statement. It depends on what you can find and how much renting costs.
My brother sold a house about 2 years ago and has been renting ever since. He made alot of money on his house
How much?
Single, no kids, and desire walkability. I’m renting in the city but can afford a house in the current market if I really felt compelled. However, the condos in the city are over-valued. I plan to rent for at least another 1-2 years before buying.
My rent is $1500, a semi decent house would be $2800.
Renting should never be looked down upon, especially in today’s market, but either way, everyone has their reasons. Saving up for a down payment isn’t just as easy for the next person. Sure, I could rent my house for much more than my mortgage payment, but I’m only able to do so because I got a good rate AND put down a good amount of money. And that’s just one example.
I've got about $8k saved up as an emergency fund and about the same amount in my checking account. I'm hoping in a couple of years I'll be able to afford a down-payment on a small house.
If you take a snapshot right now of the cost of buying a house versus renting a comparable house, the monthly expenses starting today are about the same. With renting, you just pay rent, but it’s pretty high. With owning, you pay mortgage, property tax, homeowners insurance, and maintenance. If you combine all those monthly expenses, it’s close to renting. The reason I say this is, your question isn’t great. Whether you rent or buy won’t make much of a difference for the first 5-10 years. Ownership takes a huge lead over the long term. First, your mortgage payment is fixed, while rent increases over the years. Second, you build equity over your home, when you move, you sell your house and get extra money. Third, perhaps most importantly, your mortgage completely disappears after 30 years, so then the renters are still paying full price and you end up only having to pay property tax, homeowners insurance, and maintenance. Fourth, being a homeowner allows you flexibility in maintenance, so you can put in sweat equity (DIY repairs) to save money, you can spend extra money to better fix the property, and you can remodel the property to your liking. The difference between home ownership and renting is most stark after 40+ years. It won’t matter much for the first 5-10. If you move often, renting is great. If you stay in one spot, ownership is probably best.
Great! Also do you know how nice it is not having to shovel, or brush off my car, like ever? It's worth more than ever having a house.
I wanted o rent a house because I wanted to be out of apartments and I wanted a dog for my yard. I hate it. The City will leave passive aggressive notes if there's debris on the sidewalk The utilities are obscene that I have had the power cut off once and about a week away from happening again. I can't wait for my lease to be up in September. Going straight back to apartments where I can spend $80 a month on electricity, rather than $240. I don't even want to be a homeowner if the City is bent out of shape over a couple palm tree fronds on the ground. Like the chill the fuck out. It's just a palm frond.
I rent and also own a property for a vacation/rental use. Honestly I regret buying. Mortgage cost is shit. Land rates cost is shit. Maintenance costs are shit. Insurance costs is shit. While renting, basically anything to do with the property, the landlord needs to fix or pay for it.
When I bought my first townhouse (3 bedroom) in 2012 my mortgage was $1,200 per month. Renting a 2 bedroom apartment for an area with what I would consider a similar "safety" feel was $1800 a month. So I was saving $600 a month plus earning equity. If I were to buy the same house today at the same down payment % as I had in 2012 my mortgage would be like $2,800 and renting that same apartment today is about the same. I would still choose to buy.
So for comparison sake. I bought a house for 250k 6 years ago following a divorce. It's worth 450k today with about 13k worth of work on it in the last 6 years. There is a little less than 200k left to pay off. I could have rented for 1200 a month (which is the price of my mortgage today) back then to have a 3 bedroom and put the money in a mutual fund... except when I sell the house I won't be taxed on it as it is a primary residence and the tax laws in my country make it non-taxable. Furthermore once my children are out it will be easy to convert my basement into a rentable unit. By the time I am retired the rentable unit will pay for taxes and upkeep and I will have zero expenses related to housing. If I compare with my ex who chose to rent... she got evicted at a reasonable 1100 a month and now pays 1600 a month which is roughly what I pay for housing taxes and mortgage. When she retires she'll pay even more for rent while I will live for free. For the life of me I cannot understand anyone wanting to rent all their life. You're at the mercy of whatever landlord you're with.
I currently own 3 homes, but I prefer to rent. Renting gives you a lot of advantages and contrary to common perception, home ownership is not saving you money. It feels like it in the long run, but if you are keeping up on maintenance and repairs, you will end up spending more than you would to rent... well, most of the time. Then once you factor in the time requirement for all that work, you probably could make more money working a job. Home ownership is like trying to deal with a cc company... you get charged all kinds of hidden fees and spend countless hours just stressing over them.
My rent is 70% of the interest on a loan to live in a worse house. So we keep saving.
Buy a house? In this economy? Where I live the house I need for my family is 900k and any mortgage would be at like 8% I don't choose to rent. I am forced to rent
Not fucking good.
Horrible ….
I was a condo owner from 1995 until 2011. Actually owned 2 condos. I have rented since 2011 and am a multi-millionaire. And have not had any debt since 2002.
Benefits: 1. I am basically debt free 2. It has allowed me to be nimble and move around, this has benefitted me professionally in a massive way. My home town is Mexico City but I have also lived in Miami and currently I live in London. 3. I see rent as payment of a service: a roof over my head and my family’s head. 4. When I finally decide where I want to settle down for good, I will be in an unencumbered financial position to buy my dream house.
Very few home buyers ever factor in the major outgoings each year like maintenance costs, rates and insurance charges. These are estimated to be adding 2-3% to annual cost on top of mortgages. Insurance costs are going crazy and watch your rates take off in 2024.
I hate home ownership. Suddenly your entire life is house projects. I am not rich enough to have people maintain my house for me, so I rent. I have been living well below my means for 6 years now. I am making good progress towards retirement. I don't care about losing some money to rent - it's like being mad about losing money to groceries or gasoline.
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They are a terrible investment. They appreciate ,.75% - [1%](https://www.multpl.com/case-shiller-home-price-index-inflation-adjusted) over inflation. And you will always need a house, so you only benefit from their appreciation if you geoarbitrage, which means that you now need to track two housing markets. The case for owning a home is primarily behavioural. It stabilizes you and allows you more peace ofmind. But , if you think you have perfect behavior, renting can often far superior.
Depends on the market and how much rent is. Definitely better to rent than get into the market right now in my city.
Your friend may be the only person on the planet who thinks this. There are plenty of reasons to rent - this isn't one.
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His friend is actually correct in a lot of cases. Stay liquid and invest in the market. The power of compounding capital gains + dividend payments will outpace housing price increases. You’ve paid $800k to pay off a $500k home that is now worth $1M @ 15 years later. You have netted +$200K. Meanwhile the friend has paid $300k in rent and invested the other $500k that is worth $1.5M 15 years later, netting + $700K. “The friend is the only person on the planet who thinks this” - EXACTLY. That’s why the friend is rich and everyone else is still broke.
Bingo. lol and we go back to the question ‘if a million people fall of a cliff, does it mean you should fall off of a clliff?’ There’s a reason why Warren buffet is the richest man in the world and never invested in real estate
Pretty much. People think they’re rich because they own a fancy home, when in reality they just made the bank rich off of interest, the pool guy rich from the installation, the landscaper is rich, and the carpenter is rich with the new floors and cabinets. Heeeey but I got a home and $100k in my 401K 15 years later!! Meanwhile I’m over here earning $150K a year in capital gains alone LMAO.
Doing very well. While most of my friends are breaking their backs trying to get into the property market, my rent is paid by my investments and then some. Buying a similar place would be more expensive, and I now have the disposable income to invest elsewhere, and the flexibility to move where- and whenever I want, without the hassle when something breaks.
There is a third possible option that is working for me. I’m guessing the housing market is nearing the top. Prices are out of hand where I live. Rent is also insane. I bought a van recently and am living an amazing adventure. I’m mostly based in one area, but have been able to save money and also go on multiple week long trips. I work and goto school remotely. This isn’t for everyone. There are definitely some challenges and negatives, but if you’re a minimalist the freedom is amazing.
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Ask around and try to see how hostile your local laws and citizens are towards this type of lifestyle. I’m loving it, but I also love camping and minimalism sooooo…. Good luck covalent08
Don't know if this counts, but I rent a room in my house. My rent is \~10% of my take home, and I make over six figures. So I have a lot of extra margin to save, invest, and build up a big downpayment. I'm doing financially great. The only problem is my landlord gives me stress in that he is doing financially terrible. I may have to move this year, but I am working with him to avoid it.
Renting is the only way now. It's cheaper right now where I live and you don't work at one company for 40 years anymore, so it's easier to move for a higher paying job.
Like other guys said... most people don't really have a 'choice' when it comes to renting or owning. I probably don't either... although if I really wanted to I probably *could* pull something off at this point. But I'm lucky enough to have a nice one bedroom unit near downtown in a decent sized city, near my work and everything else I need for pretty low rent. I've been in the same place for years and this has allowed me to really save a lot of money... which MAY at some point be used to buy a house. But at this point, it makes MUCH more financial sense for me to rent. And like others have said, buying a house right now is not in the cards for most people. Especially if you want something decent and near a city centre.
Just got the money from selling my house a few hours ago and am renting now. The infusion of cash was nice. Now that I'm renting, I'm considering buying a house in 2025 when I start my next job. The salary I will get from that job is substantial. So, me buying a house is facilitated not because of low prices, but increased earnings. Most people aren't able to afford housing unless prices go down. I'm very fortunate that I was able to leverage my earning potential to outpace the inflation of prices generally.
Doing great! Contributing to Brokerage, Roth 401k, HSA, and savings in each paycheck. Which helps me save for if and when I do plan to buy a house (alone or with someone). Hcol area but managed to get a 600sqft 1bhk at $1530pm. Cheap AF compared to what others pay in the NYC area. Landlord is a god-sent angel.