Rent Forever, Don’t Buy A Home

[lazyj10]

^ thank you.

"All profit" is a misnomar. Look at your amortization schedule in your loan docs. I don't care what percent you're paying, you're still continuously paying (I.E. increasing the cost) interest and a ton more. You're hopes to recoup the principal but you wont even be making a dent in recouping the total outlay.

For instance 240k @ 4.4 over 30 yrs would tack on $197k. Your total outlay is now 437k. Youd have to sell over that threshold for "all profit" so to speak and that's without including prop taxes.

That's where rent versus buy decisions come in plus other intangibles.

My friend who does this is in and out within 3-mo's (or whenever the FHA restriction is lifted). He's got his real estate license so makes money on the front and back ends. Now he has an investor so overhead is decreasing and if it sits longer than he'd like the meter isn't running on a mortgage too.

 

[lazyj10]

^ thank you.

"All profit" is a misnomar. Look at your amortization schedule in your loan docs. I don't care what percent you're paying, you're still continuously paying (I.E. increasing the cost) interest and a ton more. You're hopes to recoup the principal but you wont even be making a dent in recouping the total outlay.

For instance 240k @ 4.4 over 30 yrs would tack on $197k. Your total outlay is now 437k. Youd have to sell over that threshold for "all profit" so to speak and that's without including prop taxes.

That's where rent versus buy decisions come in plus other intangibles.

My friend who does this is in and out within 3-mo's (or whenever the FHA restriction is lifted). He's got his real estate license so makes money on the front and back ends. Now he has an investor so overhead is decreasing and if it sits longer than he'd like the meter isn't running on a mortgage too.

 

[thunderchunk69]

^well I do agree on the 'not until I'm married' argument!

 

[thunderchunk69]

^well I do agree on the 'not until I'm married' argument!

 

[hollywood james 6]

I want my own house so I can tell people to get the %%%! off my lawn.

Family room / entertainment room

I don't see why anyone wouldn't want their own home that can afford one. I can understand bigger cities where space is limited for location... However if you buy something in your budget, it's YOURS.

 

[hollywood james 6]

I want my own house so I can tell people to get the %%%! off my lawn.

Family room / entertainment room

I don't see why anyone wouldn't want their own home that can afford one. I can understand bigger cities where space is limited for location... However if you buy something in your budget, it's YOURS.

 

[tcerda]

Originally Posted by Supermanblue79

Originally Posted by TCERDA

Avg rent in San Antonio, TX is prolly around $700. I bought a 3 bedroom home for 60 grand. Spent another 10 grand remodeling (Pops and I did the work ourselves) Mortgage is 557.00 a month including property taxes and home insurance. FTW!

  Now I will at least have something to give my 2 boys when Im gone.

Amazing!
I've been hearing that Texas is amazing as far as cost of living goes. 

Yea bro Im blessed. Dont live in a Mansion but only about 1300 Square foot home but its nice with a nice yard and trees. Is an older home but with a little elbow grease, its where I want it to be now.  Cant really complain!

  

 

[tcerda]

Originally Posted by Supermanblue79

Originally Posted by TCERDA

Avg rent in San Antonio, TX is prolly around $700. I bought a 3 bedroom home for 60 grand. Spent another 10 grand remodeling (Pops and I did the work ourselves) Mortgage is 557.00 a month including property taxes and home insurance. FTW!

  Now I will at least have something to give my 2 boys when Im gone.

Amazing!
I've been hearing that Texas is amazing as far as cost of living goes. 

Yea bro Im blessed. Dont live in a Mansion but only about 1300 Square foot home but its nice with a nice yard and trees. Is an older home but with a little elbow grease, its where I want it to be now.  Cant really complain!

  

 

[crazy dav0]

Originally Posted by UnbornSeed

Originally Posted by jordanhendrix

Originally Posted by tim teufel

my mom bought a 2 fam in woodhaven queens for 218k back in 97 mortgage is fully paid off today and even in these tough times the house is worth at least 550. in its prime it was worth 800k. the houses and forclosures today will allow a buyer a great deal if they jump on it.you can never convince me that renting is better than owning if you are a smart individual. i have been in the mortgage bizz for over ten years so i know whats up. 

renting is never "better" than owning, the idea is that what you can do with the extra money from renting cheap.....IE invest it in better vehicles.....your in the mortgage industry you know that there are other investments right? What the hell is so hard to understand. Yes having a tangible asset is better than not, I'm not saying rent forever....rent until you can buy a house in cash. Rent so you can put that money to better work than a house....damn you dense sometimes
217k to 550k is a 333k profit in ~14 years....it took your mom ~14 years to see a 153% return.....could have made more somewhere else....its 11% per year return. And NYC is a GREAT market.....so that 11% is no where near most areas. Get IT?

I know you wont care about the following: I am up 169% on one stock THIS YEAR, that 4 months. Any "smart individual" would ask you to look up the term opportunity cost.

You are not a "smart individual" by any means.

if someone has posted this already then my fault for the repost ... just started reading this from page 1 and i'm not trying to act like a know it all

i'll leave you to figure out who is smart and who isn't

based on the talk of investing and putting your money to work. if i had $217K and it went up to 550K i would not be saying it earned 11% per year ... COMPOUNDING IS KEY ... would have supported jordan's arugment a lot better imo and that is what i expected to see based on what he says he does as he stated he was comparing home ownership to renting and putting the money elsewhere

the annual return is approximately 6.87% ... check it by doing 1.067^14 x 217 ... should  = $550K. But it's not just about the return ... like dirty stated ... part of it is owning your own home and the joy that comes from that. knowing that you will eventually own it, having land, home improvement projects. You can't place a "value" on certain things that a home provides. if you are treating your home (the one you will live in) as the focal point of your investment strategy then i would be on the side that says i wouldn't do that. However, if you want a home and can afford it and you want to enjoy what that brings while also having a chance for that asset to increase in value is a bonus.

House prices, stock prices, etc. may go up and down ... don't go buying one just to buy one but at the same time i can't fault anyone for wanting to buy a home when they are good and ready and paying a mortgage vs. continuing to rent and later buying a home.

Do what works for you based on your circumstances. Just make an informed decision as you should with anything you spend your money on.

 

[crazy dav0]

Originally Posted by UnbornSeed

Originally Posted by jordanhendrix

Originally Posted by tim teufel

my mom bought a 2 fam in woodhaven queens for 218k back in 97 mortgage is fully paid off today and even in these tough times the house is worth at least 550. in its prime it was worth 800k. the houses and forclosures today will allow a buyer a great deal if they jump on it.you can never convince me that renting is better than owning if you are a smart individual. i have been in the mortgage bizz for over ten years so i know whats up. 

renting is never "better" than owning, the idea is that what you can do with the extra money from renting cheap.....IE invest it in better vehicles.....your in the mortgage industry you know that there are other investments right? What the hell is so hard to understand. Yes having a tangible asset is better than not, I'm not saying rent forever....rent until you can buy a house in cash. Rent so you can put that money to better work than a house....damn you dense sometimes
217k to 550k is a 333k profit in ~14 years....it took your mom ~14 years to see a 153% return.....could have made more somewhere else....its 11% per year return. And NYC is a GREAT market.....so that 11% is no where near most areas. Get IT?

I know you wont care about the following: I am up 169% on one stock THIS YEAR, that 4 months. Any "smart individual" would ask you to look up the term opportunity cost.

You are not a "smart individual" by any means.

if someone has posted this already then my fault for the repost ... just started reading this from page 1 and i'm not trying to act like a know it all

i'll leave you to figure out who is smart and who isn't

based on the talk of investing and putting your money to work. if i had $217K and it went up to 550K i would not be saying it earned 11% per year ... COMPOUNDING IS KEY ... would have supported jordan's arugment a lot better imo and that is what i expected to see based on what he says he does as he stated he was comparing home ownership to renting and putting the money elsewhere

the annual return is approximately 6.87% ... check it by doing 1.067^14 x 217 ... should  = $550K. But it's not just about the return ... like dirty stated ... part of it is owning your own home and the joy that comes from that. knowing that you will eventually own it, having land, home improvement projects. You can't place a "value" on certain things that a home provides. if you are treating your home (the one you will live in) as the focal point of your investment strategy then i would be on the side that says i wouldn't do that. However, if you want a home and can afford it and you want to enjoy what that brings while also having a chance for that asset to increase in value is a bonus.

House prices, stock prices, etc. may go up and down ... don't go buying one just to buy one but at the same time i can't fault anyone for wanting to buy a home when they are good and ready and paying a mortgage vs. continuing to rent and later buying a home.

Do what works for you based on your circumstances. Just make an informed decision as you should with anything you spend your money on.

 

[hombrelobo]

Originally Posted by wawaweewa

Kind of fitting for this thread:
http://market-ticker.org/akcs-www?post=184512

http://market-ticker.org/akcs-www?post=184512
http://market-ticker.org/akcs-www?post=184512
http://market-ticker.org/akcs-www?post=184512Did The Realtors Screw You?
 

1. Zillow is highly inaccurate.
2. Any SMART buyer/Realtor would know market conditions. Even in this case if the home initially depreciates the market is eventually going to change. Are you trying to imply that the RE market is never going to go back up? Right..
3.This article doesn't even mention what market this is from. Association president? Which Association? A HOA?
4. This article is poorly written.

 

C'mon, dude. I get it. It's not a good time to buy in Richtown, USA. But that doesn't mean it isn't a good time to buy somewhere else.

P.S. We've all come to the agreement that buying isn't for everyone. But for others it is.. right?

Spoiler

Spoiler

Spoiler [+]

Spoiler

Someone is still going to have to buy property for others to rent. I'm just going to say that again. Even in Richtown, USA.

 

[hombrelobo]

Originally Posted by wawaweewa

Kind of fitting for this thread:
http://market-ticker.org/akcs-www?post=184512

http://market-ticker.org/akcs-www?post=184512
http://market-ticker.org/akcs-www?post=184512
http://market-ticker.org/akcs-www?post=184512Did The Realtors Screw You?
 

1. Zillow is highly inaccurate.
2. Any SMART buyer/Realtor would know market conditions. Even in this case if the home initially depreciates the market is eventually going to change. Are you trying to imply that the RE market is never going to go back up? Right..
3.This article doesn't even mention what market this is from. Association president? Which Association? A HOA?
4. This article is poorly written.

 

C'mon, dude. I get it. It's not a good time to buy in Richtown, USA. But that doesn't mean it isn't a good time to buy somewhere else.

P.S. We've all come to the agreement that buying isn't for everyone. But for others it is.. right?

Spoiler

Spoiler

Spoiler [+]

Spoiler

Someone is still going to have to buy property for others to rent. I'm just going to say that again. Even in Richtown, USA.

 

[Shanegerous]

his thread is very informative. I always thought that owning was the best choice and I will eventually own, but this makes me feel better about paying rent. 

 

[Shanegerous]

his thread is very informative. I always thought that owning was the best choice and I will eventually own, but this makes me feel better about paying rent. 

 

[kwh3]

I was never a fan of paying someone else's mortgage.

 

[kwh3]

I was never a fan of paying someone else's mortgage.

 

[wr]

Originally Posted by wawaweewa

Originally Posted by Mr718

Originally Posted by wawaweewa

1200 monthly on a 30 year is about a 175k loan? 
If you have a 400k loan that 200/month will not shave off 15 years. I feel like I'm talking to %#!$%#% trees.

$200/mo for 360 months (30yrs) = $72,000.  Might not cut you in half but definitely wouldn't hurt.

Adding .01 to a monthly payment wouldn't hurt. 
If someone has a 400k 30 year loan at 6%, do they have $500 extra a month laying around solely for extra payments? Some do, most will not. Adding $500 extra on a 2400 monthly will shave off about 11 years. 

Adding 200 extra on a 1200 monthly will shave off about 9 years. 

My parents paid off their house in 10 years but that's with paying off principal in 15k chunks every 6 months the last 2-3 years. 

If one doesn't have that much extra money sitting around to handle the extra payment then honestly home ownership is out of your league. Most people in the US have this attitude where if you have enough money for the bare minimum then you're ok to go when in all actually, you financial situation can be summed up by the person only being at the most 2 weeks away from a complete financial meltdown. If you are serious about home ownership, you should be set up in a way where you are at least 5 months or more away from collapse. I think i read in some thread on NT about an Asian tradition of paying bills(or having the money set aside) one year in advance. That's some of the best advice financial advice I've ever heard. 

 

[wr]

Originally Posted by wawaweewa

Originally Posted by Mr718

Originally Posted by wawaweewa

1200 monthly on a 30 year is about a 175k loan? 
If you have a 400k loan that 200/month will not shave off 15 years. I feel like I'm talking to %#!$%#% trees.

$200/mo for 360 months (30yrs) = $72,000.  Might not cut you in half but definitely wouldn't hurt.

Adding .01 to a monthly payment wouldn't hurt. 
If someone has a 400k 30 year loan at 6%, do they have $500 extra a month laying around solely for extra payments? Some do, most will not. Adding $500 extra on a 2400 monthly will shave off about 11 years. 

Adding 200 extra on a 1200 monthly will shave off about 9 years. 

My parents paid off their house in 10 years but that's with paying off principal in 15k chunks every 6 months the last 2-3 years. 

If one doesn't have that much extra money sitting around to handle the extra payment then honestly home ownership is out of your league. Most people in the US have this attitude where if you have enough money for the bare minimum then you're ok to go when in all actually, you financial situation can be summed up by the person only being at the most 2 weeks away from a complete financial meltdown. If you are serious about home ownership, you should be set up in a way where you are at least 5 months or more away from collapse. I think i read in some thread on NT about an Asian tradition of paying bills(or having the money set aside) one year in advance. That's some of the best advice financial advice I've ever heard. 

 

[hombrelobo]

^I believe most banks are requiring home buyers have at least 5 months or so of reserves prior to purchase.

 

[hombrelobo]

^I believe most banks are requiring home buyers have at least 5 months or so of reserves prior to purchase.

 

[wr]

Originally Posted by hombrelobo

^I believe most banks are requiring home buyers have at least 5 months or so of reserves prior to purchase.

That's quite the contrast from the days where all you needed to get a loan was to "state how much you make" with 0 documentation needed. These were the titles on the loan packets I used to see when I worked in the industry. 

 

[wr]

Originally Posted by hombrelobo

^I believe most banks are requiring home buyers have at least 5 months or so of reserves prior to purchase.

That's quite the contrast from the days where all you needed to get a loan was to "state how much you make" with 0 documentation needed. These were the titles on the loan packets I used to see when I worked in the industry. 

 

[throwback1718]

posting for later

 

[throwback1718]

posting for later

 

[wawaweewa]

Originally Posted by hombrelobo

Originally Posted by wawaweewa

Kind of fitting for this thread:
http://market-ticker.org/akcs-www?post=184512

http://market-ticker.org/akcs-www?post=184512
http://market-ticker.org/akcs-www?post=184512
http://market-ticker.org/akcs-www?post=184512Did The Realtors Screw You?
 

1. Zillow is highly inaccurate.
2. Any SMART buyer/Realtor would know market conditions. Even in this case if the home initially depreciates the market is eventually going to change. Are you trying to imply that the RE market is never going to go back up? Right..
3.This article doesn't even mention what market this is from. Association president? Which Association? A HOA?
4. This article is poorly written.

 

C'mon, dude. I get it. It's not a good time to buy in Richtown, USA. But that doesn't mean it isn't a good time to buy somewhere else.

P.S. We've all come to the agreement that buying isn't for everyone. But for others it is.. right?

Spoiler

Spoiler

Spoiler [+]

Spoiler

Someone is still going to have to buy property for others to rent. I'm just going to say that again. Even in Richtown, USA.

I agree about buying to rent. I've said the same before. We're talking bout buying to own to here though.  Buying to rent is a business decision. Buying to own is not.
Most buyer's aren't in it for the business aspect and therefore not "smart" in the sense of doing thorough due diligence. 

The dude's market in the article is FL. He's made more money than the both of us combined (he sold off MCSnet to Winstar before the tech bubble popped and now trades full time) and he's usually spot on on things. The fact that the tax credit pulled demand forward sounds pretty spot on.