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Explain how renting is better than buying if rent and mortgage/taxes = same
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Date: April 22nd, 2018 5:59 PM Author: well-lubricated ivory selfie If I rent a place for $2000/mo, and I have the option of purchasing a home for $2000/mo (30 year 4.5% mortgage for $350,000 home and including taxes), why would this not be wise to do?
The $2000 to rent I will never see again. The $2000 into the home, at least 3/4 of that goes into my purchase of the home.
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Date: April 22nd, 2018 6:08 PM Author: well-lubricated ivory selfie (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35895657) |
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Date: April 22nd, 2018 6:10 PM Author: stimulating nibblets hall (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35895670) |
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Date: April 22nd, 2018 6:11 PM Author: Odious New Version Friendly Grandma depends on what return you get on your down payment vs what you would get in the stock market and also interest expense tax savings (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35895675) |
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Date: April 22nd, 2018 6:12 PM Author: Pearly Public Bath (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35895687) |
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Date: April 22nd, 2018 6:19 PM Author: well-lubricated ivory selfie the first is kind of a wash because i have no idea what is going to happen to the stock market next year. generally it has gone up at an 8% rate over a long term period but will that continue.
on the second point do you just mean tax deductible interest |
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Date: April 22nd, 2018 6:16 PM Author: aphrodisiac embarrassed to the bone international law enforcement agency additional costs in maintaining a home though i generally agree especially because rent is usually going to be higher than a mortgage on a similar place. (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35895702) |
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Date: April 22nd, 2018 6:19 PM Author: well-lubricated ivory selfie i am looking at these places where the rent i am paying could actually buy a nice condo or townhouse (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35895715) |
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Date: April 22nd, 2018 6:26 PM Author: Brindle Round Eye Haunted Graveyard I told my sister how much in rent I had been paying in Seattle (23% greater than the national average) she was flabbergasted and replied, "That's more than my MORTGAGE!" I would think you should buy, not rent. |
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Date: April 22nd, 2018 6:37 PM Author: well-lubricated ivory selfie How much is your rent in seattle
thats another thing - being locked in at a "rent" i'd be paying 25 years from now would be nice, rather than having to pay something 3x what i'd be paying down the road |
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Date: April 22nd, 2018 10:48 PM Author: well-lubricated ivory selfie (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897417) |
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Date: April 22nd, 2018 10:50 PM Author: Hyperactive cruise ship no idea but FUCK KIKES (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897428) |
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Date: April 22nd, 2018 10:49 PM Author: copper domesticated macaca Owning a home is risky. (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897424) |
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Date: April 22nd, 2018 11:03 PM Author: Onyx Internal Respiration Kitchen ITT: people who don't live in NYC (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897506) |
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Date: April 22nd, 2018 11:10 PM Author: internet-worthy sienna dingle berry lulzy observation (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897546) |
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Date: April 22nd, 2018 11:07 PM Author: adulterous corner There's a lot of upkeep in maintaining a home, and you're forgetting purchase/closing costs. Owning a home is great if you buy a decent house in a neighborhood you'll stay in for 5+ years but the math isn't as simple as you think. (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897536) |
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Date: April 22nd, 2018 11:09 PM Author: Passionate stag film regret Its expensive to buy and sell homes. Transaction costs can be significant.
But you're right that you're much better off buying than renting in much of the country. Most of us just don't live in those places. |
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Date: April 22nd, 2018 11:12 PM Author: well-lubricated ivory selfie I live in a big metro. I think it makes sense to lock in rent 20 years down the road. I have no plans to move. How much are transaction costs (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35897559) |
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Date: April 23rd, 2018 4:14 AM Author: talking comical partner 2% to 5% to purchase.
6%+ to sell. |
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Date: April 23rd, 2018 4:12 AM Author: talking comical partner Issues:
- Opportunity cost of down payment.
- Maintenance and insurance costs.
- Significant transaction costs. |
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Date: April 23rd, 2018 5:13 AM Author: Nubile old irish cottage (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35898666) |
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Date: April 23rd, 2018 4:56 AM Author: wine shitlib station Already op talking about 'mortgage' makes this thread go wrong. (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35898661) |
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Date: April 23rd, 2018 4:57 AM Author: adventurous piazza (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35898662) |
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Date: April 23rd, 2018 5:14 AM Author: Onyx Internal Respiration Kitchen my rent: 2400/month
mortgage for a place in my neighborhood: 3500/month minimum, plus taxes, plus every other fucking thing |
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Date: April 23rd, 2018 2:30 PM Author: effete big parlour but you have to actually save and invest the difference. One aspect about mortgages that seems overlooked on xo is that it's forced savings for low impulse control proles (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35901684) |
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Date: April 23rd, 2018 2:41 PM Author: multi-colored foreskin hospital cr (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35901792) |
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Date: April 23rd, 2018 2:18 PM Author: wine shitlib station interest payment part of mortgage - tax credits + property tax + local fees + transaction costs annualised + maintenance + increase in value - decrease in value
vs
rent |
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Date: April 23rd, 2018 2:20 PM Author: outnumbered doctorate it's mostly just being tied down the location and becoming more illiquid. otherwise yeah, rent is always a 100% negative return while owning is usually positive. (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35901596) |
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Date: April 23rd, 2018 2:24 PM Author: Magical lascivious meetinghouse lettuce also, your rent keeps going up.
otoh, your 30 year fixed mortgage stays the same for 30 years. |
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Date: April 23rd, 2018 2:28 PM Author: charcoal provocative telephone Property taxes will go up tho unless you live in CA where they’re mostly flat (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35901670) |
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Date: April 23rd, 2018 2:32 PM Author: elite native brethren For the first 20 years on a 30-yr mortgage most of your payment goes towards interest (http://www.autoadmit.com/thread.php?thread_id=3956707&forum_id=2#35901702) |
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Date: April 23rd, 2018 2:37 PM Author: Clear Hell If all monthly costs are the same (accounting for down payment, opportunity costs, etc), owning has the benefits of building equity.
That's about it. The calculation can obviously be complicated and is speculative once you get into housing prices/rents/taxes changing.
Imho if you can buy for about what you're paying in rent and make significant equity each month and won't be leaving quickly enough that transaction costs will pwn you, it's worth looking for something. |