House owners VS renters

[crazymcmichael]

if i had to rent, i could seriously rent for 500 dollars gas,electra,water taxes etc included.. I have 0 maintenance that way.. Thats why i suspect in my case it is better to just ''rent'' something out when needed. I am living in a very good neighbourhood here for free but i live in the house of my girlfriend and sometimes i am worried about it although we are 10 years together allready ;p

[dddrees]

Originally Posted by superdog

Not me.

I don’t like the idea of paying someone else’s mortgage.

This and since I no longer have a mortgage my most expensive maintenance year is still much cheaper than paying rent every single month. Much, much cheaper.

Oh, did I fail to mention that means more toys for me.

[Zakalwe]

Where I live it'd cost almost as much to rent as my mortgage costs - and you'd still have to pay the bills on top. Yet instead of that large sum of money going into an appreciating asset (whatever anybody says about bubbles, the long term trend for property in London is simply only going to go up - small island + densely packed population + limited scope for new builds + increasing population) it would be going into a big black hole of nothingness.

It's an absolute no-brainer round my way to own/mortgage rather than rent if you can - but that's the kicker. The reason people don't, other than due to being itinerant, is the obscene deposit requirement. For a typical small-ish family home in my part of London you'd need to pony up about £150k cash minimum just for the privilege of getting a £2k PCM mortgage. It's just beyond most normal people.

[crazymcmichael]

Originally Posted by dddrees

This and since I no longer have a mortgage my most expensive maintenance year is still much cheaper than paying rent every single month. Much, much cheaper.

Oh, did I fail to mention that means more toys for me.

what is your average maintenance a year if i may ask you??

[pickettt]

You’re always buying the house you’re in, the only question is who you’re buying it for; yourself or your landlord.

[The Libertine]

Homeowner as well.

[piratfisk]

Originally Posted by SunTzu

Bingo. Your parents are the norm for retiring couples in NJ. Overtaxed and moving South to a home they built on twice the lot for a fraction of the cost and zilch cost of living. Northeast pensions go a helluva a lot father there. My old man is like yours; the f*ing snow. After 77 years he's over it.

My financial advisor is telling me to go to Charlston, SC to a suburb outside the city. I have no family besides my folks and we have a close relationship, so leaving them would be a concern because I do make sure they're OK. But for now, I'm fine here as much as I'm eyeballing hard, Florida. I'm recently single after a 3.5 year relationship so I have freedom to make moves when the time is right with no other considerations in my life.

No, you clearly haven't learned a thing! Best of luck in San Diego though. Beautiful and gorgeous weather. If you can hack it, more power to you both. My folks are going in May, Hotel del Coronado.

Hotel Del is a nice spot! If they're burrito fans, tell them to check out Clayton's, as well as Don Pancho's. As for the real estate conundrum, we're going to use the VA Home Loan for low interest rates for our condo. We're DINK (dual income, no kids) now, and have barely begun to entertain the idea of adding a 3rd mouth to the household. I don't know if I could deal with not having the security of "my home" if I've got a kid in the mix. My wife & I are very mobile and have rented our entire lives (since post-college years).

[Etschell]

own my house, no mortgage and im relatively young. not a brag just a fact but the smartest thing you can ever do.

[jonnyz1245]

Originally Posted by crazymcmichael

Holy... You kiddin right ? ? 18k taxes..???

Nope. I have two very close friends that live in NJ. One pays approx 30K and the other 25K. Houses are valued at 875 and 1.2. NJ has some of the highest property taxes in the US.

[jonnyz1245]

Originally Posted by crazymcmichael

Guys,

Considering anyone here spends crazy money on watches i was wondering are there any guys that actually don't own a house but rather rent it?
I'd actually would rather rent something than buy something as sonetimes it can be even cheaper on the long run.. Not when you rent something nice offcourse.

Anyone???

I am in real estate and there are a lot of variables to consider. While in most cases it does pay to own your own house vs renting. That is not always the case.

As far as ongoing maint I advise my clients to factor in approx 1% of the value of the home over 10 years for ongoing maintenance. In other words if your house is 500K, think 5k per year over a decade. You may only spend 1k 1 year but in year 5 you need a new roof that cost 15K. Not an exact science but I have found the 1% rule to be fairly accurate .

Feel free to pm me your #, I am happy to fill you in via phone with the various things to consider and why in some markets, it makes no sense to own and in others its the only way to go.

[tudorbaja27]

Originally Posted by jonnyz1245

I am in real estate and there are a lot of variables to consider. While in most cases it does pay to own your own house vs renting. That is not always the case.

As far as ongoing maint I advise my clients to factor in approx 1% of the value of the home over 10 years for ongoing maintenance. In other words if your house is 500K, think 5k per year over a decade. You may only spend 1k 1 year but in year 5 you need a new roof that cost 15K. Not an exact science but I have found the 1% rule to be fairly accurate .

Feel free to pm me your #, I am happy to fill you in via phone with the various things to consider and why in some markets, it makes no sense to own and in others its the only way to go.

Hats off to this gentleman

[ras47]

My neighbors, an older couple, lived their whole lives in NJ and recently moved down to South Carolina. They downsized their house but got a lot more property and found a great neighborhood with a house they adored. The realtor was pacing back and forth, nervous as a long-tailed cat in a room full of rocking chairs. The deal was about to close but the realtor hadn't yet disclosed the property taxes. She was nervous because this particular house had the highest taxes in the neighborhood.

Realtor: "So... the taxes... that's a problem. They're $1800." <winces>
Loraine: "Huh. $1800 a month doesn't sound so terrible."
Realtor: "No, that's $1800 per year. Is that OK?"
Loraine: "Bwahahahahahahaha!! SOLD!!"

[crazymcmichael]

Originally Posted by ras47

My neighbors, an older couple, lived their whole lives in NJ and recently moved down to South Carolina. They downsized their house but got a lot more property and found a great neighborhood with a house they adored. The realtor was pacing back and forth, nervous as a long-tailed cat in a room full of rocking chairs. The deal was about to close but the realtor hadn't yet disclosed the property taxes. She was nervous because this particular house had the highest taxes in the neighborhood.

Realtor: "So... the taxes... that's a problem. They're $1800." <winces>
Loraine: "Huh. $1800 a month doesn't sound so terrible."
Realtor: "No, that's $1800 per year. Is that OK?"
Loraine: "Bwahahahahahahaha!! SOLD!!"

crazy how this can differ there per state...……...

[Danny83]

I sold my house in April of 2016 currently leasing the same home till December. My rent is 6k cheaper then mortgage lol. I will hopefully own again in December

[77T]

Financially, renting will not build capital gains or contribute to your net worth. If you are a good investor you will choose a home that can gain value beyond the costs of finance, maintenance, taxes, etc.

Yes ownership comes with risks. But there are risks in renting, too. You adopt the risks of the owner(s) of the apartment building. Transience also brings some additional risk.

Been a homeowner for over 40 years in several cities and homes.

Sure, investing in equities can bring better returns. But as long as you’ve got to live somewhere - IMHO, it makes sense to reap rewards along the way.




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[spoilsofwar01]

my wife and I purchased our 1st home and worked long and hard to pay the 25 year mortgage off in 18 years, with an endowment still running we bought a 2nd property to rent out (additional pension fund) x2 redundancies and a matured endowment we now own both properties out right.... its not been an easy journey and my 1st tenants were a nightmare but we are now looking to go semi retired within the next 3 years. I'm no financial expert however we've gone without an awful lot over the years so now we are beginning reap the rewards of our labors.

[superdog]

Originally Posted by dddrees

This and since I no longer have a mortgage my most expensive maintenance year is still much cheaper than paying rent every single month. Much, much cheaper.

Oh, did I fail to mention that means more toys for me.

Agree 100%.

I actually have a rental fully paid for too. My renter pays all my home costs, for both homes. It’s glorious.

And way way way more important than toys.

[Blacktocomm]

We rent because we are in our location for the short term (less than 4 years) and the cheapest house in our neighborhood is 1mm for 850sf, but that said I live with a watch/hobby budget that is only $2,500 a year.

That said I am a bit younger than most here (early 30's) and my wife and I drop a fair amount in savings each month (more than a Sub Less than a Nautilus). So do we drive Porsche's and wear Patek's or do we live "cheap" for a while and retire into hobby jobs early.

[Carrera911]

Own +6 and I'm in my mid 30's.
I own my home, I also own 6 rental properties. Hoping to build enough sustainable wealth to not need to work.

[derekhayden]

Originally Posted by Blacktocomm

That said I am a bit younger than most here (early 30's) and my wife and I drop a fair amount in savings each month (more than a Sub Less than a Nautilus). So do we drive Porsche's and wear Patek's or do we live "cheap" for a while and retire into hobby jobs early.

I would say whether you rent or own if your stacking $100K+ a year into savings then you're on a great path for the future.

[Etschell]

Originally Posted by derekhayden

I would say whether you rent or own if your stacking $100K+ a year into watches then you're on a great path for the future.

fyp

[Blacktocomm]

Originally Posted by derekhayden

I would say whether you rent or own if your stacking $100K+ a year into savings then you're on a great path for the future.

Thanks man! Yeah, we feel pretty confident about the future, it is just figuring out where and when we settle down after this little stretch of grind in the corporate world. I've heard Geneva is nice...

[SpeakWithMichael]

Originally Posted by tudorbaja27

Always rented. I do move a lot
Not a fan of creating long-term obligations for myself.

Same. I've done nothing but move around all my life, even as a kid. One year here, two years there, 4 years here... never in one place for more than 4 years it seems. I don't want the headache of being tied to a bank for 15-30 years on a house I may not live anywhere near, and having someone else cause damage to it that I need to pay. I'm not good with that. Also, I've never made much money, and the thought of having to fork out several thousand dollars at any given point for house repairs is not within my realm of financial ability. I'd be a terrified homeowner. I rather rent and move as needed with minimal fuss. My rent is less than most of your car payments (about $400) here in southern Spain. And my dad always advised against it. You spend decades paying off a house that isn't yours until you finish every single last payment to the bank. Then it's yours. If you fall on hard times before then, sometime in those 15-30 years, you're screwed. There goes everything.

[BisonHead]

Rented only when younger in London for a year or so in the early 90's, then bought.

It was hard at the time, although moving forward best thing i did.

Don't live in London anymore and mortgage free on all our properties. Which is nice i must say.

I feel sorry for the younger generations trying to get a foot on the property ladder. i really do.

Meant to say i have been very fortunate.

Renting is very popular in Europe more so than it was in the UK. City dependent of course.

[tudorbaja27]

Originally Posted by SpeakWithMichael

Same. I've done nothing but move around all my life, even as a kid. One year here, two years there, 4 years here... never in one place for more than 4 years it seems. I don't want the headache of being tied to a bank for 15-30 years on a house I may not live anywhere near, and having someone else cause damage to it that I need to pay. I'm not good with that. Also, I've never made much money, and the thought of having to fork out several thousand dollars at any given point for house repairs is not within my realm of financial ability. I'd be a terrified homeowner. I rather rent and move as needed with minimal fuss. My rent is less than most of your car payments (about $400) here in southern Spain. And my dad always advised against it. You spend decades paying off a house that isn't yours until you finish every single last payment to the bank. Then it's yours. If you fall on hard times before then, sometime in those 15-30 years, you're screwed. There goes everything.

Agreed. I believe we are special cases. At my age (under 30) I've already lived in 5 countries. About 10 cities. Don't see myself spending my entire life in the NE.

I like my freedom and thoroughly enjoy moving around. Unless I come up to the point when I can pay cash for something - I usually don't buy it.

I understand the financial implications of both strategies.

YMMV

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[Tmac478]

I've lived in the same house that I purchased 30+ years ago. It's been paid off for many years. Now I just pay taxes, insurance, maintenance and upgrades. I have no car payments and no credit card dept. Most of what I make goes towards investments. I put a small amount each month into a "watch fund" too. It's a great feeling to be free of all that dept.

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[crazymcmichael]

Thats 1 pluspoint of me, i do not have any debts no car loan, no scholarship loan, no mortgage nothing in debts :) Especially at my age(28) thats very good i think.. However i don't own a house so yes))

[SpeakWithMichael]

Originally Posted by BisonHead

I feel sorry for the younger generations trying to get a foot on the property ladder. i really do.

For some of us, like me, the idea of having 20k-40k saved just to put down towards a house payment, is so far gone from the realm of possible, we don't even consider it. Not even happening. The thought isn't even entertained. That life is not our life. I'd have to save for 20 years just to get into a 20-30 year mortgage. Best I can hope for is a Rolex on my wrist to treasure, and I could make that happen with a few years of working hard like I am now, but home ownership? Pffft. Might as well just be happy to rent a comfortable apartment with good neighbors. That's Spain for most of us today. And I have no debts beside a little dental work I'm paying off monthly over the next year. No car, either.

[crazymcmichael]

Originally Posted by SpeakWithMichael

For some of us, like me, the idea of having 20k-40k saved just to put down towards a house payment, is so far gone from the realm of possible, we don't even consider it. Not even happening. The thought isn't even entertained. That life is not our life. I'd have to save for 20 years just to get into a 20-30 year mortgage. Best I can hope for is a Rolex on my wrist to treasure, and I could make that happen with a few years of working hard like I am now, but home ownership? Pffft. Might as well just be happy to rent a comfortable apartment with good neighbors. That's Spain for most of us today. And I have no debts beside a little dental work I'm paying off monthly over the next year. No car, either.

Is the salary very bad in Spain? Just buy a beautifull watch and keep a few Thousand tucked away somewhere than and be happy :) Maybe, it is the easy things in life that makes life beautifull in some cases...

[SpeakWithMichael]

Originally Posted by crazymcmichael

Is the salary very bad in Spain? Just buy a beautifull watch and keep a few Thousand tucked away somewhere than and be happy :) Maybe, it is the easy things in life that makes life beautifull in some cases...

Yes, but the cost of living is also proportionately lower. There's simply not as much margin for saving as other countries. Here you're frugal because you have to be. Elsewhere, being frugal nets you some really nice watch money. It was not this way before the euro replaced the peseta. Things changed.

And yes, your suggestion is the plan.