Rent they said. It’s cheaper they said.

[Conan]

You’re making someone rich lol

I swear some of y'all are remedial.

Your home purchase is making the bank rich.
Your grocery purchases make the supermarket rich.
Your crack purchases make the drug dealer rich.

We live in a society. If you need goods and services, acquiring those will make people rich. If you a simpleton nikka your solution is to become a homestead sharecropper so you can brag "I don't call no one daddy".

But most sensible people realize... It's not about what goes out. It's about your net worth at the end of the day. If your net worth is going up, who gives a fukk about ownership? Unless your sense of worth and manhood is tied to how big your whip is or whether you "own" a home

 

[AAKing23]

Record Inflation will screw homeowners the same as renters. Because they'll be less buyers that can afford these overvalued homes on the market. Nobody really wins during a huge inflationary cycle.

Exactly

 

[1thouwow]

I am making the argument that

1. There is a significant amount that needs to be dumped into a home purchase (down payment)

2. There are unrecoverable costs involved with home ownership (closing costs, property taxes, home maintenance, mortgage interest, additional utilities, etc)

3. There is an opportunity cost involved with the down payment/unrecoverable costs: what are you foregoing by making a home purchase. The stock market is readily accessible so that is the reference point.

4. Here is the key point. Depending on home prices, rental prices (and again I have to emphasize, there is a weak link between the two, as rent is driven by rental property supply/demand) in the area, you can come out ahead if you invest your down payment and unrecoverable costs in the stock market instead and continue to rent.

5. Sometimes the homeowner will come out ahead. Sometimes the renter will come out ahead. It is rarely clear cut in either direction.

I am not arguing rent is always better than buy. I'm pushing against those who try and justify their own anecdotal purchases with the line, buy > rent. It is sometimes not the case. Only an idiot would be so absolute on this. And there are a lot of idiots on this topic. Just Google rent vs buy calculator if you think the answer is always buy

I’m still waiting on your portfolio .

 

[Turbulent]

I'll repeat this as many times as needs to be said.

As an owner, your options are:

• Pay your own mortgage; earn equity, receive tax deductions and long-standing credit history and a marvelous hedge against inflation.
• Rent it out and let someone else pay your mortgage; earn equity, receive tax deductions and long-standing credit history and a marvelous hedge against inflation.
• Sell the home and cash in on your equity.
• Pass the property down to your progeny.

As a renter, your options are:

• Pay someone else's mortgage and the rising cost of inflation.

Or, pay someone else's mortgage, invest the cash you save in taxes, maintenance, and reduce home expense in an index fund, and enjoy having a relatively more liquid asset that may rival the value of the home that you would have bought without having to deal with maintenance or tenants.

 

[tuckgod]

"if your broke in the modern world, its your own fault"

Yes.

This thread is full of supposedly college educated people that continually show they don’t know the difference between mode, mean, and median so that tells me they’re lying or didn’t grasp the most basic concepts in statistics class.

Its a requirement for all college students for a very good reason.

Here’s some help.

Statistics and Averages: How Numbers Can Mislead

The average is the most common form of statistical presentation; and averages can be extremely misleading.

www.wondriumdaily.com

 

[Conan]

Or, pay someone else's mortgage, invest the cash you save in taxes, maintenance, and reduce home expense in an index fund, and enjoy having a relatively more liquid asset that may rival the value of the home that you would have bought without having to deal with maintenance or tenants.

Opportunity cost is one of the basics of economics and it's no wonder that proponents of hotep economics ignore those basics or just can't understand them

 

[Sad Bunny]

Plus taxes after it’s “paid “ you’ll lose is it regardless

Properly taxes are much lower than rent. Y’all throw property taxes out there like they’re thousands per month

 

[Sad Bunny]

I know but I just don't want to pay PMI on top of the mortgage

You can pre-pay the PMI. And if your value increases you can drop the PMI. I didn’t put down 20% but I have no PMI.

 

[Sad Bunny]

How much would monthly mortgage payments+taxes+maintenance be in those same exact same cities? Then take the difference and put it in an index fund for 30 years. Then compare that to the appreciation you got on your home. I think you might come ahead by owning a home but not by that much.

Why can’t we do both?

I invest and own a home. My kids will never have to pay rent unless they choose to.

 

[Sad Bunny]

I'll repeat this as many times as needs to be said.

As an owner, your options are:

• Pay your own mortgage; earn equity, receive tax deductions and long-standing credit history and a marvelous hedge against inflation.
• Rent it out and let someone else pay your mortgage; earn equity, receive tax deductions and long-standing credit history and a marvelous hedge against inflation.
• Sell the home and cash in on your equity.
• Pass the property down to your progeny.

As a renter, your options are:

• Pay someone else's mortgage and the rising cost of inflation.

This lol

 

[Jekyll]

Or, pay someone else's mortgage, invest the cash you save in taxes, maintenance, and reduce home expense in an index fund, and enjoy having a relatively more liquid asset that may rival the value of the home that you would have bought without having to deal with maintenance or tenants.

Imma be real. If taxes and maintenance costs are a big enough blow to your pocket that that saving them helps you in a big way then you probably couldn’t afford the property in the first place.

Like my yearly weed bill is bigger than what I pay in property taxes. My monthly auto deposit into my brokerage is bigger than what I pay yearly in property taxes. This is not the point that you think it is lmao.

I swear some of y'all are remedial.

Your home purchase is making the bank rich.
Your grocery purchases make the supermarket rich.
Your crack purchases make the drug dealer rich.

We live in a society. If you need goods and services, acquiring those will make people rich. If you a simpleton nikka your solution is to become a homestead sharecropper so you can brag "I don't call no one daddy".

But most sensible people realize... It's not about what goes out. It's about your net worth at the end of the day. If your net worth is going up, who gives a fukk about ownership? Unless your sense of worth and manhood is tied to how big your whip is or whether you "own" a home

The bank at most will collect 2.6% of what I paid for my spot. If I sold the property that I’ve had for less than a year today I would have an estimated $120k net proceeds. And everything in my zip code is cash offers above asking or bust.

Keep justifying paying rent though. I’m sure the 2-3k you save in taxes will take you far in life.

 

[Sad Bunny]

Someone else who doesn't understand opportunity cost.

As a renter, all that money you put on the down payment, PMI, home maintenance, property tax, mortgage interest, additional utility bills (like trash and sewer) can instead be put in the market, which has a higher earning rate than real estate appreciation.

As a renter you're paying for housing. As a home owner you are paying for housing. What matters is how far ahead you are at the end of the day in terms of net worth. And there are many situations where homeowners end up worse than renters.

Homeowners have higher net worth than renters.

“2020 by the Federal Reserve, found the median U.S. household net worth is $121,700. However, the difference between the net worth of homeowners versus renters is staggering. In 2019, homeowners in the U.S. had a median net worth of $255,000, while renters had a net worth of just $6,300.”

Here's the average net worth of homeowners and renters

There is a stark difference in average net worth of homeowners versus renters in the U.S. Here's what you need to know.

www.cnbc.com

 

[Conan]

Properly taxes are much lower than rent. Y’all throw property taxes out there like they’re thousands per month

Property tax on a 400k property in NJ can hit $1500 per month. Then there's still mortgage interest charges especially early on in the plan. Maintenance, utilities... You can absolutely be over a typical rent payment

Unrecoverable costs usually are not much lower than rent. But you never sat down and did the math, so of course you think it's much lower...

Lack of knowledge is a mofo...

 

[Turbulent]

Opportunity cost is one of the basics of economics and it's no wonder that proponents of hotep economics ignore those basics or just can't understand them

Word. And I'm not necessarily against homeownership or pro renting. To me it depends on the market where you buy, the stage you are at in your life, the amount of space you need, if you move a lot or if you like to plant roots, number of kids, if you work from home or on site, etc, etc. Money is only one dimension of the issue.the time and energy you invest in a home is an important factor that affects your freedom. On the other hand, knowing you can do whatever you want to your home renovations wise and having space/privacy is also an aspect of freedom. It's not one size fits all...

 

[Sad Bunny]

I am making the argument that

1. There is a significant amount that needs to be dumped into a home purchase (down payment)

2. There are unrecoverable costs involved with home ownership (closing costs, property taxes, home maintenance, mortgage interest, additional utilities, etc)

3. There is an opportunity cost involved with the down payment/unrecoverable costs: what are you foregoing by making a home purchase. The stock market is readily accessible so that is the reference point.

4. Here is the key point. Depending on home prices, rental prices (and again I have to emphasize, there is a weak link between the two, as rent is driven by rental property supply/demand) in the area, you can come out ahead if you invest your down payment and unrecoverable costs in the stock market instead and continue to rent.

5. Sometimes the homeowner will come out ahead. Sometimes the renter will come out ahead. It is rarely clear cut in either direction.

I am not arguing rent is always better than buy. I'm pushing against those who try and justify their own anecdotal purchases with the line, buy > rent. It is sometimes not the case. Only an idiot would be so absolute on this. And there are a lot of idiots on this topic. Just Google rent vs buy calculator if you think the answer is always buy

Down payment isn’t even all that bad. 3 to 5% is all that is needed. 300K house = 9K to 15K down.

That’s not a lot. nikkas probably spend that fast food a year