O/T Worthwhile buying a house in america or keep renting?

[jm425]

buy a condo. at least you won't have to do the maintenance or repairs.

I bought a house in 2004- a year before the peak. I am looking to buy another house next year sometime if I can sell this hunk of junk I have now.

Speak for yourself. I have to pay for all the repairs and maintenance for my condo. The cheap bastards at HOA only pay for some outside maintenance. On a positive note, I bought my place after the housing market crashed and it's gone up in value by 40k.

 

[j4ever]

it probably depends greatly on your local market, but for me personally I have never paid rent, for me it is a waste, use your common sense when you buy.

 

[builtbeast]

Feds are stupid so who knows what they will do. There's a recent surge again in the housing market where speculative buyers/investors are hoping to flip houses again. Seems like the feds decided to raise interest rates to dissuade another bubble and keep prices where they are. Generally, as interest rate go up housing prices go down. As stated a large number of people are upside down so if the feds raise rates again and these people's homes depreciate further they may say fuck it and default on their mortgage. Then we have another crisis on our hands.

That said, I have a condo and dealing with the HOA sucks. Every 5-7 years they want to paint the complex and the owners have to foot the bill, $3600 last time. It's BS like that that will make me sell it. And if it's only 10-15% more to buy than rent then I would do it. The increase is offset by the interest being tax deductible so it's cheaper for me to buy than rent. Plus you'll build equity which you'll never do with renting. And I honestly don't see home prices falling further as it will cause another housing collapse.

 

[ldog40]

does that differ from co-ops rules? I had a co-op in new york and they fixed my broken toilet and sink.

Yes. they are different, because a co-op and a condo are different. As a condo owner, you own what is "inside" your walls. Co-op owners own a portion of the building and the grounds as a whole. In other words, if your co-op has 6 units, you own 1/6 of the building. Having never owned a co-op, I am not sure if the co-op handling maintenance issues within your particular unit is normal or unique.

 

[ldog40]

I turned 30 recently and most people I know have been telling me that I should buy a house or condo at this point. Im not the most handy guy out there and I have always rented. What I love so far about renting is that if anything breaks they come to fix it and I never have to spend a penny on renovating anything. For a guy who doesnt have a family and cant fix anything himself is it a good idea to buy a small condo for around 100k or keep renting for 700/month?

Do whatever you think is best. There is no pat right or wrong answer, because everyone's situation is different. I've rented, owned a condo and owned a house. They each have their fair share of headaches and the people on here giving you advice are basing it on either their own particular experience and more often than not what someone else has told them. (The financial equivalent of broscience). Your situation isn't theirs because they aren't you, no matter how much they THINK they know what is best for you or THINK they can relate to your experience. If you're fine with renting and you like the freedom it gives you from worrying about maintenance, I see no reason to change that.

 

[alaski]

buy

If you can afford it and get the right terms, then buy. In many places the mortgage is less than paying rent. If you buy, be sure you do your research of home values and the market.

Here California houses are going up very quickly because inventory is really low. This has to do with many homeowners are stuck in an upside down home while others remain vacant as bank owned, leaving not many homes on market for the demand. I don't know what that means for the long term but based on history buying has been good idea.

I'm not one for conspiracies or dooms day predictions as a guide to investing. I believe looking at historical trends has always been the best indicator. Dooms day predictions have always been around from the inception of man, not a good predictor.

 

[musclechaos]

Reasons to buy a house:

1. You see yourself staying in the southern Florida area for a long time.

2. You have a stable job and plan to stay at your company for a long time.

3. You see yourself wanting to have a family in the future.

No one on this board knows what will happen to the housing market and economy in the future. Don't base your decision on these factors.

Other factors that are still in the air are interest rates, will you ever see them this low again? Yes you can currently write off your interest but there was/is talk of taking that away.

You can still find a bank that will let you put down less than 20% if you have good credit.
Most banks have went to the 20% down rule as there was talk of in 2014 under Dodd-Frank Act making it a requirement. Harder to buy a house, rent will go up.

Ask yourself if you rent will you be stuck there. Can I rent and still save money to buy.

 

[MaineGuy]

Holding off just to play the market is a personal choice, just like playing the market in stocks. Make NO mistake though, it has been shown the people that have accumolated the most wealth in America are home owners. This cannot be disputed.

 

[maldorf]

Buy only if you know you will be living there at least 10 years or more before you need or want to move. If you have a stable job that you love and are happy where you are then it might be a good idea. Rates are never going to be this low again and home values are on the rebound up now. Hard to say what will happen to home values though, but I don't think they can drop a whole lot lower than they are now.

If you buy a home now but end up selling it within the next 5 yrs it could be a losing proposition for you.l

 

[upeccmi]

I'm sure I am going to get backlash for my post but I need to.
I have to say, I have read the most uneducated posts on here about the housing on a roid board. As a finance person, there is no best investment than buying a home. The only time I would suggest waiting and renting is if you most likely will not stay in the area for long (less than 2 years). I purchased a two bedroom condo in my 20's as a pre-contruction in 1995 for $121K, at the height of the market boom it was worth $360K, it is now selling for around $285K here in NJ, I am renting it out right now at $1775 (which is actually low rent) and pocketing $516 per month as well as another $440 that they are paying towards my mortgage principle. So I am actually pocketing close to $1K monthly. Anyone who had a clue in 2007 at least should have known we were in a bubble, when the market heats up like it did and so much speculation on prices are given, houses getting bid up and huge price wars should be a red flag to anyone....remember the internet bubble in 2000, as a marketeer I do, sold into that bubble as well.
I did purchase a new home in March 2012 at a great price with no competition for bidding. I have already see an appreciation in my new home of over $50K in a 1 1/2 years. I can also rent this home out as well (per my real estate) for another $425 per month on top of the mortgage principle. I also get to deduct my real estate taxes and mortgage interest on both homes on my taxes.
Point being, you have no equity being built on renting nor can you deduct anything at year end and in 20 years you will still have nothing and your rent will be much higher than today's dollars. Save up, put a good down payment and do not over extend yourself, make sure you can afford your new home.

 

[waterscholar]

I'm sure I am going to get backlash for my post but I need to.
I have to say, I have read the most uneducated posts on here about the housing on a roid board. As a finance person, there is no best investment than buying a home. The only time I would suggest waiting and renting is if you most likely will not stay in the area for long (less than 2 years). I purchased a two bedroom condo in my 20's as a pre-contruction in 1995 for $121K, at the height of the market boom it was worth $360K, it is now selling for around $285K here in NJ, I am renting it out right now at $1775 (which is actually low rent) and pocketing $516 per month as well as another $440 that they are paying towards my mortgage principle. So I am actually pocketing close to $1K monthly. Anyone who had a clue in 2007 at least should have known we were in a bubble, when the market heats up like it did and so much speculation on prices are given, houses getting bid up and huge price wars should be a red flag to anyone....remember the internet bubble in 2000, as a marketeer I do, sold into that bubble as well.
I did purchase a new home in March 2012 at a great price with no competition for bidding. I have already see an appreciation in my new home of over $50K in a 1 1/2 years. I can also rent this home out as well (per my real estate) for another $425 per month on top of the mortgage principle. I also get to deduct my real estate taxes and mortgage interest on both homes on my taxes.
Point being, you have no equity being built on renting nor can you deduct anything at year end and in 20 years you will still have nothing and your rent will be much higher than today's dollars. Save up, put a good down payment and do not over extend yourself, make sure you can afford your new home.

Great post - yeah it is obvious that not very many people on here are financially literate. This is a boom and bust economy: there are signs when we have hit a top (e.g. when the general public thinks things are great or when the general public starts pouring into the stock market) and that is when the smart money can make a killing.

Use debt to your advantage, especially when you are younger (translation: renting is often a bad use of your money. Either use debt to your advantage or invest your money elsewhere while you are renting)

 

[360]

I'm sure I am going to get backlash for my post but I need to.
I have to say, I have read the most uneducated posts on here about the housing on a roid board. As a finance person, there is no best investment than buying a home. The only time I would suggest waiting and renting is if you most likely will not stay in the area for long (less than 2 years). I purchased a two bedroom condo in my 20's as a pre-contruction in 1995 for $121K, at the height of the market boom it was worth $360K, it is now selling for around $285K here in NJ, I am renting it out right now at $1775 (which is actually low rent) and pocketing $516 per month as well as another $440 that they are paying towards my mortgage principle. So I am actually pocketing close to $1K monthly. Anyone who had a clue in 2007 at least should have known we were in a bubble, when the market heats up like it did and so much speculation on prices are given, houses getting bid up and huge price wars should be a red flag to anyone....remember the internet bubble in 2000, as a marketeer I do, sold into that bubble as well.
I did purchase a new home in March 2012 at a great price with no competition for bidding. I have already see an appreciation in my new home of over $50K in a 1 1/2 years. I can also rent this home out as well (per my real estate) for another $425 per month on top of the mortgage principle. I also get to deduct my real estate taxes and mortgage interest on both homes on my taxes.
Point being, you have no equity being built on renting nor can you deduct anything at year end and in 20 years you will still have nothing and your rent will be much higher than today's dollars. Save up, put a good down payment and do not over extend yourself, make sure you can afford your new home.

I agree with everything you said. In my post I stressed long term plans. You stressed investment. Both are similar in this case. After 20 years you have nothing to show for if you rent.

 

[ripped358]

You must remember with a house your always fixing something.
I bought my house outright 5 years ago.it wasnt in the best condition when I bought it so I had to throw out everything in the house , bought all new furniture, had the living room redone,the basement I had it tiled and put in a home gym.also had the laundry room redone, the garage needed a new door with push button entry and had the garage fixed so I can put my car in
I redone the first floor half bathroom.new sink toilet painting tiles on the floor and walls, new sink.
We recently redone are kitchen all new appliances ,painting,granite,cost us a fortune.
Then as soon we finished this are full bathroom on the second floor started leaking down into the newly done half bathroom
So we must get it done soon and its not cheap.
Then we have 3 bedrooms upstairs the main bedroom needs all new furniture it's still empty. We have a second bedroom where we stay now which is just a little smaller than the main bedroom which needs all new furniture and the third bedroom we use for guests and is also the computer room that needs some electrical work
So basically with a house be prepared to have to fix things and the bigger the home the more the money everything is.
its a never ending project.
If you know how to do this stuff yourself it would be alot cheaper
I just don't want you to think you just buy a house pay your bills and that's it.
Plus we have someone that does are lawn,that's another bill plus we have a huge deck I'n the backyard which needs uptake
Ok I'm done I'm just saying how it is

 

[richiec]

You must remember with a house your always fixing something.
I bought my house outright 5 years ago.it wasnt in the best condition when I bought it so I had to throw out everything in the house , bought all new furniture, had the living room redone,the basement I had it tiled and put in a home gym.also had the laundry room redone, the garage needed a new door with push button entry and had the garage fixed so I can put my car in
I redone the first floor half bathroom.new sink toilet painting tiles on the floor and walls, new sink.
We recently redone are kitchen all new appliances ,painting,granite,cost us a fortune.
Then as soon we finished this are full bathroom on the second floor started leaking down into the newly done half bathroom
So we must get it done soon and its not cheap.
Then we have 3 bedrooms upstairs the main bedroom needs all new furniture it's still empty. We have a second bedroom where we stay now which is just a little smaller than the main bedroom which needs all new furniture and the third bedroom we use for guests and is also the computer room that needs some electrical work
So basically with a house be prepared to have to fix things and the bigger the home the more the money everything is.
its a never ending project.
If you know how to do this stuff yourself it would be alot cheaper
I just don't want you to think you just buy a house pay your bills and that's it.
Plus we have someone that does are lawn,that's another bill plus we have a huge deck I'n the backyard which needs uptake
Ok I'm done I'm just saying how it is

That's "how it is" because YOU decided to buy a house that needed a bunch of work, simple as that!

BTW, you seem to have a lot of money for someone who is on Medicaid and disability, how's that work out?

 

[jimmyjones]

That's "how it is" because YOU decided to buy a house that needed a bunch of work, simple as that!

BTW, you seem to have a lot of money for someone who is on Medicaid and disability, how's that work out?

Nicca's bout to build a 1500HP Twin Turbo Camaro.....dude must be wiping his ass with Benjamins.

 

[ripped358]

That's "how it is" because YOU decided to buy a house that needed a bunch of work, simple as that!

BTW, you seem to have a lot of money for someone who is on Medicaid and disability, how's that work out?

Girlfriend works 2 jobs and does well

 

[jay_dub]

I'm sure I am going to get backlash for my post but I need to.
I have to say, I have read the most uneducated posts on here about the housing on a roid board. As a finance person, there is no best investment than buying a home. The only time I would suggest waiting and renting is if you most likely will not stay in the area for long (less than 2 years). I purchased a two bedroom condo in my 20's as a pre-contruction in 1995 for $121K, at the height of the market boom it was worth $360K, it is now selling for around $285K here in NJ, I am renting it out right now at $1775 (which is actually low rent) and pocketing $516 per month as well as another $440 that they are paying towards my mortgage principle. So I am actually pocketing close to $1K monthly. Anyone who had a clue in 2007 at least should have known we were in a bubble, when the market heats up like it did and so much speculation on prices are given, houses getting bid up and huge price wars should be a red flag to anyone....remember the internet bubble in 2000, as a marketeer I do, sold into that bubble as well.
I did purchase a new home in March 2012 at a great price with no competition for bidding. I have already see an appreciation in my new home of over $50K in a 1 1/2 years. I can also rent this home out as well (per my real estate) for another $425 per month on top of the mortgage principle. I also get to deduct my real estate taxes and mortgage interest on both homes on my taxes.
Point being, you have no equity being built on renting nor can you deduct anything at year end and in 20 years you will still have nothing and your rent will be much higher than today's dollars. Save up, put a good down payment and do not over extend yourself, make sure you can afford your new home.

I'm not even a finance guy but when I saw ppl recommending to rent over buying I was shocked as hell too! I thought that was common sense?

Just some very general tips for you guys...

The only debt that anyone *should * allow themselves to have is mortgage. Ideally you don't even want a car loan (house and car is the absolute max debt you would ever want, and goal would be to get rid of car loan as fast as possible).

ALWAYS buy vs. rent unless you aren't sticking around (2 yrs as upeccmi mentioned)

Invest as early as you can with the most you possibly can

Invest in 401k if your company matches, max you want to invest into 401k is the maximum percentage your company will match. Stop at that point

Invest further into medium risk such as a Roth Ira.

Banks are bad, they are in the business of making money, they do NOT have your best interest in mind.

No one gets wealthy by saving money!

Saving accounts are a joke, interest rates vs. inflation means you're actually losing money

These are all just off the top of my head but always keep these sort of things in mind. If you can actually do these things you will be very well off

Sent from my SCH-R970 using Tapatalk 2

 

[upeccmi]

Ripped---I agree that when you buy a home the repair are all yours but remember to buy smart, if you are buying a fixer-up house then get it at your price, with all the repairs factored in or walk away. This will save you alot of grief and expense later on. But one good thing is you are fixing it your way and to your liking and not your landlords taste (which is usually a cheap fix).
I was lucky enough to buy new on my first home, as I swore never to pay rent to anyone, stayed home a little while longer than I wanted to but sucked it up. I got engaged and bought my first place, well under my affordability scale which aloud me to continue saving and investing (in stocks) for my new home I purchased last year.
Jay Dub--- You are right, mortgages are the only acceptable debt, of course other debt is needed in life (car loan) but we have become a debt ridden society where everyone lives too far beyond their paychecks and relies on credit cards and other financing for instant gratification. Live below your means, save and invest. Investing can be simple as opening your 401k (WHICH IS IMPORTANT). or investing in a no load mutual fund (which are no brainer ways to invest and make money.
Become your own bank!

 

[ripped358]

Ripped---I agree that when you buy a home the repair are all yours but remember to buy smart, if you are buying a fixer-up house then get it at your price, with all the repairs factored in or walk away. This will save you alot of grief and expense later on. But one good thing is you are fixing it your way and to your liking and not your landlords taste (which is usually a cheap fix).
I was lucky enough to buy new on my first home, as I swore never to pay rent to anyone, stayed home a little while longer than I wanted to but sucked it up. I got engaged and bought my first place, well under my affordability scale which aloud me to continue saving and investing (in stocks) for my new home I purchased last year.
Jay Dub--- You are right, mortgages are the only acceptable debt, of course other debt is needed in life (car loan) but we have become a debt ridden society where everyone lives too far beyond their paychecks and relies on credit cards and other financing for instant gratification. Live below your means, save and invest. Investing can be simple as opening your 401k (WHICH IS IMPORTANT). or investing in a no load mutual fund (which are no brainer ways to invest and make money.
Become your own bank!

I bought the house really cheap all said and done i saved a ton of money even with making everything to our liking.

 

[woodswise]

Real estate has doubled or more in value every generation for the past 100 years. It will continue to rise in value, so long as the nation's population continues to increase (as it does now).

If you spend 1000 per month on rent, that means you can buy a house or condominium for 200,000 for a similar monthly payment.

Real estate prices are starting to recover from the last bust. They'll never be lower ever again in our lifetimes.

All of this argues in favor of buying a house.

That said, if you don't plan to stay put at least 5 years, or if you have very cheap rent for good housing, or if you don't have stable enough income to be sure of making your mortgage payment, maybe you shouldn't buy a house.