The nice thing about owning a home is that you actually build up your saving. If you at some point get in hot waters you can sell your home to get some backup cash.
In a healthy housing market, there’s enough competition that renting is much cheaper than buying. Indeed, I remember it being that way when I was a kid. Over the course of my life, landlording went from something that retired people did for a very small additional income stream to a get rich quick scam.
It must be different in different places. I went from a renter in one area, to an owner in the same area, to a renter again in a different area in the period of 5ish years (long story).
Rent in the first area was about the same cost for a two bedroom, two bath, 1000 sq ft apartment as the entire mortgage on a 3 bedroom, 2 bath, 1200 sq ft house, including principle, interest, and taxes. The only reason people would rent there is because they don’t have the money for a down payment.
When we left that area, we could have become landlords and rented the house out. We could have easily gotten twice the entire mortgage in rental income, but we felt that being a landlord was unethical (especially since we were relatively wealthy for that area, although we made less than the US median family income). We sold the house and broke even.
Now, we live in a much higher COL area. It’s true here that renting is much cheaper than buying, but that’s because you can’t get a SFH for less than about $1.5 million here. My rent on my 1 bed, 1 bath, 700 sq ft apartment is more than twice my mortgage in my previous area. Our incomes have increased, now we make slightly above the median family income. But our leftover at the end of the month honestly went down a ton. If we weren’t here to get an education, we’d be gone by now.
Just saying… As someone who has both rented and owned, I definitely feel more like I’m shoveling money into a fire as a renter. Owning was the best financial situation I’d ever been in.
That would be true of landlords didn’t also know that and, in turn, redline rent to the maximum tenants can possibly pay.
I don’t know about the US specifically, but In Canada, investors big and small have bought up all the rental stock and rents are now maxed out beyond what many people can pay.
The nice thing about owning a home is that you actually build up your saving. If you at some point get in hot waters you can sell your home to get some backup cash.
In a healthy housing market, there’s enough competition that renting is much cheaper than buying. Indeed, I remember it being that way when I was a kid. Over the course of my life, landlording went from something that retired people did for a very small additional income stream to a get rich quick scam.
This.
15 years ago, wifey and I talked of selling our home, renting (turnkey), and living off/investing the remaining equity.
Today? Let’s just say that “the best laid plans something something…”
As a boomer, one of the biggest “flaws” I see in this irl, is that people won’t sell their shit, and their dreams die in their sleep, with them.
Yea, that’s true. But I would say that is still better then forking over money into the rent furnace each month right?
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It must be different in different places. I went from a renter in one area, to an owner in the same area, to a renter again in a different area in the period of 5ish years (long story).
Rent in the first area was about the same cost for a two bedroom, two bath, 1000 sq ft apartment as the entire mortgage on a 3 bedroom, 2 bath, 1200 sq ft house, including principle, interest, and taxes. The only reason people would rent there is because they don’t have the money for a down payment.
When we left that area, we could have become landlords and rented the house out. We could have easily gotten twice the entire mortgage in rental income, but we felt that being a landlord was unethical (especially since we were relatively wealthy for that area, although we made less than the US median family income). We sold the house and broke even.
Now, we live in a much higher COL area. It’s true here that renting is much cheaper than buying, but that’s because you can’t get a SFH for less than about $1.5 million here. My rent on my 1 bed, 1 bath, 700 sq ft apartment is more than twice my mortgage in my previous area. Our incomes have increased, now we make slightly above the median family income. But our leftover at the end of the month honestly went down a ton. If we weren’t here to get an education, we’d be gone by now.
Just saying… As someone who has both rented and owned, I definitely feel more like I’m shoveling money into a fire as a renter. Owning was the best financial situation I’d ever been in.
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Nobody likes big unexpected costs. That’s why landlords tend to offload the risk to PMCs, warranties, and insurance.
And then your rent pays for the monthly costs of all of that.
spoiler
asdfasfasfasfas
That would be true of landlords didn’t also know that and, in turn, redline rent to the maximum tenants can possibly pay.
I don’t know about the US specifically, but In Canada, investors big and small have bought up all the rental stock and rents are now maxed out beyond what many people can pay.
spoiler
asdfasfasfasfas