|
Scapegoat posted:You mean like low / no dividend shares? It's not shares paying dividends are much different if the share price drops according to the amount of dispensed cash. I don't really see the problem, it is a genuine loss. If they didn't inflate the price of housing they would inflate the price of something else that they invested in in its stead. NIMBY types creating arbitrary shortages in housing seems like the real problem. Jeffrey of YOSPOS fucked around with this message at 06:41 on Jul 24, 2014 |
#
?
Jul 24, 2014 06:12
|
|
|
|
| # ? May 14, 2024 14:31 |
|
|
Shares also don't need maintenance, amongst other potential issues.
|
|
#
?
Jul 24, 2014 06:32
|
|
|
Jeffrey posted:It's not shares paying dividends are much different if the share price drops according to the amount of dispensed cash. I don't really see the problem, it is a genuine loss. If they didn't inflate the price of housing they would inflate the price of something else that they invested in in its stead. NIMBY types creating arbitrary shortages in housing seems like the real problem. Oh I agree it's not just negative gearing causing the problem, there's stuff like discounts on capital gains tax on residences which contribute. I'm just of the opinion that property speculation caused by negative gearing is particularly bad because it shelters significant sums of money that would normally be taxed and it diverts money away from economic activities that actually grow the economy (only 3% of negatively geared properties were bought new, the rest consists of existing housing stock).
|
|
#
?
Jul 24, 2014 07:22
|
|
|
froglet posted:Negative Gearing We have a similar system in the Netherlands, minus the renter bit. I think the laws commonly protecting tenants in Europe were discussed before, I have a mortgage contract that says I am not allowed to rent my mortgaged property out, ever. But I can deduct the interest portion of my mortgage from my income tax. This means richer people who pay higher taxes actually get to deduct way more (more expensive house multiplied by higher tax bracket). I even have a special type of mortgage where instead of paying off the principal I save up an amount of money equal to the principal. Meaning I pay full interest on the full principal for the whole length of the mortgage, while the bank pays me interest on my saved up money which happens to be at a percentage equal to the interest I pay. New mortgages are no longer allowed to do this. However the hosed up bit is that what started as a way to subsidize home ownership has basically ended up just inflating house prices. If the bank determines I can pay, say, $1000/mo on my mortgage, they'll let me lend, say, $200,000. Now people start getting this tax deduction. I end up actually paying $650 (just spitballing numbers here to sketch a scenario). But now the next person with the same income I have can still afford $1000/mo. So the bank incalculates the tax break, and the $1000/mo will now afford a $250,000 - $300,000 house. Does this mean people can buy bigger houses? No, with everyone now being able to spend more on houses house prices just go up accordingly. You see the same thing happening with the growth of the number of dual income families - spending power increases, but house prices just grow with it and the average family still lives in the same average house, they just pay more for it. If the government ends the tax break instantly a lot of people will suddenly not be able to afford their mortgage anymore causing a massive housing crisis. But it is possible to create other scenarios where nobody is excessively affected, though it would take much longer to fully get rid of it. Some political parties use keeping the tax break as a way to attract voters. Of course they refer to the first scenario as what is obviously the only method that could possibly be used by any rival party that even dares mentioning the tax break might not be the best thing ever.
|
|
#
?
Jul 25, 2014 08:59
|
|
|
This negative gearing is a bit off putting to me. Why is it that a person's rent should cover everything AND put profit in your pocket? Isn't that textbook classic exploitation/rentier class? One group, largely through luck, has access to the capital to buy property, and then extracts rent from a group that, again, largely through luck, will never have access to the capital to buy a place and must funnel rent forever? Mind you, renting makes sense many times, as does renting out property, but in my mind, the profit should come after the owner has paid off the mortgage (early, or over time) rather than every month from the very first one. Very distasteful situation when it comes to housing, *personally*.
|
|
#
?
Jul 25, 2014 12:14
|
|
|
poopinmymouth posted:This negative gearing is a bit off putting to me. Why is it that a person's rent should cover everything AND put profit in your pocket? Isn't that textbook classic exploitation/rentier class? One group, largely through luck, has access to the capital to buy property, and then extracts rent from a group that, again, largely through luck, will never have access to the capital to buy a place and must funnel rent forever? Good point. I'm going to go picket Enterprise and Thrifty.
|
|
#
?
Jul 25, 2014 13:35
|
|
|
Again, positive cashflow doesn't equal profit. You have to take into account maintenance, taxes, insurance and depreciation. Depreciation hasn't happened in real estate around here in a while, but it's still a thing. The landlord also shoulders the risk of owning the property and operating it as a business venture, which does, in a way, have a cost.
|
|
#
?
Jul 25, 2014 13:49
|
|
|
poopinmymouth posted:This negative gearing is a bit off putting to me. Why is it that a person's rent should cover everything AND put profit in your pocket? Isn't that textbook classic exploitation/rentier class? One group, largely through luck, has access to the capital to buy property, and then extracts rent from a group that, again, largely through luck, will never have access to the capital to buy a place and must funnel rent forever? Are you really going to declare "luck" as the reason someone may have capital to buy an investment property?
|
|
#
?
Jul 25, 2014 15:06
|
|
|
FrozenVent posted:Again, positive cashflow doesn't equal profit. You have to take into account maintenance, taxes, insurance and depreciation. Depreciation hasn't happened in real estate around here in a while, but it's still a thing. Pretty much this. I can see why many see renting out shelter as a means of making money as repellent or predatory, but there will always be a place for landlords/leasing. My only issue with owning investment properties is when they're speculating the area will increase in value so they can sell at a profit. The speculation is what's bad, not leasing it out.
|
|
#
?
Jul 25, 2014 15:15
|
|
|
nickutz posted:Are you really going to declare "luck" as the reason someone may have capital to buy an investment property? Yes? Are you really going to declare anywhere in the world is even remotely meritocratic? The US and UK are tied for dead last in social mobility (in the OECD), combined with Pickety's latest book proving inherited wealth far outpaces saving, the idea that it's just elbow grease and good choices that allows one to buy more than one property (and conversely, bad choices if lacking the capital) is patently ridiculous without swimming pools worth of drunk koolaid. froglet posted:Pretty much this. I can see why many see renting out shelter as a means of making money as repellent or predatory, but there will always be a place for landlords/leasing. My only issue with owning investment properties is when they're speculating the area will increase in value so they can sell at a profit. The speculation is what's bad, not leasing it out. I specifically stipulated I'm not against renting or owning multiple properties. There are definitely gray areas even for me. I mean I am a rental property owner, I'm just not expecting my renters to pay over the mortgage payment by a significant amount from day 1. The profit comes from long term planning rather than milking people with no other choice. poopinmymouth fucked around with this message at 15:30 on Jul 25, 2014 |
|
#
?
Jul 25, 2014 15:27
|
|
|
poopinmymouth posted:I mean I am a rental property owner, I'm just not expecting my renters to pay over the mortgage payment by a significant amount from day 1. But a mortgage payment can vary wildly based on how much you put down on the property, as can someones definition of "significant".
|
|
#
?
Jul 25, 2014 15:50
|
|
|
sanchez posted:But a mortgage payment can vary wildly based on how much you put down on the property, as can someones definition of "significant". That's definitely true. Though I imagine most people put down the lowest down payment possible, 10-20%, especially in countries like the US where mortgages can be had with such low interest rates.
|
|
#
?
Jul 25, 2014 16:02
|
|
|
nickutz posted:Are you really going to declare "luck" as the reason someone may have capital to buy an investment property? Of course it's all luck. Look at slow motion for example - right now he is doing everything in his power to save money and he just can't get ahead. Maybe one day he will be lucky and win the lottery or something, but until then wtf is he supposed to do?
|
|
#
?
Jul 25, 2014 16:09
|
|
|
A quick hit to keep us from any sort of bootstraps debate: http://www.reddit.com/r/personalfinance/comments/2bpdsl/unable_to_refinance_a_car_with_a_huge_monthly/ quote:I'm pretty sure they hosed me on the cost but I didn't have too many options at the time and it was a nice car. I owe $22k at 12.79% which is $485/mo. I am able to pay this but I'd rather have more money right now so that I can be a bit more comfortable. I'm ok with paying a ton in interest for the drat thing over a long period of time if I can get the payments to $350 or less so that I can actually put some money towards an emergency fund or pay off other higher interest credit cards. I got screwed on my car and loan, reddit please help me get a worse loan 
|
|
#
?
Jul 25, 2014 18:13
|
|
|
rrrrrrrrrrrt posted:A quick hit to keep us from any sort of bootstraps debate: "I didn't have options and it was a nice car." Get a less nice car, dummy!
|
|
#
?
Jul 25, 2014 19:31
|
|
|
Oh man I don't have a lot of money to play around with, better get a brand new car.
|
|
#
?
Jul 25, 2014 19:37
|
|
|
Renegret posted:Oh man I don't have a lot of money to play around with, better get a brand new car. Read more carefully. It was a used car. Guy got hosed.
|
|
#
?
Jul 25, 2014 19:39
|
|
|
quote:I'm not disagreeing it was a bad idea, I didn't plan to get a car that day. But I needed one and I felt bad about the guy wasting 3 hours showing me all of them... quote:That's true, I don't feel quite as bad about it when its put like that. Granted I know they still made a ton of profit off of it (It was used, about 20k miles on it. I looked a month ago and a brand new one, without all the extra poo poo mine has, is $22k, 2k less than I started at) Some people...
|
|
#
?
Jul 25, 2014 19:40
|
|
|
Bugamol posted:Read more carefully. It was a used car. Guy got hosed. God drat. I saw the price tag and assumed it was new.
|
|
#
?
Jul 25, 2014 20:06
|
|
|
My cousin has owned his house for about 10 years and now finds that it's worth much more than when he bought it. (He bought somewhere between 150-200k and he saw a similar house in his neighborhood go for $400k recently.) I asked whether he was thinking about selling his house to cash in on this? No. His plan, it seems, is to refinance and then use the entirety of the loan to buy gold. He already invests as much money as possible into gold. He says he will buy it no matter the price, because "gold can only go up." I need to confirm this, but I also think he might physically buy the gold rather than buying commodities. I hope he keeps it in a safety deposit box, but I doubt it because... ...he also buys large quantities of nickles online because he believes that they are inherently worth more than five cents. He has bags of them in his house. He has also made recent forays into bitcoins, which seems at odds with his obsession with commodities and belief that the dollar is going to crash any day now. The nickel thing has me dumbfounded, but I found this explanation online, including advice on how to hoard nickels: Mass Inflation Ahead — Save Your Nickels! Edit: on the nickel front, this guy who bought one million dollars in nickels seems like my cousin's inspiration: quote:“We’ve bought a lot of this stuff,” Bass told a startled Lewis. In Bass’ case, he was talking about the real thing. No futures, no contracts, no “paper gold”. Thesaurus fucked around with this message at 21:07 on Jul 25, 2014 |
|
#
?
Jul 25, 2014 20:58
|
|
|
Is your cousin Ron Swanson?
|
|
#
?
Jul 25, 2014 21:10
|
|
|
Bugamol posted:Read more carefully. It was a used car. Guy got hosed. He didn't have any options.. Like the fact that he could have gotten a brand new eco car for 5-6k less than that.
|
|
#
?
Jul 25, 2014 22:35
|
|
|
I think my sister qualifies for this thread. She has a well paying job yet can't seem to save money. She takes multiple trips per year, moved into a place with higher rent last year and bought all new furniture. She bought an Xbox One last month. The other day she said she hasn't taken her son to the doctor or gotten him vaccinated since he was six months old because she doesn't have the money. He's turning three in a few months. BTW her insurance will fully cover her son's doctor visits. She just has to pay upfront and get reimbursed later. Priorities, I guess.
|
|
#
?
Jul 26, 2014 02:16
|
|
|
rayne503 posted:I think my sister qualifies for this thread. I think the United States qualifies for this thread on this count.
|
|
#
?
Jul 26, 2014 02:40
|
|
|
Aren't most of the vaccines like $10 with no insurance?
|
|
#
?
Jul 26, 2014 03:45
|
|
|
rayne503 posted:I think my sister qualifies for this thread. That's actually pretty frugal on her part. The poor little kid will get rotavirus or measles, it'll hit his unprepared immune system like a freight train, and after a quick outlay for the funeral, she'll have one less area of expenditure. People who don't vaccinate completely baffle me. Greatest advance in public health since mass sewage systems and people choose not to partake. Madness.
|
|
#
?
Jul 26, 2014 04:05
|
|
|
Thesaurus posted:My cousin has owned his house for about 10 years and now finds that it's worth much more than when he bought it. (He bought somewhere between 150-200k and he saw a similar house in his neighborhood go for $400k recently.) Well at least hes not going to buy gold at its 20 year high but anyone who thinks that a commodity can't go down is a certified moron. You already knew that though. He is definitely going to take a bath on metals like nickel because Goldman Sachs has been propping up the price with their warehousing scheme and they just sold that division so I would expect the price to drop with no more artificial scarcity.
|
|
#
?
Jul 26, 2014 04:54
|
|
|
Harry posted:Aren't most of the vaccines like $10 with no insurance? It's free if you're super poor (Medicaid) or you're not trying to avoid getting an Obamacare approved plan. Unless you go out of network on your plan, then you're proper hosed.
|
|
#
?
Jul 26, 2014 06:08
|
|
|
Preventative care is covered in full on every US insurance plan that I'm aware of (thanks Obama). Even when I got a Tetanus booster recently with a HDHP, my doctor billed it out to my carrier and they responded that I wasn't responsible for the charge.
|
|
#
?
Jul 26, 2014 14:25
|
|
|
I got a tetanus shot at a private clinic here ( ) and it was like $25.Could have gotten it for free at the community health center though so it made me feel pretty bad with money.
|
|
#
?
Jul 26, 2014 14:36
|
|
|
FrozenVent posted:I got a tetanus shot at a private clinic here ( Man, saving $25 on a once-every-couple-years (if not a once-or-twice-in-a-lifetime expense) is not bad with money. We're looking for stories for people buying $60,000 Hummers with $500 down at 29.999% APR! Try harder 
|
|
#
?
Jul 26, 2014 15:32
|
|
|
My cousin goes to a well-known college out of state (because heaven forbid he go to an in-state school that doesn't have prestige!). Tuition with room and board and meal plan is about $80,000/year. Last year was supposed to be his senior year, but dipshit decided to go to a rave. He had a bad trip and is now paranoid of being alone and traveling alone. Instead of taking medication the doctor prescribed to fix his brain, he refuses and has been back home for a year. The medical absence the school granted him is now expiring and he refuses to take online courses to complete his degree. $320,000 plus the cost of his parents driving him 500 miles back to school twice/month for the past year to see his girlfriend...and no degree EugeneJ fucked around with this message at 16:07 on Jul 26, 2014 |
|
#
?
Jul 26, 2014 15:57
|
|
|
EugeneJ posted:$320,000 There's got to be more to the story. I am the #1 college costs are too high cheerleader but this guy spent $320K on an undergrad? What the gently caress was he studying? First guess was.. out of state for-profit college? But you said it's well known. I'm not trying to make light of his mental health problems but it sounds like someone here's been taken for a ride -- him, his parents, whatever. My sister went to an out-of-state school in New York and 100% debt financed she ended up about 90K in debt. Still loving ridic but.. 320,000$$$$ for an education you didnt finish??? WTF????
|
|
#
?
Jul 26, 2014 16:59
|
|
|
seacat posted:There's got to be more to the story. I am the #1 college costs are too high cheerleader but this guy spent $320K on an undergrad? What the gently caress was he studying? Rich parents, precious snowflake who did terribly in high school and his dad called in a favor to his Alma Matter to get him admitted. It was all paid for in cash, so the kid has no sense of guilt or obligation since there's no loan-debt for him to burden. And it was for something dumb like Communications. Edit: oh yeah, precious snowflake also has both a private psychologist and private psychiatrist - I can't even imagine how much that costs. When my cousin doesn't like what the psychologist is saying, he just goes to the psychiatrist instead. The beauty of wealth! EugeneJ fucked around with this message at 17:10 on Jul 26, 2014 |
|
#
?
Jul 26, 2014 17:07
|
|
|
EugeneJ posted:Rich parents, precious snowflake who did terribly in high school and his dad called in a favor to his Alma Matter to get him admitted. It was all paid for in cash, so the kid has no sense of guilt or obligation since there's no loan-debt for him to burden. The real shame here is that his parents let him get away with it.
|
|
#
?
Jul 26, 2014 17:12
|
|
|
I Harvard is about that price with super rich rich parents.
|
|
#
?
Jul 26, 2014 18:00
|
|
|
seacat posted:There's got to be more to the story. I am the #1 college costs are too high cheerleader but this guy spent $320K on an undergrad? What the gently caress was he studying? I have a relative that teaches at an elite New England school. Not Ivy League, but on up there. Tuition and room and board are around $60,000 per year. The parents of the kids going there will buy condos(Probably around $300,000) in town to come visit on the weekend. They're like a different species.
|
|
#
?
Jul 26, 2014 18:04
|
|
|
Citizen Z posted:I have a relative that teaches at an elite New England school. Not Ivy League, but on up there. Tuition and room and board are around $60,000 per year. Homo Wealthicus Americus
|
|
#
?
Jul 26, 2014 18:31
|
|
|
froglet posted:tl;dr The Australian government has created an environment that encourages speculative investment which could topple our entire economy, which I think is pretty bad with money considering they're forgoing a bit of pain and political unpopularity now in exchange for unknown amounts of economic pain later. 1. Your house prices have been inflated for ages, there's a famous John Howard quote about no one ever complaining that their house rising in value making them richer. This is not a recent development. 2. One of your most popular TV exports is The Block which feeds into the 'buy a run down home and flash it up' ethos which contributes to almost all over the lower value housing stock disappearing. 3. I'm fairly sure that rising house prices in metropolitan areas are a thing all over the world. Seriously, I get where your coming from as someone who is unlikely to be able to afford a house where I live, but don't confuse a Government that isn't doing much about a problem with one that has caused it.
|
|
#
?
Jul 26, 2014 21:10
|
|
|
|
| # ? May 14, 2024 14:31 |
|
|
EugeneJ posted:Rich parents, precious snowflake who did terribly in high school and his dad called in a favor to his Alma Matter to get him admitted. It was all paid for in cash, so the kid has no sense of guilt or obligation since there's no loan-debt for him to burden. Haha, this sounds exactly like an old roommate. I think he was even majoring in communication by the time he dropped out. 80k/year is probably right on the money when you consider all the crazy stuff these kind of kids put on their parents credit cards in addition to base tuition and boarding. My roommate would charge everything to their card, and he would do cash back when he wanted to buy drugs. His parents were well off, but not the kind of rich that can set him up on his according to the kind of lifestyle he wants. I think he's doomed to live off their crumbs for a long, long time.
|
|
#
?
Jul 27, 2014 02:01
|
|