|
etalian posted:Not really probably biggest factor is how long you intend to stay in the area, given how home debtorship has other costs such Down payment isn't a dead cost, it comes back at the end unless you get negative change in value. Closing costs matter, but honestly, my closing costs will be eaten up by the rent vs buy cost difference in about 2-3 years. Assuming zero appreciation, that's the timeline where it's cheaper to rent for me, and that's fairly typical for major urban areas at this point.
|
#
?
Jun 8, 2014 02:33
|
|
|
|
| # ? May 8, 2024 12:19 |
|
|
The US is somewhat unique case due to all the direct and indirect help homeowners get from Uncle Sam in everything from long term fixed rate loans to a tax deduction that even covers HELOC interest payments. The sad thing is despite the downsides other countries such as Canada and the UK thought it would be a good idea to copy the US model for housing.
|
|
#
?
Jun 8, 2014 02:34
|
|
|
etalian posted:The US is somewhat unique case due to all the direct and indirect help homeowners get from Uncle Sam in everything from long term fixed rate loans to a tax deduction that even covers HELOC interest payments. The US is also what this thread is about.
|
|
#
?
Jun 8, 2014 02:39
|
|
|
etalian posted:Not really probably biggest factor is how long you intend to stay in the area, given how home debtorship has other costs such Also because the amortization of the mortgage means that each successive payment is an increasing percentage of equity so constantly recycling mortgages ends up being a way worse deal than what the stated rate is.
|
|
#
?
Jun 8, 2014 02:51
|
|
|
Dr.Zeppelin posted:Also because the amortization of the mortgage means that each successive payment is an increasing percentage of equity so constantly recycling mortgages ends up being a way worse deal than what the stated rate is. You'd have to compare the decrease in principal with costs associated with buying and selling (staging, fixes, 6% to Realtor) and any appreciation in value. Compared to renting, moving costs would be a wash. I hope i can plan on being out of this house in less than 2 months which would make my stay 2 years and 4 months, and if the Phoenix market didn't have an abnormal amount of rebound, i'd be easily losing money on selling the house. That's between improvements, upkeep, property taxes and god drat pool maintenance. I just hope I can get what prices are currently reflecting.
|
|
#
?
Jun 8, 2014 03:07
|
|
|
|
|
#
?
Jun 8, 2014 03:24
|
|
|
Dirt posted:I guess being from where I am from(Detroit area, now upper peninsula of Michigan) I never really realized HOA's were a thing. Are they basically in all "nice" neighborhoods in all large cities around the country? I lived in Dallas and Phoenix, but I rented both times so I never heard anything about it. Huh? I live in the Detroitish area and subdivisions are everywhere, and I'm pretty sure they all have HOAs. Are they a lot more of a recent development than I thought they were, because they are literally ~everywhere~ around here in the suburbs these days.
|
|
#
?
Jun 8, 2014 03:34
|
|
|
etalian posted:The US is somewhat unique case due to all the direct and indirect help homeowners get from Uncle Sam in everything from long term fixed rate loans to a tax deduction that even covers HELOC interest payments. Don't forget about whatever it is that is going on in Australia. Their negative gearing tax treatments sound like the US deduction plus some more insanity. Powercrazy posted:Amazing analysis. That is what NYC came from. I think we are more aiming toward a San Francisco end game actually because anything above two-three stories gets nixed outside of the city center and some very limited corridors. Amusingly taxpayers here are starting to get really really pissed about how businesses are gaming the property tax system. Turns out the "Texas Miracle" is once again revealed to be predicated on screwing over everyone but those knighted by Perry and Co. I highly recommend everyone read that article about SF housing by the way, it is a great example of just how complex the issues are leading into the present housing situation in various cities.
|
|
#
?
Jun 8, 2014 03:36
|
|
|
VitalSigns posted:I've lived in Austin for a few years, but now my sister is moving down and we're thinking of buying a house together. The home improvement industry never knew any other way to run but crookedly and with shoddy workmanship. These guys were nothing more than the descendants of the "tin men" who sold siding. When the bottom finally fell out of the market in 2008, the market for windows, siding, insulation etc. slowly dried up over the next few years. You couldn't just walk around having homeowners chase you down in the street and demanding to pay you $22,000 for vinyl windows anymore. Anybody who was stupid lost their shirt. Anybody who was smart got out of windows and siding and into bidding on foreclosures and flipping them with poo poo remodels. They would be like "kitchen remodel? I will cap this bitch with granite my tweaker nephew stole."
|
|
#
?
Jun 8, 2014 03:43
|
|
|
Kalman posted:Down payment isn't a dead cost, it comes back at the end unless you get negative change in value. Closing costs matter, but honestly, my closing costs will be eaten up by the rent vs buy cost difference in about 2-3 years. Assuming zero appreciation, that's the timeline where it's cheaper to rent for me, and that's fairly typical for major urban areas at this point. it's still dead money that's not being put to use in something like a dividend stock or even a more liquid investment.
|
|
#
?
Jun 8, 2014 04:02
|
|
|
etalian posted:it's still dead money that's not being put to use in something like a dividend stock or even a more liquid investment. If you can find a dividend stock paying out at 33% of invested value each year, please tell us all about it. (That's, conservatively, how much buying rather than renting saves me relative to my down payment.) Sure, it's dead money if the economics of buy vs rent were even, but given the preferential treatment for homeowners in the US combined with the social (often severe restrictions on rental property building) and economic (vampire squids converting properties to rentals and jacking rents, as well as general rent increases) that's often not the case. Everyone's math will work out differently, but the knee jerk in this thread against buying is blatantly stupid.
|
|
#
?
Jun 8, 2014 04:35
|
|
|
Right, the real problem is the series of incentives for home purchase and disincentives for renting that combine to strongly encourage people purchase when they otherwise wouldn't, which drives up housing costs for everyone. It is often the case that people buy not because owning a house is great but that their renting experiences were so awful.
|
|
#
?
Jun 8, 2014 04:48
|
|
|
Another neat US specific graph: Due to the bubble home ownership peaked around 69%
|
|
#
?
Jun 8, 2014 04:57
|
|
|
Dr. Arbitrary posted:My understanding is that because of the boom, there's been a real decrease in the quality of construction and the quality of inspection. Newer homes generally have better windows, insulation, a vapor barrier like Tyvek, and are built to a better code overall. Older homes often started out with better construction materials, mainly the wood was better and that asbestos tiles and shingles sure were something weren't they? But poor maintenance, which is the norm unfortunately, and age can turn them into standing financial disasters within 30 yr easy. In the end it don't matter how good the wood was when it went in or how good the original carpenter was when it was installed if the internal wood structure has been exposed to water, termites, and mold. Older code and weird construction practices also cause huge problems over time as well. Older homes generally have copper pipe for instance vs the PEX in newer homes but it was 'normal' to bend the pipe over your knee back in the day which often caused kinks which effected water pressure and tended to leak prematurely. They also didn't protect the copper from the concrete, today they're supposed to wrap it in something, even if its just cardboard lying around the site it makes a big difference in longevity of the pipes. Old style wiring practices suuuuuucked horribly and so upgrading older 40-60A service is usually an expensive exercise in frustration. Also makes adding a ceiling fan a real frustrating chore too. You'll find alll sorts of surprises in the walls once you start tearing stuff apart to fix or add something. Where newer bubble homes tend to fall apart is on the detail stuff in the exterior and interior. Lots of money to be 'saved' there so the contractors get to pocket the difference. Usually shoddy jobs and materials were done on the drywall, painting, caulking, and the like. Sometimes the roof too in places where the weather is usually dry like CA and AZ. The really shady contractors will only nail down every 2nd or even 3rd row of shingles and use the crappiest 15yr rated ones along with the suspiciously cheap tar paper from Mexico to save $10 or so a roll. If you know what to look for and take care of it before the water/termites get it in this is usually not to expensive or difficult to fix. Or better yet to have the seller fix it or knock down the price accordingly.
|
|
#
?
Jun 8, 2014 06:12
|
|
|
Shifty Pony posted:Don't forget about whatever it is that is going on in Australia. Their negative gearing tax treatments sound like the US deduction plus some more insanity. Yeah the nimby-ism about MY VIEWS that blocks high rise apartments in the US is stupid. I visited China and they had like 100 40ish story buildings in the middle of the city, made rent cheap and commutes short. Plus parks are still widely available for scenery, along with everyone having a balcony.
|
|
#
?
Jun 8, 2014 06:30
|
|
|
Swan Oat posted:Here is a quote that is literally on the Department of Housing and Urban Development's website about affordable housing: My mortgage in the Minneapolis 'burbs is less than $670 month. Taxes and insurance bring it up quite a bit in the end. Even in Minneapolis the market is hosed. Mortgage+Taxes+Insurance-MortgageInterestDeduction on a '60s Rambler costs me less than a 1 bed room apartment. It is just absurd how distorted the market is.
|
|
#
?
Jun 8, 2014 06:44
|
|
|
Buying a house is an investment in the same way buying an engagement ring or a boat is an investment: i.e. It's an investment because the people selling them have realized they can make a lot more money if they say it is, but really you'd be hard pressed to even call it a gamble. And its even worse for housing because it's a loving necessity, so you get all the perversions of a market dominated by the same fake "investment" logic that props up worthless jewelry and diamond markets, except hurting real people. An investment is something you make money off of, and a house is not something you're going to make money off of. A boat? That can be an investment, sure, but unless you're buying a fishing trawler, it (along with your house) is not an investment. The practical benefits of owning a house will remain the same even if all houses are made free forever tomorrow. The only people who want rising home prices are those who think of grifters as people to aspire to. People who complain about things "lowering their property value" make me want to strangle them. I you're buying a home as an investment, you are actively working to make this country worse. If you're buying one because you want a place where you can live that you own, that you have freedom to improve and modify at will, that you want to give to your kids, awesome. If you're buying a house just because you expect a mark to stumble by sooner that you can convince to buy it for way more than its worth, you are officially part of the problem.
|
|
#
?
Jun 8, 2014 07:15
|
|
|
Xae posted:My mortgage in the Minneapolis 'burbs is less than $670 month. Taxes and insurance bring it up quite a bit in the end. That's less than my rent for a one bedroom in Austin. 
|
|
#
?
Jun 8, 2014 08:00
|
|
|
Badger of Basra posted:That's less than my rent for a one bedroom in Austin. median home price is 184,000 for Minneapolis
|
|
#
?
Jun 8, 2014 08:11
|
|
|
Badger of Basra posted:That's less than my rent for a one bedroom in Austin. Still not as pants-on-head retarded as SF; I'm paying 850 for my share of the rent in what amounts to two basement studios hooked together by a bath and kitchen in a semi-desirable neighborhood. I don't even want to think about how out of my range honest-to-God real estate is here.
|
|
#
?
Jun 8, 2014 08:13
|
|
|
Are there campgrounds nearby? Tents don't cost too much.
|
|
#
?
Jun 8, 2014 10:39
|
|
|
This is a good thread.
FRINGE fucked around with this message at 22:28 on Jun 8, 2014 |
|
#
?
Jun 8, 2014 10:43
|
|
|
Prepare to hate me: I rent a 1 bedroom with a decent kitchen and living room in a Chinese city for $140/month. I could live in a more upscale property closer to the city center for about $300/month but I'm closer to my job this way. I'm trying to get back to the states though.
|
|
#
?
Jun 8, 2014 11:23
|
|
|
RPZip posted:Huh? I live in the Detroitish area and subdivisions are everywhere, and I'm pretty sure they all have HOAs. Are they a lot more of a recent development than I thought they were, because they are literally ~everywhere~ around here in the suburbs these days. Michigoon reporting in and I can say they have definitely been a thing for a while and exist as 1. a way to get the roads plowed and 2. As an excuse to keep tabs on the minority ethnic group that moved in and send out letters regarding too many cars being at the house and that everyone should be on high alert.
|
|
#
?
Jun 8, 2014 13:15
|
|
|
DC burb of Arlington here. Between the rapid build out and gentrification of the area, my rent is 2250/month for a 780 sq ft 1 bed. My gf and I are about to move-in with her mom to try and save up enough for a down payment on a place, but anything inside the beltway worth living in is half a million at best. We couldn't even afford to buy the condo we're renting, I'm pretty sure our landlord is taking a loss between his mortgage and HOA fees.
|
|
#
?
Jun 8, 2014 14:17
|
|
|
GlyphGryph posted:Buying a house is an investment in the same way buying an engagement ring or a boat is an investment: i.e. It's an investment because the people selling them have realized they can make a lot more money if they say it is, but really you'd be hard pressed to even call it a gamble. I purchased my house in '09 and I would be amazed if I don't make a profit when I sell. But I purchased at the low point of the market many people will end up losing money on their house. But that doesn't mean it isn't an investment. Investments are not guaranteed to make money. My uncle got out of the navy and purchased a modest house in California 40 years ago. He sold it for almost a million dollars a few years ago. Your post is more DisgruntledMillennial.txt than reality.
|
|
#
?
Jun 8, 2014 15:11
|
|
|
Bel Shazar posted:At current rates that $300k house will run you around $1250/month plus taxes and insurance assuming you can hit a 20% down payment and avoid PMI (gently caress PMI, seriously). I'm curious how you arrived at this number. Our house cost less than that, our rate is around 4.5% - 5% and our payments are $1450/mo. Now, we roll our taxes into the payment, put down less than 20% and still have the PMI (we have to) so maybe I just answered my own question.
|
|
#
?
Jun 8, 2014 16:42
|
|
|
BiggerBoat posted:I'm curious how you arrived at this number. Our house cost less than that, our rate is around 4.5% - 5% and our payments are $1450/mo. Now, we roll our taxes into the payment, put down less than 20% and still have the PMI (we have to) so maybe I just answered my own question. 240K (300K -20% Down) at 5% is $1,288.37. At least according to the first mortgage calculator google popped up.
|
|
#
?
Jun 8, 2014 17:14
|
|
|
Xae posted:I purchased my house in '09 and I would be amazed if I don't make a profit when I sell. My uncle got out of the navy and purchased a modest house in California 40 years ago. He sold it for almost a million dollars a few years ago. Your post is more DisgruntledMillennial.txt than reality.
|
|
#
?
Jun 8, 2014 17:23
|
|
|
Badger of Basra posted:That's less than my rent for a one bedroom in Austin. This is why we should make an Austin goon co-op, buy a goon house of our own, and stop making landlords rich! 
|
|
#
?
Jun 8, 2014 17:33
|
|
|
VitalSigns posted:This is why we should make an Austin goon co-op, buy a goon house of our own, and stop making landlords rich! Who is going to clean out all the pee when some goon discovers he can pee through the floorboards?
|
|
#
?
Jun 8, 2014 17:37
|
|
|
effectual posted:Are there campgrounds nearby? Tents don't cost too much. I did have a laugh finding a craigslist posting for Santa Cruz, you could rent yurts at some isolated campground for $200 a month. Finally some reasonably priced rentals for the Bay Area. On a side note even though multi-family construction starts have accelerated for many urban areas, the whole nature of infill construction means most project are still a decade away until completion. Ideally hopefully due to so many people getting burned home ownership will drop down to more reasonable levels such as 60% to 65% percent of all properties, for other developed countries it's around 55% to 60% etalian fucked around with this message at 17:47 on Jun 8, 2014 |
|
#
?
Jun 8, 2014 17:45
|
|
|
GlyphGryph posted:Buying a house is an investment in the same way buying an engagement ring or a boat is an investment: i.e. It's an investment because the people selling them have realized they can make a lot more money if they say it is, but really you'd be hard pressed to even call it a gamble.
|
|
#
?
Jun 8, 2014 17:45
|
|
|
MickeyFinn posted:Who is going to clean out all the pee when some goon discovers he can pee through the floorboards? Whoever has the highest score on the cishetracistmysogynist shitlord chart ( !) of course!
|
|
#
?
Jun 8, 2014 17:51
|
|
|
PC LOAD LETTER posted:Only a tiny relative handful of people have made money off the boom/bust or housing in general while millions have lost big or even most everything they own. That doesn't sound like a viable investment strategy to me. Really it sounds like your uncle got lucky when he bought and sold and you have gotten lucky to be able to buy during a down turn in the housing market. I held off buying a house for a few years because I thought the market would collapse. The prices were insane. I started looking half-assed in '06 and realized despite having no other debt and good paying job I couldn't afford a good house. I realize there was a bubble and waited. A lot of people told me I was stupid and "housing prices never go down", and "you're wasting money in an apartment". I held to my belief and waited. I closed a couple of weeks after AIG collapsed, having locked in my interest rates before the whole poo poo storm. It ain't all luck. 
|
|
#
?
Jun 8, 2014 17:57
|
|
|
etalian posted:Ideally hopefully due to so many people getting burned home ownership will drop down to more reasonable levels such as 60% to 65% percent of all properties, for other developed countries it's around 55% to 60%
|
|
#
?
Jun 8, 2014 18:00
|
|
|
LemonDrizzle posted:Sorry, but this is silly. An investment is something you invest money into in the hope of receiving some kind of future gain, whether that's capital appreciation, some kind of dividend, or whatever. Houses can provide both. The fact that house ownership has ongoing costs doesn't somehow disqualify it as an investment any more than a manager's fees disqualify managed funds as investments. You can argue about whether or not a given house is a good investment or whether the housing market should be more tightly regulated to prevent certain undesirable behaviours by investors (e.g. to make speculation unattractive), but a property purchase very clearly is a type of investment.
|
|
#
?
Jun 8, 2014 18:09
|
|
|
ShadowHawk posted:By this logic baseball cards are an investment. They can be, depending on the specific card.
|
|
#
?
Jun 8, 2014 18:16
|
|
|
ShadowHawk posted:By this logic baseball cards are an investment. There's a grain of truth there, but it would be rather strange to advocate a national policy encouraging everyone to go into debt to buy them. More generally, home ownership is widely considered to provide a range of social benefits, primarily because it makes people more likely to care about the upkeep of the area they live in. That's one of the main justifications for its heavy subsidization in various countries.
|
|
#
?
Jun 8, 2014 18:22
|
|
|
|
| # ? May 8, 2024 12:19 |
|
|
LemonDrizzle posted:More generally, home ownership is widely considered to provide a range of social benefits, primarily because it makes people more likely to care about the upkeep of the area they live in. That's one of the main justifications for its heavy subsidization in various countries. Ha ha, love this classic realtor line about home ownership being good since people will take care of the area better, while renters will destroy a neighborhood like a mongol horde because they don't have a mortgage to keep them responsible for the property.
|
|
#
?
Jun 8, 2014 18:25
|
|