Owning a home -- worth it?

[jonnyz1245]

Originally Posted by JUSTIFIED

Yep. And then you must still pay for taxes (on all that appreciation), insurance and maintenance. I've run the numbers and I honestly do not believe you come out ahead financially by owning (exceptions certainly exist), but that assumes that you rent affordably & invest the difference.

Agree w/ the "owning is a lifestyle choice" sentiment, which is the intrinsic value I mentioned in my OP.

A lot of interesting answers, but am surprised that so many ardently believe owning is better financially than renting.

250K or 500K if married is tax free on the gain if lived in 2 of 5 years.

[Ruud Van Driver]

I'm on both sides of the fence. We own our own home in the Saaarf East of England (well, to be factually accurate we own 85% of it; few quid left on the mortgage), which has increased in value by 40% since we bought it nine years ago. We over-pay the mortgage by 100% to get it paid off quicker.

I also rent a condo in Singapore. I rent as opposed to buying here because I don't have a huge amount of choice. Even though the market is right down, the prices are eye-wateringly expensive; my place is 850 sq.ft and would cost me about S$1.8 million (£1 million, US$ 1.36 million) to buy. No way on this earth am I hocking myself up to that sort of debt!

On the plus side, I don't have to worry about maintenance and when it comes time to go home, I just terminate my contract with the appropriate notice.

The biggest downside of a condo is that neighbours can be annoying such as when my neighbour next door goes onto his balcony for a cigarette, I have to shut my doors. One night I stepped out onto my balcony to look at the ships out at anchor and he was there smoking a fag, stark bollock naked! Fortunately, he had his back to me so I wasn't completely traumatised. Immediately below me is a concert-standard pianist. I'm not a fan of the style of music he plays but he's exceptionally good and, in fairness to the boy, he never plays for more than 15 minutes twice a day.

If sound proofing isn't outstanding, then all sorts of issues can arise; I'm quite lucky in that my neighbours are pretty good but I know when downstairs are going to bed because I can hear their curtains swishing. An annoying family 11 floors below me have a private pool and they had a party on a school night with noisy kids larging it up in the pool. At 2230, I had to go down and tell them to pipe it down because I'm up early for work in the morning.

Rent is also dead money; it costs me a fortune every month and I don't see a penny/cent return.

On the whole, I much prefer being a home owner than a tenant.

[zengineer]

In many markets you can't really rent what many homeowners want. I built the place I'm in now about 10 years ago. I wanted a 3+ car heated garage, 4+ acres, no neighbors within 500 feet or so, no HOA, minimal zoning rules, etc. That's not something you can rent very easily. I like cities for work and play but I want to go home to a place where it gets dark and quiet at night.

I've been lucky to buy and sell at the right time on my first two houses so we've definitely done significantly better than we ever could have renting. But if I had different wants or wasn't sure I'd be in the area long term I am sure renting would be something I'd consider. As it is where I live, renting is something people do until they can afford to buy.

[TheVTCGuy]

I can not give you accurate assessments on owning versus renting is a better decision financially, I guess arguments can be made for both. I will only say that my condo, close to the beach in La Jolla California is one of the proudest items I own, I’ll say THE proudest. It is about the size of most of your kitchens... Actually most of your kitchens are probably bigger but it is in a beautiful location in one of the finest cities in the world and I love it. I pay a mortgage every month, I am sure I could rent for less, but to me, home-ownership is one of my life’s greatest accomplishments. So, for me, it’s THE choice.

[BNA/LION]

Yes. I feel it is worth it. It really depends on what you like and how you like to spend your time. if you plan to travel 2-4 months a year than a condo is a good idea too. Lock it up and go! A house is not necessarily an investment but it is a place you can call home and it is yours to decorate or do whatever you want to it.

[tamiya]

Originally Posted by Ruud Van Driver

I also rent a condo in Singapore. I rent as opposed to buying here because I don't have a huge amount of choice. Even though the market is right down, the prices are eye-wateringly expensive; my place is 850 sq.ft and would cost me about S$1.8 million (£1 million, US$ 1.36 million) to buy. No way on this earth am I hocking myself up to that sort of debt!

Also a HUGE govt surcharge if you're not a local

The biggest downside of a condo is that neighbours can be annoying such as when my neighbour next door goes onto his balcony for a cigarette, I have to shut my doors. One night I stepped out onto my balcony to look at the ships out at anchor and he was there smoking a fag, stark bollock naked! Fortunately, he had his back to me so I wasn't completely traumatised.

That used to be euphemism back in the day... tobacco comes after!

Immediately below me is a concert-standard pianist. I'm not a fan of the style of music he plays but he's exceptionally good and, in fairness to the boy, he never plays for more than 15 minutes twice a day.

Lucky u. Our SG neighbour practices 3-4hrs a day. A lot of it is Clayderman... so it's like living in an elevator ah well.

If sound proofing isn't outstanding, then all sorts of issues can arise; I'm quite lucky in that my neighbours are pretty good but I know when downstairs are going to bed because I can hear their curtains swishing. An annoying family 11 floors below me have a private pool and they had a party on a school night with noisy kids larging it up in the pool. At 2230, I had to go down and tell them to pipe it down because I'm up early for work in the morning.

Idiot neighbours downunder think its ok to go out into apartment backyard to smoke & drink & chat... at 3am

I've been known to come out into my backyard with a camera AND TAKE A FLASH PHOTOGRAPH of their unsociable behavior.

Plus at 7am, my music system will be running full blast against our shared bedroom wall

(one of these days imagunna rig up an automatic garden watering system that comes on by remote control. My backyard is full of pot plants, they get thirsty at night..!!)

[Ruud Van Driver]

Originally Posted by tamiya

Also a HUGE govt surcharge if you're not a local



That used to be euphemism back in the day... tobacco comes after!



Lucky u. Our SG neighbour practices 3-4hrs a day. A lot of it is Clayderman... so it's like living in an elevator ah well.



Idiot neighbours downunder think its ok to go out into apartment backyard to smoke & drink & chat... at 3am

I've been known to come out into my backyard with a camera AND TAKE A FLASH PHOTOGRAPH of their unsociable behavior.

Plus at 7am, my music system will be running full blast against our shared bedroom wall

(one of these days imagunna rig up an automatic garden watering system that comes on by remote control. My backyard is full of pot plants, they get thirsty at night..!!)

I forgot about the surcharge for expats. Another reason not to buy here.

To be clear, 'smoking a fag' means inhaling and exhaling on a lit cigarette. Apologies if anyone misinterpreted.

I had some clown practicing piano (badly) in my last condo. I called the condo security (it's what they're there for) and had them ask the person to close their doors and windows. Didn't hear them again. If I were in your shoes, I'd either call security or pay the offender a visit yourself. I've done that to inconsiderate muppets in my last place.

What comes around goes around; your actions are entirely reasonable, sir. Might I suggest playing the album in my avatar

[tamiya]

Originally Posted by Ruud Van Driver

I forgot about the surcharge for expats. Another reason not to buy here.

Yeah foreigner buyers not welcome unless you've got more yuan than cents I get the hint & i'm happy to obey mr Goh

To be clear, 'smoking a fag' means inhaling and exhaling on a lit cigarette. Apologies if anyone misinterpreted.

meh I do a mean job of lighting up on balcony too.

Mosquito coils then I get outta there.

I had some clown practicing piano (badly) in my last condo. I called the condo security (it's what they're there for) and had them ask the person to close their doors and windows. Didn't hear them again. If I were in your shoes, I'd either call security or pay the offender a visit yourself.

Lots of noisemakers murdering music right here but I know who they are we sponsor their (un)music lessons plus to make things worse I am known to drag back odd instruments to self-learn including a moshpit of stringed... symphony of strangled cats any time of the day, yessir.

What comes around goes around; your actions are entirely reasonable, sir. Might I suggest playing the album in my avatar

nah what if they they might actually enjoy that

You might've forgotten I'm Asian so I've got licence to play Chinese opera, Chinese instrument orchestras, Buddhist chant recitals... and on one particular incident, the 24hr BBC Brexit count commentary.

Cruel & unpardonable punishment maybe, but repeat offenders few & far between

[SeaDweller50]

Rental prices are so bloody expensive daan Saarf of England, so I feel very lucky to have a mortgage on a modest property 300m from the sea. I jumped onto the housing ladder following the 2008 crash and so therefore got a very good deal. My military pension pays my mortgage which is a huge bonus.

But I can also see the merits in renting if that’s what suits your lifestyle.

[spoilsofwar01]

In 1992 I was put in a position of either rent privately or have a mortgage, doing the math's one thing was obvious long term if not my own I'd be paying off someone else's mortgage, It was hard for the first 5 years and the after some financial planning I completed a 25 year mortgage in only 18 years, Ive gone without lots but in the long run I'd say it was one of the best things I've ever done.

[droptopman]

We enjoy owning our home. Totally worth it to us. We were lucky with the timing of our last two houses. Current home was a semi custom build that we moved into in 2010. Rates for 15 years loans were so low we did the short term fixed and I am about halfway through paying this house off. Market has really went up in our area, so feeling pretty good about the "investment". Own a rental too and so far been pretty lucky with tenants. I do not raise the rent so the tenant will stay. We like him.

[123Blueface]

Originally Posted by Magwitch

Been in current house for 25 years, no more mortgage. Makes retirement funds go a lot further.

I am in similar shoes. I have been in mine for 21 years. Plan to be taken in a gurney.

I don’t get how folks don’t see owning better than renting.
After 15 years all I now pay is taxes and insurance as no longer have a mortgage.
If I were to rent in my neighborhood (a comparable home), rent would be over $3,500 per month and in contrast I pay $750.
Also, house now worth well over 2.5 x’s what I paid.

[2Redbulls]

I'm more than happy to rent anyone one of my places and take your money. Owning real estate for me has been the best investment I ever made.

[Rockrolex]

Originally Posted by 1st amg

I am in the real estate management/property management for multi residential, ie apartment buildings. We have tenants coming to us getting out of home ownership because, they make one payment for the month....rent. They don't pay for water, they don't pay for hot water, they don't pay for heat(gas). Therefore, they don't have to deal with the increases every year that these utilites throw at you. Then, they don't have to cut the grass or find someone to do it, they don't have to pay for the snow removal of their parking space or lot. There is no bank to deal with for mortgage payments or increases, the insurance is only for apartment insurance which typically is about $50 per month. Then, there is zero money paid out for repairs, such as clogged drains, dripping water faucets, light fixtures or switches, wear and tear for flooring is replaced by us the landlord etc. So, it is a lifestyle choice that works for many. You could also pocket alot of money for your retirement.

I pretty much agree with your assessment. We owned a home for 35 years and moved into a luxury rental building 4 years ago. I still own three other apartments (2 condos and a coop) and I don't need the mortgage deduction of another property. I'm also retired and our rent payment is about 1/2 what our mortgage payments on the house were. Two of our apartments are mortgage free and we travel a fair amount so it's good to just be able to close the door and head out of town, knowing there's someone on the front desk 24/7 who will take in packages while we're away.

[worldfamoussam]

I'm a real estate broker, not a financial advisor, so take this for what it's worth.

It really depends. Home ownership is not for everyone, and it sounds like you may have had some of your family years behind you. You might want to consider owning a condominium, but that depends on your market. I work in an urban market where condos are extremely desirable, and location and fee structure effect the value as much as the physical plant.

If there are no suitable homes for you to purchase and you're comfortable with the finance side of renting, go ahead and continue. You can always buy something if you change your mind later. I like the lifestyle that comes with ownership, but I can see where a house would be a headache for you.

And yes, invested well, stocks, etc tend to do better than housing when you factor in inflation. The fact is that most people (including me) don't have the discipline to invest that way, so a mortgage is "forced savings" and can be a vehicle to help people build wealth over time.

[christianj]

I've typically owned and have made some pretty decent money selling several primary as well as 3 vacation properties (we did a 1031 on those and cashed out on the final sale). In the last 20+ years I've done 9 purchases/sales.

Luckily I have never lost money on any of the sales. I broke even on 2... a vacation house sale shortly before the market tanked in in 2008-2009 near the Delaware Shore and a house I just held on to for 1.5 years when I first took a job in CT. It was meant to be short-term ownership deal as I was sick of paying $2k a month in rent for a tiny apartment in CT so I bought an inexpensive little place near work. Knew I was only going to live there for 1-2 years until we decided to sell our primary residence in MD and then do a full fledged relocation to CT and buy a large house.

Renting is not for me as I feel like I am throwing my money out the door.

[JUSTIFIED]

Originally Posted by worldfamoussam

I'm a real estate broker, not a financial advisor, so take this for what it's worth.

It really depends. Home ownership is not for everyone, and it sounds like you may have had some of your family years behind you. You might want to consider owning a condominium, but that depends on your market. I work in an urban market where condos are extremely desirable, and location and fee structure effect the value as much as the physical plant.

If there are no suitable homes for you to purchase and you're comfortable with the finance side of renting, go ahead and continue. You can always buy something if you change your mind later. I like the lifestyle that comes with ownership, but I can see where a house would be a headache for you.

And yes, invested well, stocks, etc tend to do better than housing when you factor in inflation. The fact is that most people (including me) don't have the discipline to invest that way, so a mortgage is "forced savings" and can be a vehicle to help people build wealth over time.

Sound advice. Perhaps a condo is the way to go. My only issue w/ condo or townhome is that it has some of the negatives of renting (noisy neighbors), but now you're fully committed. Plus, correct me if wrong, but aren't condos and townhomes more difficult to sell?

I believe i do have the discipline to invest the difference. just have to get into the habit of investing a set amount w/ each pay check, which also utilizes the dollar cost averaging strategy.

[123Blueface]

Originally Posted by JUSTIFIED

Sound advice. Perhaps a condo is the way to go. My only issue w/ condo or townhome is that it has some of the negatives of renting (noisy neighbors), but now you're fully committed. Plus, correct me if wrong, but aren't condos and townhomes more difficult to sell?

I believe i do have the discipline to invest the difference. just have to get into the habit of investing a set amount w/ each pay check, which also utilizes the dollar cost averaging strategy.

Owned a Townhouse for 8 yrs., never again.
First, I do as I please in my home, not what a group of Association members wish to dictate.
Second, assessments. When you least expect or have budgeted for it, the letter comes in the mail and usually, not asking for small change.
Third, space, distance, grass in between my home and that of my neighbors and don’t have to say God Bless You, to my next door neighbor while he is in his unit and I am in mine, sitting main my living room, as the walls are so thin.

Was not for my wife and I. If you can deal with all that and then some, go for it.

[Flstfirider]

Originally Posted by JUSTIFIED

We've considered it. Can't recall the name of the high rise complex, but in 2008 it had just finished construction and very nice condos were selling for under $200K (Uptown Dallas). They're now worth $500K+. That would've been a heck of an investment. Timing is everything.

When I moved to TX 9 years ago from the DC area, I never expected home values to appreciate like they did in DC. I paid less and got a lot more house in Frisco (a Dallas suburb). In the last 6 years my homes value has gone up close to 75%...a pretty good return on my investment.

[JUSTIFIED]

Originally Posted by Flstfirider

When I moved to TX 9 years ago from the DC area, I never expected home values to appreciate like they did in DC. I paid less and got a lot more house in Frisco (a Dallas suburb). In the last 6 years my homes value has gone up close to 75%...a pretty good return on my investment.

Yes... Frisco has been a hot bed. Congrats on the nice growth in value.

[Etschell]

no mortgage, yes.

mortgage, no.

that simple.

[KevinP.]

I’ve been in my condo for over 8 years and can’t see myself living in a home either.

Every now and then I look into a bigger condo with a nicer view, but I don’t need it right now. Plus the transaction costs alone will be several nice watches so there goes that.

[tonymil]

It all really depends on one's lifestyle and preferences. Since you mentioned that your kids are fully grown, you don't really have to worry about that anymore. In my case, I am just starting a family and I'm a very sentimental person. I want to create memories in our house and I want my kids to have something to look back and remember it. This is why a house is very important to me. We're planning to purchase one soon from [spam edited]

[4 Aussies]

My goal has always been to create wealth and build equity for myself, not a landlord. Watches and cars should come after the fact, not before. Spending years in an apartment means you leave with nothing, anything can be justified. I guess at the end of the day if you're comfortable in that lifestyle of living under someone else's rules, more power to you.

[BroncoOne]

This is clearly a lifestyle and personal family and financial situation choice.

I have owned 5 homes and built my first one. I have made substantial gains on each one.I have also rented prior to that and I greatly prefer owning as I get to make all of the rules.

As for repairs, when something needs fixing, fix it properly and spend up front for high quality material and you won’t need to touch it again (whatever it is) for decades. This is critical! Save yourself the aggravation by doing it right the first time.

I don’t need to join a gym or go to the cinema because I can do all of that at home. I pay someone to mow the lawns and clear the snow. As a renter, I did too, through the rent that I paid and when I moved, I didn’t take any financial gain with my. My landlord reaped that.

As for repairs when renting, if you have a landlord that prefers to spend as little as possible (if he or she even gets around to doing it), you will suffer the inconvenience of not having whatever it is that is broken, or keeps on breaking and you’ll get a rent increase to cover the landlord’s spend.

Of course, if you don’t have kids at home or pets and want the freedom to just up and move from place to place, renting works fine as long as you like your neighbors. And if you don’t, just move again. It’s a place to live and doesn’t have to be an investment.

[zengineer]

Originally Posted by brandrea

In my opinion, owning a home is a lifestyle shoice, plain and simple. To each their own

This is my feeling. I built my current home 15 years ago on 2 acres and later bought 2 more next to it just to keep it empty. I can't rent the type of property I want to live in and actually enjoy maintaining the property.

I paid it off several years ago and could sell today for significantly more than my cost to build it back then. But as the years go by I expect one day I'll grow tired of the work and at that time I will likely rent a condo but for now the joy of no close neighbors and freedom to remodel as I see fit keep me in the homeowner camp.

If you dread all that comes with buying and ownership by all means stick with renting.

Sent from my SM-G991U using Tapatalk

[brandrea]

Originally Posted by zengineer

This is my feeling. I built my current home 15 years ago on 2 acres and later bought 2 more next to it just to keep it empty. I can't rent the type of property I want to live in and actually enjoy maintaining the property.

I paid it off several years ago and could sell today for significantly more than my cost to build it back then. But as the years go by I expect one day I'll grow tired of the work and at that time I will likely rent a condo but for now the joy of no close neighbors and freedom to remodel as I see fit keep me in the homeowner camp.

If you dread all that comes with buying and ownership by all means stick with renting.

Sent from my SM-G991U using Tapatalk

That looks like an amazing setting. Congratulations on home ownership as well

Much the same as you, we value our open space

20210302_065258.jpg

Sent from my SM-G960W using Tapatalk

[mountainjogger]

Agree. Space and privacy.

[zengineer]

Originally Posted by brandrea

That looks like an amazing setting. Congratulations on home ownership as well

Much the same as you, we value our open space

Attachment 1255442

Sent from my SM-G960W using Tapatalk

That's a great view. I built a single story ranch and since we have basements in Michigan that means an equal amount of space to play with...or just accumulate junk in. We did the latter for 19 years and I finally cleaned it up and made it useful.



Sent from my SM-G991U using Tapatalk

[JasoninDenver]

Nice revival of a very old thread.

I wonder how much the OP would have gained had he pulled the trigger on the home in 2018. Over the same time frame, my home in Denver is up 45% and my mountain townhome is up 60%.

Sadly, we are not selling yet. A gain isn't a gain until its taken. We will certainly have a correction in the next couple of years yet, unless we have a grossly atypical correction, our values wont drop more than 20-25% from the highs. If it drops more, it probably means we will be having a llot more problems as well.

When we do start divesting, we will probably sell the big Denver house and may rent a small condo for a couple of years while my wife continues working. Our mountain home will then become our primary residence.