Renting Vs Buying

I want to move to Texas, no property taxes!

I'm not sure where you got the impression that there are no property taxes in Texas, but you'd be mistaken. There is no state income tax, but there is a higher than average sales tax, and definitely a property tax <albeit, still lower than many areas>.

that's weird - I remember researching homes a few years ago and I'm like 99% positive that we read there was no property tax or income tax in Texas.

When I was younger the prevalent thought was buying was best. However, if one takes into consideration the costs often overlooked in buying (taxes, maintenance, remodeling,insurance, etc), then what happens over a lifetime is people only THINK they make money on buying. The added value of real estate ends up simply being a "REBATE" of those overlooked expenses. It might have been better to use the money one spent on those overlooked expenses on investments that returned a premium.

If you are weighing the pros and cons then don't forget to consider ALL OF THE COSTS of home ownership.

Good luck.

When I was younger the prevalent thought was buying was best. However, if one takes into consideration the costs often overlooked in buying (taxes, maintenance, remodeling,insurance, etc), then what happens over a lifetime is people only THINK they make money on buying. The added value of real estate ends up simply being a "REBATE" of those overlooked expenses. It might have been better to use the money one spent on those overlooked expenses on investments that returned a premium.

If you are weighing the pros and cons then don't forget to consider ALL OF THE COSTS of home ownership.

Good luck.

I own 2 homes that are rented out and live in an apartment that I am renting. I can assure you that my apartment is owned by a corporation that is in business for the sole purpose of making money. ALL THE COSTS (taxes, maintenance, insurance) plus some profit are passed on to me in the form of my rent. While there are definitely situations that call for renting, I would much rather own my house.

I am glad to own the 2 houses that I already have and don't intend to rent too much longer. Regarding my rental properties, I look at it like someone else is buying a house for me. One day I will either retire and sell them both or keep them and have a steady monthly income in retirement.

When I was younger the prevalent thought was buying was best. However, if one takes into consideration the costs often overlooked in buying (taxes, maintenance, remodeling,insurance, etc), then what happens over a lifetime is people only THINK they make money on buying. The added value of real estate ends up simply being a "REBATE" of those overlooked expenses. It might have been better to use the money one spent on those overlooked expenses on investments that returned a premium.

If you are weighing the pros and cons then don't forget to consider ALL OF THE COSTS of home ownership.

Good luck.

I own 2 homes that are rented out and live in an apartment that I am renting. I can assure you that my apartment is owned by a corporation that is in business for the sole purpose of making money. ALL THE COSTS (taxes, maintenance, insurance) plus some profit are passed on to me in the form of my rent. While there are definitely situations that call for renting, I would much rather own my house.

I am glad to own the 2 houses that I already have and don't intend to rent too much longer. Regarding my rental properties, I look at it like someone else is buying a house for me. One day I will either retire and sell them both or keep them and have a steady monthly income in retirement.

Buying a house as rental property is not comparing apples with apples. Someone else IS paying the mortgage.

When I was younger the prevalent thought was buying was best. However, if one takes into consideration the costs often overlooked in buying (taxes, maintenance, remodeling,insurance, etc), then what happens over a lifetime is people only THINK they make money on buying. The added value of real estate ends up simply being a "REBATE" of those overlooked expenses. It might have been better to use the money one spent on those overlooked expenses on investments that returned a premium.

If you are weighing the pros and cons then don't forget to consider ALL OF THE COSTS of home ownership.

Good luck.

I own 2 homes that are rented out and live in an apartment that I am renting. I can assure you that my apartment is owned by a corporation that is in business for the sole purpose of making money. ALL THE COSTS (taxes, maintenance, insurance) plus some profit are passed on to me in the form of my rent. While there are definitely situations that call for renting, I would much rather own my house.

I am glad to own the 2 houses that I already have and don't intend to rent too much longer. Regarding my rental properties, I look at it like someone else is buying a house for me. One day I will either retire and sell them both or keep them and have a steady monthly income in retirement.

I would never rent from a big corporation. I've had much better luck with individuals that I know and trust.

If you have the means to buy, then buy. Renting, all you are doing is giving your money to someone else to pay off their mortgage. Buying a house, you are putting money back into your own pocket with equity. Even if you buy something small first, then sell, and go bigger. Renting is basically for people who can't afford a down payment. Sometimes renting is almost the same as a mortgage!!!

I understand that. It seems to create a bit of a vicious cycle too. I mean, what if you can't afford to buy, but due to paying rent can't afford to put money away in order to buy in the future?

If you have the means to buy, then buy. Renting, all you are doing is giving your money to someone else to pay off their mortgage. Buying a house, you are putting money back into your own pocket with equity. Even if you buy something small first, then sell, and go bigger. Renting is basically for people who can't afford a down payment. Sometimes renting is almost the same as a mortgage!!!

Not true. As a single mother I prefer renting bc if something goes wrong I don't have to fix it. I call the landlord and he takes care of it. I may be able to buy for less but not having the hassel of upkeep is a better peace of mind right now.

This is a biggie. I bought a house and, even with the proper insurance, I was out a few thousand dollars when a pipe went bad and flooded four rooms in two floors. Then the stove bought the farm and had to be replaced. Replacing the front door cost me $2300. Bringing the railings up to safety codes set me back about $3000. Now the dishwasher pump has failed so it has to be replaced. My garage door has started trying to jump its tracks. And the asphalt driveway is STILL in the badly cratered condition it was in when I bought the house in 2010, so I'm looking at the costs to get that fixed. There is a potentially large maintenance cost associated with owning a home.

Personally, I don't feel too bad about it because I do have the money and I see it as improving my home. But it does stink when a repair bill drops into my lap that I could have just handed over to the landlord if I was renting.

As others have mentioned, there's also the issue of if you may need to move away. I'm in the military and I will be transferring to a base in another state this summer. Over my career, I can only expect to spend 2 or 3 years in any given location. I fully expect to rent for most of my time in service, especially because I don't want to be stuck with a house I'm not living in. The ONLY reason I bought this house is that it's actually always had good bones (I'm largely just updating original items from when it was built in 1984) and it's in a location that, for many reasons, is the place where I want to retire when I'm done. So if I play my cards right, charging a fair rent while I'm stationed in other parts of the country means I'll only have a few years left on my mortgage.


But it is beneficial to the tenants, too. In exchange for "helping me pay off my mortgage", the tenants get a house that is:

1) not in a hurricane evacuation zone (a big deal in Florida),
2) in a good school district
3) in walking distance of bus lines, a grocery store, a post office, and restaurants, which means you're fine if you don't have a car or cannot drive.
4) larger than many homes in the neighborhood
5) equipped with a 2+ car garage in an area most people only have room for 1 car, if that.
6) repaired and maintained at my expense.

So most of the reasons why I want to keep this house, in my opinion, benefit and apply to the tenants.

This "rent is a waste" idea pushes people into owning at any cost. You don't own your home any more than when you rent, the bank does. I don't see rent as throwing money away, I see it as paying to live where I want and have someone else worry about the pipes bursting in winter.

that might be how you see it, but you are wrong. Renting is throwing money away because that money you are paying isn't putting any equity into anything for yourself. If you mortgage a home and put money into it every month, you are putting equity into it, and if you ever sell it, you can possibly MAKE money. If you rent, you can't make any money when you decide to move somewhere else.