Renting Vs Buying
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Yes, but buying a house - you are receiving shelter that you will eventually OWN verses never owning the shelter you are renting.A home, that is.
What are your opinions, guys? I'm undecided and always hear "renting is dead money". Any insights?
totally depends on your financial situation/family/lifestyle etc etc etc
No doubt! For some people, renting makes the most sense.
That's like saying "paying for utilities is a waste" or whatever. You are receiving *SHELTER* for a fee. It's not a waste. Homeownership comes with a lot of negatives, making it a non-option for some people.
With utilities it is different - because you will never own those services.
But if you do not *want* to own a home, then it makes sense to rent. Like I said, there are a lot of negatives associated with it. For one, you have to pay taxes on it every year (which shows that you don't actually *own* it, because the government can take it from you) as well as maintenance costs that you don't have with a rental. Overtime, it's cheaper to rent and much more flexible.
If you want to own a home for the sake of owning it, then fine. But it's not worth the investment for some people. It's like buying vs. leasing a vehicle. Sometimes a lease makes more sense. But some people would rather own it.0 -
Saying that overall, it is cheaper to rent, doesn't really make sense.
Yes, but buying a house - you are receiving shelter that you will eventually OWN verses never owning the shelter you are renting.A home, that is.
What are your opinions, guys? I'm undecided and always hear "renting is dead money". Any insights?
totally depends on your financial situation/family/lifestyle etc etc etc
No doubt! For some people, renting makes the most sense.
That's like saying "paying for utilities is a waste" or whatever. You are receiving *SHELTER* for a fee. It's not a waste. Homeownership comes with a lot of negatives, making it a non-option for some people.
With utilities it is different - because you will never own those services.
But if you do not *want* to own a home, then it makes sense to rent. Like I said, there are a lot of negatives associated with it. For one, you have to pay taxes on it every year (which shows that you don't actually *own* it, because the government can take it from you) as well as maintenance costs that you don't have with a rental. Overtime, it's cheaper to rent and much more flexible.
If you want to own a home for the sake of owning it, then fine. But it's not worth the investment for some people. It's like buying vs. leasing a vehicle. Sometimes a lease makes more sense. But some people would rather own it.
Cheaper month to month? Not neccessarily depends where you live.
but in the long run, it is like comparing apples to oranges. You can pay X amount of dollars to buy a house and pay for it for 30 years. Or you can pay X amount of rent to live somewhere. Two totally different things.0 -
Saying that overall, it is cheaper to rent, doesn't really make sense.
Yes, but buying a house - you are receiving shelter that you will eventually OWN verses never owning the shelter you are renting.A home, that is.
What are your opinions, guys? I'm undecided and always hear "renting is dead money". Any insights?
totally depends on your financial situation/family/lifestyle etc etc etc
No doubt! For some people, renting makes the most sense.
That's like saying "paying for utilities is a waste" or whatever. You are receiving *SHELTER* for a fee. It's not a waste. Homeownership comes with a lot of negatives, making it a non-option for some people.
With utilities it is different - because you will never own those services.
But if you do not *want* to own a home, then it makes sense to rent. Like I said, there are a lot of negatives associated with it. For one, you have to pay taxes on it every year (which shows that you don't actually *own* it, because the government can take it from you) as well as maintenance costs that you don't have with a rental. Overtime, it's cheaper to rent and much more flexible.
If you want to own a home for the sake of owning it, then fine. But it's not worth the investment for some people. It's like buying vs. leasing a vehicle. Sometimes a lease makes more sense. But some people would rather own it.
Cheaper month to month? Not neccessarily depends where you live.
but in the long run, it is like comparing apples to oranges. You can pay X amount of dollars to buy a house and pay for it for 30 years. Or you can pay X amount of rent to live somewhere. Two totally different things.
I see it as the cost of sheltering my family. We have owned before, and it was always a surprise cost. Running the numbers, we have been better off this past decade by paying rent for shelter, vs. paying a mortagage, insurance, taxes, maintenance/repairs, etc.
To say it is *always* better to rent or own for all people is not true. It depends on the person, on your goals, on the market and where you live, etc. There are a lot of variables.
I'm just saying that it's silly to claim that paying for shelter is a waste. Shelter and food are the two things that all humans need.0 -
I guess I just don't see buying a house the same as paying for shelter.
Saying that overall, it is cheaper to rent, doesn't really make sense.
Yes, but buying a house - you are receiving shelter that you will eventually OWN verses never owning the shelter you are renting.A home, that is.
What are your opinions, guys? I'm undecided and always hear "renting is dead money". Any insights?
totally depends on your financial situation/family/lifestyle etc etc etc
No doubt! For some people, renting makes the most sense.
That's like saying "paying for utilities is a waste" or whatever. You are receiving *SHELTER* for a fee. It's not a waste. Homeownership comes with a lot of negatives, making it a non-option for some people.
With utilities it is different - because you will never own those services.
But if you do not *want* to own a home, then it makes sense to rent. Like I said, there are a lot of negatives associated with it. For one, you have to pay taxes on it every year (which shows that you don't actually *own* it, because the government can take it from you) as well as maintenance costs that you don't have with a rental. Overtime, it's cheaper to rent and much more flexible.
If you want to own a home for the sake of owning it, then fine. But it's not worth the investment for some people. It's like buying vs. leasing a vehicle. Sometimes a lease makes more sense. But some people would rather own it.
Cheaper month to month? Not neccessarily depends where you live.
but in the long run, it is like comparing apples to oranges. You can pay X amount of dollars to buy a house and pay for it for 30 years. Or you can pay X amount of rent to live somewhere. Two totally different things.
I see it as the cost of sheltering my family. We have owned before, and it was always a surprise cost. Running the numbers, we have been better off this past decade by paying rent for shelter, vs. paying a mortagage, insurance, taxes, maintenance/repairs, etc.
To say it is *always* better to rent or own for all people is not true. It depends on the person, on your goals, on the market and where you live, etc. There are a lot of variables.
I'm just saying that it's silly to claim that paying for shelter is a waste. Shelter and food are the two things that all humans need.
Renting a home - yes that is paying for shelter.
Buying a house is buying a house. Yes, you are providing yourself with shelter while living in the home you bought/are paying for, but in the long run - you will own something.
Again, two different things.0 -
Dont forget the emotional attachments either.
Yes, we are currently talking strictly numbers here but, if I do it right, my grandchildren will come to my house and I can show them the tree that their Daddy built a fort in.
There are things other then the wallet that matters.0 -
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>.0 -
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.
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>.0 -
Like the economy and the stock market there are times when renting is beneficial and times when owning is also beneficial.
If you had sold a house before crash in 2006 and rented, you'd be way ahead. Buying houses now seems to be a good time to do so. IE: Low interest rates, and deflated housing prices. The problem here is that it is a gamble.
Emotionally, owning feels better, but if you lose a job or something like that, it can be devastating.
I probably wouldn't buy unless I was planning on staying in that community for 15-30 years and had a job where I thought i could grow.
There are those that say it pretty much comes out even in the end after you pay upkeep and remodel 2 times in 30 years.0 -
A lot of it comes down to if you have the intention of staying there for a period of time or not. If within a few years you think you'll be ready to move either for a bigger place, relocation for a job, or whatever your reason may be then you'll be just as well off renting. Overall there's alot of different factors that play in to whether or not renting or buying is best, and I would say it's based on the individual themselves.
As far as down payments go 20% is usually required but with my first house I was able to get a 0% down payment loan. If I'm not mistaken it was called an RHA loan that you can get as a first time home buyer. There are some stipulations and I think it requires more paperwork from the loan officer so it's unlikely they'll mention it to you, you may have to ask about it.0 -
I guess I just don't see buying a house the same as paying for shelter.
Saying that overall, it is cheaper to rent, doesn't really make sense.
Yes, but buying a house - you are receiving shelter that you will eventually OWN verses never owning the shelter you are renting.A home, that is.
What are your opinions, guys? I'm undecided and always hear "renting is dead money". Any insights?
totally depends on your financial situation/family/lifestyle etc etc etc
No doubt! For some people, renting makes the most sense.
That's like saying "paying for utilities is a waste" or whatever. You are receiving *SHELTER* for a fee. It's not a waste. Homeownership comes with a lot of negatives, making it a non-option for some people.
With utilities it is different - because you will never own those services.
But if you do not *want* to own a home, then it makes sense to rent. Like I said, there are a lot of negatives associated with it. For one, you have to pay taxes on it every year (which shows that you don't actually *own* it, because the government can take it from you) as well as maintenance costs that you don't have with a rental. Overtime, it's cheaper to rent and much more flexible.
If you want to own a home for the sake of owning it, then fine. But it's not worth the investment for some people. It's like buying vs. leasing a vehicle. Sometimes a lease makes more sense. But some people would rather own it.
Cheaper month to month? Not neccessarily depends where you live.
but in the long run, it is like comparing apples to oranges. You can pay X amount of dollars to buy a house and pay for it for 30 years. Or you can pay X amount of rent to live somewhere. Two totally different things.
I see it as the cost of sheltering my family. We have owned before, and it was always a surprise cost. Running the numbers, we have been better off this past decade by paying rent for shelter, vs. paying a mortagage, insurance, taxes, maintenance/repairs, etc.
To say it is *always* better to rent or own for all people is not true. It depends on the person, on your goals, on the market and where you live, etc. There are a lot of variables.
I'm just saying that it's silly to claim that paying for shelter is a waste. Shelter and food are the two things that all humans need.
Renting a home - yes that is paying for shelter.
Buying a house is buying a house. Yes, you are providing yourself with shelter while living in the home you bought/are paying for, but in the long run - you will own something.
Again, two different things.
With renting, you are fulfilling a need. With ownership, you are assuming a responsibility. Some people would rather not have that responsibility.0 -
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.
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>.
I can't honestly say I know about all areas of Texas, but in the SE Houston area, my daughters' 2,200 sf home on 1/3 acre is $4,000 yr. I have yet to see listings in this area that didn't have property tax as well. Whether that's the case for the entire state? I've never honestly researched outside this area.0 -
I agree with BeachIron. It depends on your situation. Are you going to live there for a while? What kind of housing market are you in? Will you want to make changes to the house? What will you be paying in taxes if you buy? Are the taxes likely to increase? I did a re-fi last year which knocked my mortgage down $100/month only to have the taxes go up by that much this year!0
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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.0 -
There is an old saying....Buy land. They aren't makin any more of it.0
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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.0 -
I think buying is a great option if you can afford a down payment (ideally at least 10-20%) and plan on staying in the house for at least 7-10 years. If you see yourself moving in less than that time frame, I would say renting is a better option. If you get a 30 year mortgage and pay it for less than 5 years and then decide to sell, you will have built up very little equity as the majority of your monthly mortgage payment goes towards interest. Not to mention, it can be difficult to sell a house quickly in this economy.
Dave Ramsey gives a lot of great advice about buying vs renting http://www.daveramsey.com/articles/article/articleid/the-truth-about-real-estate/category/lifeandmoney_realestate/
great advice and i'm glad I came across this post.
a lot of ppl ask me the same thing, but I don't feel I should buy unless I know I will live in the house for an extended amount of time and have job security. i'm not at that point of my life yet so I rather rent.
also someone mentioned about having the freedom to just call the landlord and get things fixed which is a major plus for a single girl who is renting.
of course when I am married and have a family I will be wanting a home, but for now i'm quite happy where I'm at.0 -
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.
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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.0 -
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.
I did not buy either as rental property. Both were my primary residence at one point. Also, there are certainly times when renting is the best and maybe only option. I was just out of college once, and wasn't always in a situation where I could afford to buy a house. But, the point is if you think you aren't paying property taxes and maintenance because you're renting, that is just not true. You are paying all that plus more.
On the other hand, I could live in an apartment for 40 years and hope I was able to save enough cash in my 401k to retire and continue to pay rent in retirement. Rent vs buy definitely depends on the situation. Just trying to point out the advantages to purchasing.0 -
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.
I did not buy either as rental property. Both were my primary residence at one point. Also, there are certainly times when renting is the best and maybe only option. I was just out of college once, and wasn't always in a situation where I could afford to buy a house. But, the point is if you think you aren't paying property taxes and maintenance because you're renting, that is just not true. You are paying all that plus more.
On the other hand, I could live in an apartment for 40 years and hope I was able to save enough cash in my 401k to retire and continue to pay rent in retirement. Rent vs buy definitely depends on the situation. Just trying to point out the advantages to purchasing.
......unless you are renting from an individual and your rent payment is much lower than the normal market rate.
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