Renting and reinvesting the savings from renting, will outperform owning and building equity

[Robbie3000]

Owning a multi unit building that pays for itself and puts profit in your pocket >>> whatever you hollering about in OP

Eh, it’s not that black and white either. I belong to an investment group and our target is a multi unit apartment building. we were looking at 10-15 unit buildings. It’s four of us and we have 90K in down payment money. So far all the deals we have looked at don’t seem to have the same rate or return that we would get if we all just invested the down payment in the stock market.

 

[dora_da_destroyer]

Eh, it’s not that black and white either. I belong to an investment group and our target is a multi unit apartment building. we were looking at 10-15 unit buildings. It’s four of us and we have 90K in down payment money. So far all the deals we have looked at don’t seem to have the same rate or return that we would get if we all just invested the down payment in the stock market.

One, of course it’s not that black and white. Two, if a down payment on a 10-15 unit building is only 90k, I can only imagine where it is and why the ROI is low. Secondly, your return in stock is still being degraded by inflation while, barring a big bottoming out of your neighborhood, cash flow from real estate will reflect real dollars, inflation increases what you can charge for the units, and in most places, allowable increases exceed inflation.

 

[Ezekiel 25:17]

Until the rent goes up and you can't afford to live there

 

[NkrumahWasRight Is Wrong]

If you cant avoid PMI then dont even bother

Saying renting is better than buying with 5 down is meaningless

 

[ThaBronxBully]

edit: Nevermind, I Misread The OP

 

[Standing on business]

Way to many variables

 

[Ezekiel 25:17]

Just realizing mortgages are scams...
Or maybe scam isnt the right word...
But some other muthafukaz are definitely eating off of the "American dream" bullshyt...
And it ain't us

How is a mortgage a scam? You usually paying less than what people are renting. In 15 years the house is yours, all you gotta do is pay the $150 property tax. Where can you live where rent is $150?

At the end of day Property>>>>>>>>Imaginary Numbers

 

[ThaBronxBully]

If you cant avoid PMI then dont even bother

Saying renting is better than buying with 5 down is meaningless

I Used To Think This But It’s Not Necessarily The Worst Thing, Of You Can Put At Least 10% Down PMI Is Like An Extra 40-70 Bucks A Month For 2 Years

Obviously It’s Better To Avoid It Though

 

[SleezyBigSlim]

Cacs like Vlad are pushing renting over home ownership so you don't actually have any assets to pass down. Don't be naive.

 

[NkrumahWasRight Is Wrong]

I Used To Think This But It’s Not Necessarily The Worst Thing, Of You Can Put At Least 10% Down PMI Is Like An Extra 40-70 Bucks A Month For 2 Years

Obviously It’s Better To Avoid It Though

Still, that adds up.

With that said, of course almost anything can work given certain circumstances. Unless we're talking actual numbers here then its all hypothetical.

OP was talking about saving on rent compared to 5% down. Didnt say anything other than "expensive market". So if hes talking houses at like 250k plus compared to say 1.2k rent then yeah hes right

 

[playplayaj]

Anywhere with low rent in my area is the hood. Anywhere considered luxury is about 1600 for a 2 bedroom and almost 2k for 3 bedrooms. My mortgage is 1300 and my interest rate is 3.2%

 

[Mensch Fontana]

My mortgage cost as much as when I was renting. And my property value increased 20%. And and I'm about to refi to a lesser interest rate. So I guess I lost according to OP.

 

[Robbie3000]

One, of course it’s not that black and white. Two, if a down payment on a 10-15 unit building is only 90k, I can only imagine where it is and why the ROI is low. Secondly, your return in stock is still being degraded by inflation while, barring a big bottoming out of your neighborhood, cash flow from real estate will reflect real dollars, inflation increases what you can charge for the units, and in most places, allowable increases exceed inflation.

Meh...You are assuming a lot. But that’s not the subject of this thread though so we’ll just table it for now.

 

[murksiderock]

Anywhere with low rent in my area is the hood. Anywhere considered luxury is about 1600 for a 2 bedroom and almost 2k for 3 bedrooms. My mortgage is 1300 and my interest rate is 3.2%

Where do you live? Because you can definitely rent 2 and 3 bedrooms in The Beach in good areas for less than $1600/month...

 

[Cynic]

In an expensive market, you should continue renting until such a time rent is higher than the mortgage payments.

This is the strategy I’ve been using over the past few years. People laughed at me for “wasting” my money renting, but In eight years, I calculate I will have enough to put down 50% towards the place if I choose.

Meanwhile, if I had bought a place with no money down or 5% money down, in 15 years most of my mortgage would still be going towards the interest and wouldn’t have made a dent in the principal.

Mortgages are scams if you can rent the same place for cheaper.


Speak on it.

If you bought with no money down or 5% then why not use seller financing and skip the mortgage all together ?

House hack the other rooms and live rent free from now until eternity