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

[Guru]

Good points from both sides

 

[BezO]

I probably won't own my primary residence again until I can afford to buy my dream home puttin' 75%+ down. I will continue to invest in real estate though.

I'm sure it's been mentioned, but it also depends in which market you're talkin'. The markets I'm most familiar with, NY & DC, nah, you came up if you owned & watched that equity grow. And rents higher than a MF.

 

[dora_da_destroyer]

Don’t be a condescending a$$hole dude.
Most of my investments are in my 401-K which is highly diversified.

Let’s also not act like recessions don’t wipe out home values as well.

Third, in the case of a downturn, I’ll just keep buying more for cheaper. I’ll regain my losses at some point.

what about my post was condescending? you're obviously looking to be offended. if you're mad about the 401k comment, it's the truth - BTW, when you were talking about investments i assumed you were investing in a brokerage account or IRA, so that wasn't a jab at you. most americans dont know how to invest and 401k's aren't the best investment vehicles - usually high fees on those funds, and depending on the employer, can be a very limited set of funds.

and no one was saying recessions don't hurt home prices, but they usually don't see mass losses they way a stock market can/would. that's what made 2008 so devastating, home prices bottoming out in a way that's not natural for a recession and how that blew up all the companies that were attached to the predatory or shytty mortgages they gave out. lastly, you missed my point about multi family...those are a lot more recession proof for multiple reasons.


edit: and your point about regaining losses applies to homes as well....

 

[Zero]

This seems like more about you shytting on ppl that told you, you were throwing away money renting vs you actually trying to spread some usable knowledge.

I could be wrong tho...

That's all it is. Breh couldn't even be bothered to tell us where he's located and what he's exactly paying to make it work until this post.

Another one of those "you need to invest your money" types.

"Invest in what exactly, and whats your ROI? "

"Just do it breh "

 

[Wink Beaufield]

I probably won't own my primary residence again until I can afford to buy my dream home puttin' 75%+ down. I will continue to invest in real estate though.

I'm sure it's been mentioned, but it also depends in which market you're talkin'. The markets I'm most familiar with, NY & DC, nah, you came up if you owned & watched that equity grow. And rents higher than a MF.

A lot of my fam bought houses here in DC back in 1999-2000 right before the gentrification wave hit the city. Some of them are millionaires now because they got spots on Capitol Hill or houses within pissing distance of metro stations. Hell I bought my house here in SE DC back in 2015 and the value of it done shot up by $100k.

 

[NaijaProdigy Redux]

Just invest in multiple asset classes.

I have my place in the city but multi-family Tier B and C apartment buildings is where I’ve parked a lot of money.

 

[Seoul Gleou]

why not do both.

own a property, rent it out to pay down the mortgage and build equity. essentially the renter is paying your mortgage

meanwhile, your personal income goes towards the place you're renting and simultaneously saving and investing.

it's not necessarily one or the other

 

[-DMP-]

In 8 years I’m trying to have at the very least 5-6 doors cash flowing if not more. Goal is to own small apartment complexes and multi family properties before 40.

 

[Mordith]

My mortgage, taxes, insurance and HOA are about $200 less than I could rent a comparable property for, and my home value has appreciated about 70k in direct comps over the 2 years I have owned it. Show me another investment that can match my return thus far.

 

[keond]

My mortgage is about 500 less than the average rent in my area and my house was completely renovated and new

 

[keond]

My mortgage, taxes, insurance and HOA are about $200 less than I could rent a comparable property for, and my home value has appreciated about 70k in direct comps over the 2 years I have owned it. Show me another investment that can match my return thus far.

Most of these nikkas done even know what escrow is. Let them sleep.

 

[ahomeplateslugger]

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.

a few things..

i think most ppl have recency bias when it comes to the stock market. the market has been on a huge run since 2010 and the feds are cutting interest rates and pumping money into the market to keep it up. ppl saying there will be a dip in the housing market but forget that there will be a even bigger dip in the stock market so that cash will end up disappearing, unless you liquidate before the dip of course.

i don't know what city you are in, but a mortgage is typically cheaper than paying rent. when i was renting my 2 bedroom condo out i was getting $2,100 while my mortgage was $1,700. that $400 swing was nice and the condo was already renovated so there were no major repairs or fixes i had to do.

and most importantly buy within your means. i don't like paying the minimum on my mortgage even tho my interest rate is 3.6% on a 15 year mortgage so buy a spot and do the math to determine your break even point. i see folks who get 30 year mortgages and they refinance to take money out of their house and end up adding an extra 5+ years to their mortgage. if you are financially literate then taking on a mortgage and owning a house is a great choice.

at the end of the day it comes down to your lifestyle and goals. i don't regret buying my condo one bit and wish i had bought one sooner actually. i wish i was working from 2008-2010 because i would've bought a couple of houses/condo for what they were going for in the bay area. i'm hoping there's a big pullback in a few years because i would love to buy another property, preferably a duplex or SFH.

just my .02.

 

[ahomeplateslugger]

My mortgage is about 500 less than the average rent in my area and my house was completely renovated and new

yeah i'm not sure where OP is living but i posted my mortgage is $400 less than what ppl are renting for. and my mortgage includes property tax, HOA and insurance. 15 years from now you'll back at your house and be glad you bought it.

 

[Deuterion]

You’re contradicting yourself in your statement; you can’t agree with my point then backpedal and start talking about alternate points or reasons as to why or why not you’d buy a house.

it’s either my point is correct in assumption or you’re trying to make a different argument on a different case. I said from the beginning you can look at it as an investment if you have certain things going for yourself in life. That point stands.

if you don’t, then my thoughts don’t apply

makes me wonder why people even both quoting my responses if you didn’t bother to read everything I wrote...

I'm not the original poster you were responding to FYI. All I'm saying is that the guidance of a Single Family Home being an investment is flawed. A person HAS TO MAKE a home an investment and your post of using it for short-term rentals via AirBnB is a perfect example of doing so. So to summarize, I agree with you and I am not backpedaling. A house in itself is not an investment, but you can make it an investment by renting or selling it but that takes looking at it as a business and not as a place of residence.

 

[GnauzBookOfRhymes]

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.

Buying is not for everyone. Also depends on where you are, the market conditions, your financial capabilities, what you want in life etc..

But the bolded is incorrect.