Is homeownership worth it? Right now i live in shitty apartments.
I hate the idea of being in debt for 30 years to pay off a house.
But at the same time Im saving about $1k to $1.5K a month and money is just sitting in bank
it would take 8-12 years to save up enough to buy a house in cash, and in those 8-12 years home prices would inflate
it seems like a losing battle either way, where do i move forward from here?
saving up to buy in cash would be stupid considering all that money you are spending on rent could go to your mortgage
Unless you are in a city with absurdly high housing costs and absolutely for some reason cannot live outside it and commute in, getting a house is always better. There's very little instances outside of cities where renting is better because while you lose a little money on the loan, you keep the equity. The only other problem is you cannot sell the house instantly, if that matters to you. You should also know about property taxes in your area but the absolute worst is 2.5% per year. Either way, it's retarded to actually pay only the minimum payment on the loan.
I'd agree with this except for the last part. You should always just pay the minimums on fixed rate debt like mortgages and instead out the extra cash into investments.
Thanks for this thread. I've been saying money to buy in cash as well, and now I'm wondering if I should use it to buy a place as an investment property, since I'm not ready to move yet.
To be honest buying a house is a bad investment. Houses and mortgages are liabilities not assets. Especially suburb developer-built houses made of stapled together particle board.
Major rip-off. In 30 years your house will probably be a slum ghetto shithole and the house a toxic falling apart mold farm.
If you want to invest in real estate buy inner city properties or rural farm/ ranchland. Live there or not. Suburban development is a racket conducted by firms better knowledgeable in the market than you.
If 2008 did'nt demonstrate what a shit investment the typical home is I dunno if you don't deserve the punishment you'll recieve if you go that route.
Here's the homebuying guide:
> Do I want to live in ________ for 5+ years
> Can I put 20% down
> Do I have stable income and savings
> Can I get a good deal on a home (is the market high or low)
> Am I cool with some of the bullshit of owning a home (lawn care, home maintenance, taxes, pest control)
If you answered yes to all the above questions, then yeah.
I was really torn this year to buy or not. I ended up just renting an apartment. Why? For one the market is inflated as fuck right now. For two I don't want to deal with the homeowner bullshit as a single guy.
I think the biggest factor many homebuyers don't consider is how much the property taxes and loan interest fuck you. At the end of a 20 year span you do save a substantial amount of money, but you put up with a LOT of bullshit.
The time to get a home, for most people, is when you get married and have kid(s).
lol nigga, you pay rent that is the same as having a mortgage, you just have 0 % to get your money back. think about it
>pay rent
>live somewhere
>leave 0 value in your pocket
>become broke
>live on street all the years of rent wasted
Now if you own a house
>pay mortgage
>actually own something more and more every month/year
>can sell it later
>if you go broke
>you're on the street if you havent paid it off but that is the fucking same as paying rent
I live in Sweden which is in a completly crazy housing bubble right now, and by my own gut feeling and projections, it should pop within 4-5 years which is perfect since that I'm gonna start university next year and housing prices will be extremly cheap as i graduate
It all depends on your situation man, it's not black and white. Do some calculations, what option makes you lose more money and act accordingly
It's a big investment to make, probably your biggest one in life, so make sure it actually pays off
Real estate professional here. This guy gets it. The new home products built post 2005 are absolute shit. The lumber is so young-growth pine, termites will rip thru that shit in days. Stay away from Tract subdivisions. Always spend more on the land vs the improvements, land doesn't depreciate.
Nobody who is contemplating buying a house ever intends on going "broke". What are you, 12?
I got a home and said yes to all but one...
I wasn't able to put 20% down. Sucks too. Wish I could do it all over.
>Housing bubble
>Europe
Expect a soft landing at best. You have all learned from your mistake.
PS by your projections you won't be fit to buy a house for over 10 years at which point the market will be back up.
People in the most advantageous position right now are mid 20s couples with their deposit saved up and mortgage approval. Everyone else is wasting their time.
Nobody ever intends on going broke, yet they do. That was just to illustrate the shittiest scenario. And i would like to inform you that i am 12 and a half in 3 weeks.
Read this book
You can find free pdf online
But trust me it's worth it
>Is homeownership worth it?
Where do you live?
>I hate the idea of being in debt for 30 years to pay off a house.
Then pay it off faster
If you know that you will live in the same area for 10+ years you might aswell get into the housing market even if its a little overinflated. Housing prices are pretty much a safe investment seen over many years.
>He thinks the scandinavian housing prices will fall too "extremly cheap"
Top kek mate.
>buy home
>have to pay off mortgage
>huge pain in the ass if something big happens and you want/have to move
>put your entire money into a single asset that can be fucked by taxes, other laws, "diversity neighbourhood projects" or just the city going to shit
Alternative:
>put your money into a diversified portfolio
>have to pay rent, but at least youre not in debt
>free to move when you feel like it
>much less risk of losing a huge part of your investment because you are diversified
Everyone I talk to is all about "muh home ownership", but it doesnt seem like such a good deal to me.
Still thinking really hard which way Im gonig.
Mind you, Sweden is a different case since we weren't hit hard by the 08-09 economic crisis
We are the only country in Europe who will suffer extremly hard from this upcoming recession
Home ownership is hard to beat. The average homeowner is wealthier than the average renter.
And if you hate the idea of a mortgage, you're still paying one if you rent. It's just not yours.
Homeownership gives its own kind of freedom.
Where as renting has more immediate freedom, its also the biggest holes in your wallet that drains every month.
it is an investment like any other that should be judged against others
I hate where i live now so I plan to move within 5 years, only reason i have not bought a house
Paying rent sucks, but I think paying a mortgage and property taxes to live in a house owned by your bank for 20 years is worse. Then you own a house you may or may not be able to sell for anything close to what you paid for it.
With renting you can leave whenever you want for the price of a security deposit.
What people don't get is that suburb tract housing is more like a mass produced consumer product like a car or truck that depreciates in value rather than an actual 'investment'. It straddles the line.
your primary residence is NOT AN INVESTMENT
this, although land can appreciate, so you can argue that it may make a return but that doesn't warrant considering it an investment
I just see so much speculation and desperation in housing. very little value buying going on. coupled with a 30 year bet and a max. 5 year fixed rate here in canada it is not a wager I would take. then consider all the low down payments--wouldn't take much of a drop to wipe out the equity on those mortgages. presuming the us raises rates next week, the CAD$ will drop even further, causing higher cost of living up here, plus new carbon tax, etc.
tldr the people I see buying houses are NOT people doing math.
Well said.
How is it not? You do know you can sell it at a later time when house prices go up
Looks like a spooky time to buy into real estate. Unless you plan on doing the whole family thing there are way more diversified portfolios that actually give you some freedumb, not lock you down into an enormous debt that could get larger with rising interest rates, could even turn into an inescapable debt for many soon.
In the US, most mortgages are fixed for the life of the loan. With inflation looming and rates still low, it's an excellent time to buy
You're kinda dumb desu
Excellent argument you really made your point
I was hoping you'd figure it out yourself. I don't owe you an explanation to my opinion