Is buying a home a meme now? Serious question

Is buying a home a meme now? Serious question.

Average home in my area will cost about $1,400 a month with tax and everything. I pay about $980 for a one bedroom apartment which is a little high but 10 minutes to work with traffic.

I work about 45-50 hours a week and I live by myself for now. I clean on the weekend. No yard work. No maintenance. I save about $800 month easily.

I still feel like I'm missing out. Am I stupid for not buying a home or smart? I'm waiting for the next recession to dump all my savings into an index fund once stock prices have tanked.

I have tried to poke holes in my own plan but it just doesn't make sense to buy a home unless it's cash. Everyone tells me, "You need to buy a house!"

Posted this another thread but I wanted to start my own. Buying a home that isn't cash only seems more expensive than just renting.

>I save about $800 month easily.
I'm in a similar situation right now, so have a bump

I was paying $800 for a 2 bedroom nice apartment ~900sqft.

Now I own a 1700 sqft house, at 3.25%, 214k loan. My monthly mortgage + insurance + HoA is $1200 a month. I have solar panels on my roof, and 3 bedrooms I don't know what the fuck to do with(no roommates at the moment).

At 3.25%, it started out at $350 going into principle, now it's nearly $400.

The house is worth whatever the house is worth. I think I could get 250k without breaking a sweat.

This isn't without cost, haven't had any major catastrophes in the house, have to pay for the A/C and other repairs, had to buy appliance when I moved in... but fuck yeah it's worth it. Even I can do the math on this one, and I fucking hate being a homeowner.

Home buying is essentially just taking out a huge loan and investing in one industry. Most people don't seem to understand you could do that with any industry, because most people don't really think that much about investments (which is normal, it's not that interesting to most people).

What's even more ripe is that if your house's principle doesn't rise, you're just paying rent. Rent being the interest rate that the bank charges you + the opportunity cost of the total value of your loan. For every home owner out there, this year they could have instead of a house invested their 300k loan in AMD and gotten a 100% return. Obviously the risk profile is a little different, but there are literally tens of thousands of people who were forced to foreclose in 2008 so it's literally retarded to say housing has low risk.

Implying I could get an unsecured 300k loan at

This and I mean the point is that the average person has to pay monthly living expenses regardless. So it's not nearly the same as extra capital that can be used to invest in stocks

>fuck yeah it's worth it
>I fucking hate being a homeowner

What?

>the opportunity cost of the total value of your loan

No you stupid fuck, it's the OC of your down payment, not your outstanding loan principal. Holy shit you're retarded.

If I buy a house $0 down, I have no alternatives I could have invested in to generate returns. No one is giving you collateral free loans @3.5%.

If I felt the numbers worked in my favor, I'd downgrade to a condo in a heartbeat, but I don't think they do, solar would be unlikely(southwest) combined with the transaction costs involved... I have too much space and no interest in filling it. I have to heat and cool 1700 sqft. I have to maintain 1700 sqft of space.

I don't want roommates, I don't want to manage properties, or to hire somebody to do it for me. I don't believe my house fulfills biggerpockets rental thumbrules for rental units to be profitable, and then I have to move and all that.

My observation is that you're paying rent and the only difference is where the money is going.

I'm just thinking about it terms of real cost and time. I used to have to drive an hour and half minimum back and forth to work. It definitely adds unnecessary stress and it's hard to put a cost to that. Where I live it would cost more to get a home in the same location I am in now.

yep it's this shit again

>in my area

That is probably correct. Meanwhile in my area, a studio apartment is $600 while it's $800 a month for a house with 4 more rooms and 2 more baths. you can get them with small yards like mine which is less than 200 sq feet.

Being a landlord is great because you can make your roommates do everything. each one of mine know more than me about construction for example so it's

>Can you go fix up the porch and repaint it I'll give you $50 off this month's rent

Maintenance is not a negative thing, it's fun because not only do you get semi-paid slaves to do it but you can make your dream home on your schedule and budget.

Next up from rent shits:
>Getting an inspection is impossible (because I've never bought a house before and don't know what it is) so everything in the house will fail
>homeowner's insurance doesn't exist because I have shitty credit so as soon as you buy the house it will burn down
>blah blah blah I have shit credit so there's no way (for my stupid ass) to get a mortgage less than 8%
>blah blah blah I don't know what a car is and won't drive 10 minutes outside the city where the houses aren't all shitty and cost 1/10th as much

That's correct. I'm looking at 11k minimum for a down payment (FHA loan) to purchase something that will cost me more money. I'd rather save the money (which I do already) and put it towards a safe, long term investment.

>What are options
I don't know why I'm still surprised people post here despite not knowing anything about business. AMD Call options are about $1 right now, meaning for 20,000 you could leverage yourself up to 280,000. Again, different amounts of risk, but saying leverage is impossible is simply ignorant

see Also, yes it is the OC of the total investment. Sorry you don't have a firm understanding of Finance

However, with options you lose everything if you're wrong. Sorry, I've played with that fire a couple of times, I'm much more comfortable having the shares and them treading water, than buying an option and not winning the lotto.

Yes, different risk, but again, lots of people lost their homes in 2008, walked away with nothing and were homeless

Okay, I have $0 monies. A bank is willing to give me a house if I pay them $1200 a month. My other option is to rent the exact same house from a landlord for $1300 a month.

Please explain where I can get this magical leverage and opportunity cost derived investment returns with my $0 to negative monies.

They walked away in the exact same situation every renter does. In fact they probably wound up paying less by paying a mortgage than renting the property for whatever time period.

You can't decide to just not live somewhere. There's a difference between real estate as an investment, and discussing whether you should rent or own your primary residence.

>Let me create a highly unique scenario that will not apply to even .001% of the population, that will surely win this internet argument for me
Do you even realize how silly your angle is, or is all you can see red because someone on the internet has a different opinion than you. The fact that you have to contort a wild scenario to be right means in every other scenario you're wrong.

Regardless though, credit cards are $0 down loans, I currently have a 18,500 monthly limit, which I could probably convert to $15,000 cash if I really hustled. There's my $0 down loan that I can put into options. Jesus fuck I have lost since I lowered myself to your level of stupidity though...

You're probably correct that you can find less expensive home outside the city. Home prices are inflated where I live (Dallas, TX).

I was just checking for what would be 45 minutes out from my job. For me to break even on rent I would need a max loan of 150k. 0 results in this range.

You're smart to take advantage of the prices in your area but it isn't the same everywhere.

Are you actually claiming you've never heard of 0 down house loans? They're even making a come back.

Doesn't change my point that the opportunity cost is of the down payment, not the lump sum loan principal, because you weren't given and couldn't get that loan for anything else.

this user is correct

>couldn't get that loan for anything else.
see

This, and especially if not viewing real estate appreciation as a 100% guarenteed item in your calculations, owning an equivalent property to what you would rent in 90% of cases works out better, especially when account for incentives like in the US the Mortgage Interest Deduction, or the 30 year fixed rate mortgage.

Other areas may differ.

Again, 20,000 there is the down payment not the loan principal...

If you had access to the loan principal for anything you wanted, you could gain rough 5 million in leverage through options.

>I'd rather pay rent instead of a mortgage which becomes equity
>I'd rather earn 6% than have incredible leverage on a consistently appreciating asset.
>Why am I poor?
>Why am I 65 and still not retired?

first rule for being poor is considering your home/primary residence as an asset instead of a liability

second rule for being poor is having over 50% of your net worth tied into a non liquid """"asset""""

No, you're smart.

Depends where you live and what the market is doing/what's the economic outlook of your area. Some places it's cheaper to rent, sometimes it cheaper to buy.

It's always better to buy your home flat-out with cash though.

Like if you could take out a 10 year loan, or just wait 10 years and buy it outright, just keep renting and wait.

If you can predict that housing prices will increase faster than your loan, then go for it, but who knows, you could buy at the top of a bubble, and fuck yourself.

You also have to factor in depreciation of your home (furniture, repairs, appliance/floor replacement, etc.) when you own it.

So not only do you have a mortgage, but you also have a liability you don't even own (flood, tornado, snowstorm, termites, arson, etc).

Holy fuck you are all morons. Let me explain it to you should always own a home. Here is a case study.
>Home price: $300,000
>Down payment: 3.5%
>Interest rate: 4%
With a 30 year loan you end up paying $743,000 for the home. All interest included.
>The house appreciates 4.8% a year (national average) Totaling $1,224,502
With a simple down payment of less than $11,000 you now have a 1.2 million dollar asset.
Mortgage rates are very similar to renting costs in most markets. To give this money to a landlord instead of investing in an asset is simply retarded.

It is never better to buy your home with cash. Are you fucking dense? I understand that the market has the potential to crash. But historically rates of appreciation have always, ALWAYS, been higher than mortgage rates. That's like refusing to play blackjack that has 80% odds in your favor because you have the potential to lose.

A 1 bedroom condo in my area is $400k. I don't think this price reflects the actual value. I'm waiting for the market to crash again but who knows how long that will take.

Meanwhile, rent is 2200 / month.

So recently I've put some though into buying a van and living in there for at least a couple years to save some more money. Has anyone here done that before? It's looking more and more appealing every month.

You are retarded. You are arguing that investing in options with a credit card is a better investment than a mortgage.

High cap rate rental properties will almost always have a 100% or more cash on cash return without any appreciation. To act like investing in real estate is the same as any other industry is simply ignorant.

There's also the fact that provided you pay your mortgage and taxes, no one can force you to leave. A renter could always just not get their lease renewed.

Silicon Valley? Portland? Vancouver?

Prepare for laws to make that harder and harder to do, and also to keep moving your place and being disliked by the communities you'll be stealth parking in.

owning property? living in the nyc area doesn't let me do that unless i a. wilingly live basically pay check to paycheck to buy property in a good area or b. live in a shit area and pray the hipster gods start moving in

Is moving out of the parents house a meme now? Serious question.

Both renting and buying cost money that I don't even need to spend because all I need is a bed, a kitchen, and a toilet.

I work exactly 40 hours a week and I live with my parents for two years out of college now. I cook/clean, do yardwork, help out with groceries, tech support, and provide the household with nice things like good electronics, and movies/books/shows for my parents. By not moving out my expenses are lowered to $300/month while my income is $5400/month.

Am I stupid for not wanting to move out at all? I'm not trying to time the market so I have everything invested beyond a hefty emergency fund.

I have tried to poke holes in my own plan but it just doesn't make sense to move out, period. Everyone tells me, "You need to move out of your parents house!"

>second rule for being poor is having over 50% of your net worth tied into a non liquid """"asset""""
this means most of America's millionaires are poor
remember that next time you say being a millionaire isn't a big deal anymore

There really is no reason to move out. Not only do you help your parents, but your future as well. All that money saved = more things.

>Am I stupid for not wanting to move out at all?

Yes, you're a grown manchild. You're a burden on your parents regardless of how much you try rationalizing it, and you're stunting your social maturation.

>I have tried to poke holes in my own plan but it just doesn't make sense to move out, period. Everyone tells me, "You need to move out of your parents house!"

You don't have the mindset to process the opposing viewpoint coherently. You're sitting watching shadows in the cave.

It's worth it if you have parents that don't want to hear their kid banging. I like owning my home. I live in the country though.

You need to get a girlfriend and then see how feasible it is to live at home.

Money is great but social maturity and the concept of independence is a facet of life that you cannot buy.

It is, but at the end of paying the mortgage you have a house. You can pay rent as long as you please but you have nothing to show for it at the end.

It's good you're questioning it though - sometimes it does make more sense to rent (temporarily at least) even when you can afford to buy. For example property prices are insanely inflated where I live but rent is still relatively cheap (read: less insanely inflated). I can afford a deposit but am holding off for the market to settle down (interest rates are due to rise and force a bunch of mortgagee sales soon, and correcting the housing market is going to be a major issue in our election later this year - it's possible prices may not drop much but they can't rise much more either, and if they don't drop I'll keep renting or move to a cheaper area).

Renting is fine as long as you're putting several hundred away every month. Take the difference between a mortgage and rent and save/invest that money.

>but there are literally tens of thousands of people who were forced to foreclose in 2008
wasn't that people who were delinquent with their mortgage payments?

don't buy a house

wait for the crash that will happen when boomers realize millennial can't afford their 90s era cookie cutter template home

what will moving back out do to help my social maturation
moving out in the first place and having to live with others is what made me want to avoid social interaction altogether

>You need to get a girlfriend
gross
no thanks

Sounds like you bought too big of a house and you don't know what to do with it. If you think you could easily get 250k on it, why not do some small projects on it and put it on the market and see if you can make >250k? Then you paid your loan and made a little profit if you can clear your initial investment.

this
except "don't want" rather than "can't afford"