Posted by: dctroll February 29, 2016
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@Santa lil helper. In response to your reply to me:
Line 1: *there not their
Line 5: *paid not payed
First, I would be weary of any advice from a person who makes mistakes like these.
Now, I didn't say whether someone should or should not buy a house. I was just making a point that the mortgage is not a replacement to apartment rent. That's all. If someone can afford the added expense, good for them.
Regarding maintenance, you don't maintain your apartment. If anything goes wrong, the apartment owner takes care of it. In addition to that, renter's insurance is much cheaper than homeowner's insurance.
This argument that mortgage stays the same while rent increases is false. Rent does increase. But so does the property tax on the house.
I also don't understand this mindset of building equity. What does that even mean? The statement is based on so many variables that I laugh when I hear this. The most important one: Economy. What are you going to do when another recession hits; you have build up this "equity" that you love so much, and now you lost your job. Home foreclosed. Or you don't lose your job but the value of your house is now half of what you took out a mortgage for. What are you going to do?
Lastly, I think it is you who doesn't understand the concept of "owing or being owned" as you like to call it. If I live in an apartment I "owe" the apartment until the lease expires. If I am in a mortgage, I "owe" the bank mortgage for another 15 or 30 years regardless. If something were to happen you owe the bank no matter what. But with apartment, you are free as soon as your lease is up. I would argue that you are "owned" by the bank.
Buying a home is a decision for each individual. It makes sense for some. To really get into the specifics if buying a home is right for you, you should do some research on your own. One specific issue I consider is whether putting that extra expense of mortgage and the initial down payment into a 401(k) instead of buying a home. That way the money appraises 5-7% every year. And you have a nice cushion when you retire. When you are 70 and on a fixed retirement income, the increased property tax, maintenance etc. are going to take a toll financially. You will be paying the same amount in these expenses as someone would pay to live in an apartment, except you are paying to stay in your own home. Yes, you will be a "owner" of a house. A house you can pass on to your kids, while you live miserably trying to catch up on medical bills.
Santa lil helper, you have expressed your view and so have others including me. There is no need to get all riled up about it. Relax "bro".
Line 1: *there not their
Line 5: *paid not payed
First, I would be weary of any advice from a person who makes mistakes like these.
Now, I didn't say whether someone should or should not buy a house. I was just making a point that the mortgage is not a replacement to apartment rent. That's all. If someone can afford the added expense, good for them.
Regarding maintenance, you don't maintain your apartment. If anything goes wrong, the apartment owner takes care of it. In addition to that, renter's insurance is much cheaper than homeowner's insurance.
This argument that mortgage stays the same while rent increases is false. Rent does increase. But so does the property tax on the house.
I also don't understand this mindset of building equity. What does that even mean? The statement is based on so many variables that I laugh when I hear this. The most important one: Economy. What are you going to do when another recession hits; you have build up this "equity" that you love so much, and now you lost your job. Home foreclosed. Or you don't lose your job but the value of your house is now half of what you took out a mortgage for. What are you going to do?
Lastly, I think it is you who doesn't understand the concept of "owing or being owned" as you like to call it. If I live in an apartment I "owe" the apartment until the lease expires. If I am in a mortgage, I "owe" the bank mortgage for another 15 or 30 years regardless. If something were to happen you owe the bank no matter what. But with apartment, you are free as soon as your lease is up. I would argue that you are "owned" by the bank.
Buying a home is a decision for each individual. It makes sense for some. To really get into the specifics if buying a home is right for you, you should do some research on your own. One specific issue I consider is whether putting that extra expense of mortgage and the initial down payment into a 401(k) instead of buying a home. That way the money appraises 5-7% every year. And you have a nice cushion when you retire. When you are 70 and on a fixed retirement income, the increased property tax, maintenance etc. are going to take a toll financially. You will be paying the same amount in these expenses as someone would pay to live in an apartment, except you are paying to stay in your own home. Yes, you will be a "owner" of a house. A house you can pass on to your kids, while you live miserably trying to catch up on medical bills.
Santa lil helper, you have expressed your view and so have others including me. There is no need to get all riled up about it. Relax "bro".