I'll be generous and put the home price at 200K, to make the math easy and divide everything by five. If I divide all his numbers by five (I know, might not be wholly accurate, but it's too late at night for me to do all the math), I get an expenditure of $5,200 per year for renting versus $8,300 for buying. Still more, of course, but the $3,100 difference can be certainly understandable if the person wants to spend that much more to own.
Anyone who's taking out a $750k loan that doesn't have a huge salary needs to have their head checked. That's why I thought it was a poor example, even if his logic is fairly sound.
In the quote it says he's talking about a 200k home, for which the total costs by the time you've paid off the loan (plus all the maintenance that goes into it) costs close to $1m.
I'll be generous and put the home price at 200K, to make the math easy and divide everything by five. If I divide all his numbers by five (I know, might not be wholly accurate, but it's too late at night for me to do all the math), I get an expenditure of $5,200 per year for renting versus $8,300 for buying. Still more, of course, but the $3,100 difference can be certainly understandable if the person wants to spend that much more to own.
Anyone who's taking out a $750k loan that doesn't have a huge salary needs to have their head checked. That's why I thought it was a poor example, even if his logic is fairly sound.
In the quote it says he's talking about a 200k home, for which the total costs by the time you've paid off the loan (plus all the maintenance that goes into it) costs close to $1m.
What quote is that? I'm confused.
What I heard in his intro is that the options were renting for $3k/month(!!) or buying for $1m, with $250k in cash on hand. If that third part is true, then he could just buy a $200k house out right with his $250k.
I'll be generous and put the home price at 200K, to make the math easy and divide everything by five. If I divide all his numbers by five (I know, might not be wholly accurate, but it's too late at night for me to do all the math), I get an expenditure of $5,200 per year for renting versus $8,300 for buying. Still more, of course, but the $3,100 difference can be certainly understandable if the person wants to spend that much more to own.
Anyone who's taking out a $750k loan that doesn't have a huge salary needs to have their head checked. That's why I thought it was a poor example, even if his logic is fairly sound.
In the quote it says he's talking about a 200k home, for which the total costs by the time you've paid off the loan (plus all the maintenance that goes into it) costs close to $1m.
What quote is that? I'm confused.
What I heard in his intro is that the options were renting for $3k/month(!!) or buying for $1m, with $250k in cash on hand. If that third part is true, then he could just buy a $200k house out right with his $250k.
Post subject: Re: To rent or to own? That is the question.
Posted: Wed Sep 01, 2010 7:10 pm
Administrator
Joined: Sat Oct 16, 2004 10:53 pm Posts: 20537 Location: The City Of Trees
homersheineken wrote:
True, but not in that same area.
Right. What I'm saying is that his area he used (Silicon Valley) is far from the norm. I didn't even know it was that spendy there, I would have thought he was talking about SF proper or something.
Post subject: Re: To rent or to own? That is the question.
Posted: Wed Sep 01, 2010 8:36 pm
Unthought Known
Joined: Tue Sep 13, 2005 7:02 pm Posts: 6405 Location: DC Gender: Male
Here in DC, it makes more sense to rent.
Single family homes are out of the question as most in "good" neighborhoods are over 1 million. Row Houses in "up and coming" areas go for about 550k to 700k. Condos in these neighborhoods are gonna run bar minimum 200k (for like 800 sq. ft.). A decent condo w/ 2 bedrooms and 1.5 bathrooms will cost you at least 350k.
You could move to "gentrification" hoods, and cut those prices down a lot...like a single family going for about 480k or so, row houses for about 350k or so. But...if you go this route, you live in a questionable place, and you'll need to spend at least 25k to 100k to fix it up.
Post subject: Re: To rent or to own? That is the question.
Posted: Wed Sep 01, 2010 10:55 pm
Unthought Known
Joined: Tue May 09, 2006 2:42 pm Posts: 8393
I own a home, but I keep thinking that this is a great time to buy. It can't get any worse that this, can it? Then I think that all of the boomers are gonna die soon and flood the market. Mind you, I don't really know shit, I just have thoughts about things to do with money I don't have.
Post subject: Re: To rent or to own? That is the question.
Posted: Wed Sep 01, 2010 11:12 pm
Father Bitch
Joined: Fri Oct 22, 2004 12:20 am Posts: 5198 Location: Connecticut Gender: Male
Self Polluted wrote:
I own a home, but I keep thinking that this is a great time to buy. It can't get any worse that this, can it? Then I think that all of the boomers are gonna die soon and flood the market. Mind you, I don't really know shit, I just have thoughts about things to do with money I don't have.
I bought last October, because it couldn't possibly get worse.
Post subject: Re: To rent or to own? That is the question.
Posted: Wed Sep 01, 2010 11:20 pm
Unthought Known
Joined: Tue May 09, 2006 2:42 pm Posts: 8393
Sandler wrote:
Self Polluted wrote:
I own a home, but I keep thinking that this is a great time to buy. It can't get any worse that this, can it? Then I think that all of the boomers are gonna die soon and flood the market. Mind you, I don't really know shit, I just have thoughts about things to do with money I don't have.
I bought last October, because it couldn't possibly get worse.
Post subject: Re: To rent or to own? That is the question.
Posted: Thu Sep 02, 2010 1:06 am
statistically insignificant
Joined: Mon Jan 21, 2008 10:19 pm Posts: 25134
All real estate is local, but I'd be shocked if home prices don't drop at least another 20% (more on the coasts). This is exactly the worst time to buy, as the credit excesses of the last few decades have only just begun to unwind.
It's ugly now, and it's going to get much, much uglier.
Post subject: Re: To rent or to own? That is the question.
Posted: Thu Sep 02, 2010 1:53 am
Unthought Known
Joined: Tue Sep 13, 2005 7:02 pm Posts: 6405 Location: DC Gender: Male
thodoks wrote:
All real estate is local, but I'd be shocked if home prices don't drop at least another 20% (more on the coasts). This is exactly the worst time to buy, as the credit excesses of the last few decades have only just begun to unwind.
It's ugly now, and it's going to get much, much uglier.
In DC, with the Feds here, it's gotten worse but still ridiculous. What was once a 3 bedroom 1.5 bathroom house that went for 1.5 million, is now 900k. Sure it's cheaper, but still rigoddamndiculous.
Edit...I was drunk when I posted the above...I meant to say, with the Feds here, the market never really goes down. Where a state like Kansas may be taking a beating in the market right now, DC remains pretty untouched since the surrounding area is highly transient, and Fed workers / Consultants are always coming and going.
Last edited by darth_vedder on Thu Sep 02, 2010 11:52 am, edited 1 time in total.
Post subject: Re: To rent or to own? That is the question.
Posted: Thu Sep 02, 2010 3:26 am
Administrator
Joined: Sat Oct 16, 2004 10:53 pm Posts: 20537 Location: The City Of Trees
thodoks wrote:
All real estate is local, but I'd be shocked if home prices don't drop at least another 20% (more on the coasts). This is exactly the worst time to buy, as the credit excesses of the last few decades have only just begun to unwind.
It's ugly now, and it's going to get much, much uglier.
Post subject: Re: To rent or to own? That is the question.
Posted: Thu Sep 02, 2010 8:12 pm
Got Some
Joined: Fri Sep 02, 2005 8:52 pm Posts: 2647 Location: Where gila monsters meet you at the airport
Skitch Patterson wrote:
Self Polluted wrote:
cutuphalfdead wrote:
Self Polluted wrote:
cutuphalfdead wrote:
You know, a pool can really increase a home's value.
Quite the opposite, in fact.
A well maintained pool.
Honestly, it depends on location. Where we live, a pool can actually decrease the value.
thats true anywhere. the only pools that help value are in ground, good condition, well maintained. Above ground pools do not help, and often hinder.
In Phoenix, where pools are common, there is essentially no difference in home prices for pool or no pool. The pool might be a premium item for some buyers but there are enough buyers who don't want a pool under any circumstances that it ends up being kind of a wash. Considering that a nice, in-ground pool easily runs 10-20k, and it's not really the kind of thing you would put in as an investment.
All that said, I generally wish my house had a pool.
Post subject: Re: To rent or to own? That is the question.
Posted: Thu Sep 02, 2010 9:04 pm
Resident Frat Dick
Joined: Sat Mar 19, 2005 7:50 pm Posts: 10229 Location: WA (aka Waaaaaaaahhhh!!) Gender: Male
As a Realtor I say own, of course. But you have to purchase wisely and do so for the right reasons. It's not for everybody...especially (in the current market) if you plan to sell/move again any time soon. But if it's a long-term investment and you are responsible about it, then do it.
Without reading this whole thread I would like to remind people that (at least in WA) the interest you pay on your mortgage can be used as a tax writeoff. That's huge.
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