Renting vs. Home ownership

[snafu]

In Asia, accommodation is often an employment benefit in the same way that Worker's Compensation Ins. is a N American benefit that is ignored unless it is needed.
What other investment provides a roof over your head with terms and conditions you controlled at start. I'd rather live in a region with slow, steady appreciation than the rollercoaster Hot mkt. scenerio. If I were you and serious, I'd contact a good, experienced realtor/agent in the district you wish to buy. Explain your concerns and ask for a print out of houses that sold 10 or 15 yrs. ago, and what they would be listed today...or anything sold in that parameter since the economy crashed last Sept.

This may be the perfect opportunity to buy while interest rates are lower than most of us expected and your gov't offers you $8K donation from other taxpayers!

[TBH]

I have felt that some of our friends wonder why we haven't bought yet (i.e. questioning our financial capabilities), but the funny thing is that the ones that probably wonder are the ones that are also hyperconsumers.

This is so true.

I feel this quite strongly even though I do own a house. We chose to buy in a transitional neighborhood because we can get a much nicer house. Most of our friends live "on the other side of the tracks." I often feel very aware that we LOOK poorer--we drive a 15-year-old car, we're sending our kid to public school in an area where most people who can afford it go to private school, and we do not have a very desirable address.

But I love my house, and I would rather live here than in a crappy house in a better neighborhood. I love my no-payments, no-comprehensive-insurance car. And I love that public school is free, which means we can both work less and spend more time with our kid.

I think most of our friends probably make more money than we do, but I also think we do very well the amount of money we do have.

[snafu]

TBH while you may not need to pay tutition for your child, I doubt that public school can be considered 'free.' Your taxes whether to the school board or municipality pays a major portion of the cost of the building and staff. Your child is being subsidized by business tax, owners and renters who do not have children in public school. Kudos to you for choosing family over spending

[Taxplanr]

"Why would anyone go through the hassle and expense of buying only to turn around and sell a short time later. "

Exemption from capital gains tax if you owner occupied the home for 2 of the last 5 years. There really is no better tax break under the Code.

[disneysteve]

"Why would anyone go through the hassle and expense of buying only to turn around and sell a short time later. "

Exemption from capital gains tax if you owner occupied the home for 2 of the last 5 years. There really is no better tax break under the Code.

I'm sure the millions of Americans who have sold their homes at a loss in the past few years aren't comforted by that fact.

[TBH]

TBH while you may not need to pay tutition for your child, I doubt that public school can be considered 'free.'

As I typed that, I knew somebody would point out that everybody who pays taxes is paying for public schools.

But you knew what I meant! For most of the time since our son was born, our childcare expenses have been much higher than our mortgage payments. It sure feels good to be done with that. We are thinking of having another kid and that is a major consideration.

[Seeker]

Home ownership, most definitely, is not the "right" choice for everyone. And definitely also not for a limited duration of less than 7 years in that particular location.

The costs of home ownership only make sense if people plan to reside in that location for >7 years, and usually tied along with that are the two factors:

1) permanance in career and the location supports that job growth in that area of career (whatever the career is)

2) Renting prices are equivalant or higher than the mortgage would be (ie. the location has excess population.

Regardless of taxes (and so-called "benefits") and feelings of competition (with neighbors or peers), if a person expects to not stay in the location, then he/she should definitely NOT be a home-owner.

[LivingAlmostLarge]

I think we're selling next year after 5 years. We had estimated between 5-7 years of staying put. My DH acknowledges we still might stay put one more year solely because of personal reasons (upcoming baby).

But we're not staying put longer than 7 years. I want to leave the area, but my spouse was not willing to rent/move every year for potentially 7 years.

I like owning. It's cost us I think about the same. Renting where we live is expensive.

A 3 bd townhouse what we have is $2200/month mortgage + $400/month Property taxes + $200/month HOA. But with the tax breaks it works out to something like $1800/month.

My roommate rents 1 bd in a 3 bd basement apartment, for $700/month. So around $2100/month to rent a crappier place than we have. And if he'd gotten a 2nd or 3rd story apartment it'd be an extra $1k easy. His bedroom has pipes running through it.

But he only plans on staying in the area for 2-3 years so why should he buy?

Renting is expensive where I live, HCOLA. But buying is expensive too if you move every couple years.

[amandasfinances]

It's a good time to buy now

Given how much prices have come down i think it makes sense to buy, the math works out in your favor now with lower interest rates and prices vs. rents is a better deal overall.