Done 25% and 40% on two homes within 4 years... Buying has been a no brainer, even in this environment I'm still well ahead
Done 25% and 40% on two homes within 4 years... Buying has been a no brainer, even in this environment I'm still well ahead
You made 25/40% on the value of the homes in 4 years, on as a return on your equity?Originally posted by ercchry
Done 25% and 40% on two homes within 4 years... Buying has been a no brainer, even in this environment I'm still well ahead
Home value... ROI is just stupid... Realized gains were only on the 25% house as I still live in the other one... But yeah did very well, only a 2 year hold on that one too
Originally posted by ercchry
Home value... ROI is just stupid... Realized gains were only on the 25% house as I still live in the other one... But yeah did very well, only a 2 year hold on that one too
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Last edited by Sugarphreak; 08-15-2019 at 02:17 PM.
That's too simplistic a view, however. Your existing equity represents an opportunity cost, also. There's other reasons you can't just translate over your costs.Originally posted by Sugarphreak
In the event I ever sell my current place, I was looking at my options for renting short term while I figure out where I want to be... I've concluded that it is pretty expensive if you don't want to in a dump.
I figure my unrecoverable costs related to ownership (mortgage interest & prop tax) is somewhere around $1850 a month. The only thing I can rent for that is a dumpy house or small condo.
Ownership seems like the only way to go if I want to live both frugal and well
I have been a longtime homeowner, and I've done well, but I agree that it's simplistic to say that renting is a poor choice. Home ownership is not the utopia that many folks like to pretend it is. Let's face it, there are entire industries who need to convince folks that it's a sound financial investment, plus all the millions of folks who have done it who want to justify their choices.
There is NOBODY who is unbiased in this discussions.
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Last edited by Sugarphreak; 08-15-2019 at 02:17 PM.
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Last edited by kaput; 03-12-2019 at 12:12 AM.
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Last edited by Sugarphreak; 08-15-2019 at 02:16 PM.
I agree with owning a home - but the reason for this strong correlation is likely the massive (and unsustainable) appreciation in house prices over the past 15 years.Originally posted by Sugarphreak
Still, I have yet to meet a rich person that rents... And anybody I know growing up that still rents isn't doing it for the savings. There seems to be an undeniable correlation between wealth and home ownership.
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Last edited by kaput; 03-12-2019 at 12:20 AM.
I like your style.Originally posted by kaput
That's still too simplistic. If you want to selectively ignore certain costs then why not remove property tax from the equation and get an even more favorable result? Pretend you didn't pay monthly and that it will be deducted as a lump sum lien from the proceeds of the sale (similar to realtor commissions). Now we are comparing against rentals with an unrecoverable budget of just $1300/mo. Owning wins!
Selling costs may not be as obvious as a monthly cash flow, but you still pay them. Realistically, the 'unrecoverable' sunk cost of owning to date in this example is at least $2600-2850/mo. That's the starting point.
In order to weigh this cost against potential gains, we would have to estimate an opportunity cost of the down payment over the same period of time, as Buster mentioned. Consider also that your gains are currently zero and you're stuck holding an illiquid asset in a declining market.
I also agree with owning a home, but if it's going to be treated as a financial asset instead of an emotional one, then all the costs, benefits, and risks should be factored in to the rent vs buy equation. Most people overlook that last one.
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Last edited by kaput; 03-12-2019 at 12:09 AM.
Hell you could rent and only own that Unicorn costume and your net worth would be positive. LOLOriginally posted by kaput
Pay no attention to me. I'm a renter by choice with a positive net worth, just a figment of your imagination.
Good explanation though. I hated renting because I hate people, so owning my own house allows me to do to it, and in it, whatever I want or don't want.
Originally posted by adam c
Line goes up, line goes down, line does squiggly things and fucks Alberta"The stone age didn't end because we ran out of stones"
So you got your ass kicked by every schmuck investor who did almost zero work and just bought the US index? Looks to me like you would've done 60% if you'd put your money there instead 4 years ago.Originally posted by ercchry
Done 25% and 40% on two homes within 4 years... Buying has been a no brainer, even in this environment I'm still well ahead
http://web.tmxmoney.com/quote.php?qm_symbol=vti:us
He said a few posts later that those returns were based on home value? ROI is likely in the 300-400% range??
Hmm, did not see that. Damn unicorn distraction.
Originally posted by dirtsniffer
He said a few posts later that those returns were based on home value? ROI is likely in the 300-400% range??
That's why I asked... There's no denying that ercchy did VERY well with those properties. It also highlights another oft forgotten factor of ownership and returns... The ROI on home appreciation isn't the amount or % the value of the entire home appreciated, but how that amount relates to the equity of the owner... It's strange how many seemingly intelligent people forget, or just don't grasp that concept.Originally posted by Feruk
Hmm, did not see that. Damn unicorn distraction.
I don't expect a conclusion to this discussion, but I think any reasonable person that can take emotion out of the own v. buy debate will agree that... It depends.
Timing and other opportunities are the biggest factors in this whole thing and frankly, more often than not, it comes down to dumb luck*
*waits for the inevitable claims from posters saying they timed the market / are smarter than that / blah blah blah
Long analysis with supporting marth
http://affordanything.com/2015/11/24...i-rent-or-buy/I’ve heard a lot of ridiculous statements:
“I’m sure we’ll find parking.”
“I’ll just check Facebook for five minutes.”
“I’ll skip dessert.”
But perhaps the most absurd is the adage: “If you’re a renter, you’re throwing money away.”
Bulls**t.
You’ve heard those statements, right?
“I’m sick of throwing money away on rent.”
“Buying is always better than renting.”
“Your home is your biggest investment.”
I’m going to explain why these clichés are ludicrous. Preposterous. Outlandish. Nonsensical.
(Somebody please take the thesaurus away from me.)
Let’s chat about the “should I rent or buy?” question using logic, math and reason, rather than ill-informed clichés.
Before we jump in, let’s establish a few premises:
*This article is about your primary residence (the place where you sleep).
*This is not an article about real estate investing.
*As with all articles on Afford Anything, these high-level concepts can be applied anywhere. But specifics about laws, taxes, inflation, etc., are geared at a United States audience.
With that said, let’s begin.
heloc that shit