Comments on: The Nonsense of “Rent Vs. Buy Myths That Ruined the Housing Market” http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/ Simple, applicable personal finance advice for the modern world Fri, 10 Feb 2012 08:34:37 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Baley http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-943881 Baley Wed, 06 Apr 2011 13:44:24 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-943881 I must be lucky because my rent in a beautiful home covers maintenance (even if it is a little bit slow) plus all of these other expenses (as many people have said) of taxes, etc. But I only pay $450 a month. I could never in a million years pay for as nice a home (2 br in a decent neighborhood) for anywhere near that amount. And yes, I'm paying for maintenance, but at least it's included in the rental price, not in addition to the mortgage payment. Our landlord can make money because the one house is split into 4 apartments which is something I couldn't afford to buy. And, we still have 1100 sq. feet. And yes, it is our home, we can plant plants, paint the walls, do almost anything we want with the place. Our neighbors aren't bad, either. Regardless of the long-term financial benefits, I'm living in a place I love at a price I can afford. If I bought a house now, it would be very old, in need of lots of repairs, and still cost me at least $200 more a month (but that's likely a low estimate) before paying for the remodeling that would be required! I don't appreciate the comments that people make about renting being just "shelter" and not a "home." My apartment is a much nicer home than a comparable house I could buy. And, I'm in a small city in Tennessee. I must be lucky because my rent in a beautiful home covers maintenance (even if it is a little bit slow) plus all of these other expenses (as many people have said) of taxes, etc. But I only pay $450 a month. I could never in a million years pay for as nice a home (2 br in a decent neighborhood) for anywhere near that amount. And yes, I’m paying for maintenance, but at least it’s included in the rental price, not in addition to the mortgage payment. Our landlord can make money because the one house is split into 4 apartments which is something I couldn’t afford to buy. And, we still have 1100 sq. feet. And yes, it is our home, we can plant plants, paint the walls, do almost anything we want with the place. Our neighbors aren’t bad, either. Regardless of the long-term financial benefits, I’m living in a place I love at a price I can afford. If I bought a house now, it would be very old, in need of lots of repairs, and still cost me at least $200 more a month (but that’s likely a low estimate) before paying for the remodeling that would be required! I don’t appreciate the comments that people make about renting being just “shelter” and not a “home.” My apartment is a much nicer home than a comparable house I could buy. And, I’m in a small city in Tennessee.

]]> By: blah http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-921819 blah Fri, 20 Aug 2010 19:49:28 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-921819 I sometimes think those who attack renters so ardently, do so because they feel defensive of their greed to buy a house on time that they cannot afford. If you buy a house, or anything by going into debt, you are living beyond your means and not being content with what God has provided you. There is no such thing as a house you can afford, unless you buy it outright, because the very act of going into debt is evidence that you don't have the money to just buy it. I find for Christians especially, they have to make excuses if they want to take out loans because it is clear from the bible that debt is also spiritual bondage. I will maybe one day buy a house, maybe not, but if I do, it will be in cash. America has gotten so backwards that we no longer consider it shameful to go into debt and so have forgotten that for some, choosing not to go into debt is a moral decision, not just a financial one. That being said, I do invest the money I don't spend on interest and so have a chance to come out ahead of Trent, who just had to buy a house now, until waiting until he could afford one. Keep in mind, that I don't consider making morgage payments on time, being able to afford one, because you had to borrow money you didn't have. I also don't buy my stocks on margin :P and so consequently, don't need a bail out like so many banks and so many people whose morgages are under water. Guess what? You chose to take the risk of borrowing money and buying an asset. It isn't your lender's fault that you chose to buy something with the money you borrowed which then went down in price. I am sick of my tax dollars paying for the middle class greed and irresponsibility of others! So, there! I don't ask for government run programs to bail out my stocks if I make a bad investment and so I am sick of paying off your loans for you. Buy your own house, I and the rest of the tax payers are not your mommy, and I take exception to the fact that you think renters are not financially sensible, because, you and the rest of America feels that way, thus causing the housing bubble and this bad economy. It is not the banks' faults for wanting to make money as much as it is America's fault for thinking it is fine to go into debt for the greed of the American Dream, AKA, home ownership. I know you pay your morgage based on what you say in your blog, but you are a risk to me as a tax payer, because there is no sure bet that you will always be able to do so since you never know beyond a shadow of a doubt what a day will bring in this life. I sometimes think those who attack renters so ardently, do so because they feel defensive of their greed to buy a house on time that they cannot afford. If you buy a house, or anything by going into debt, you are living beyond your means and not being content with what God has provided you. There is no such thing as a house you can afford, unless you buy it outright, because the very act of going into debt is evidence that you don’t have the money to just buy it. I find for Christians especially, they have to make excuses if they want to take out loans because it is clear from the bible that debt is also spiritual bondage. I will maybe one day buy a house, maybe not, but if I do, it will be in cash. America has gotten so backwards that we no longer consider it shameful to go into debt and so have forgotten that for some, choosing not to go into debt is a moral decision, not just a financial one. That being said, I do invest the money I don’t spend on interest and so have a chance to come out ahead of
Trent, who just had to buy a house now, until waiting until he could afford one. Keep in mind, that I don’t consider making morgage payments on time, being able to afford one, because you had to borrow money you didn’t have. I also don’t buy my stocks on margin :P and so consequently, don’t need a bail out like so many banks and so many people whose morgages are under water. Guess what? You chose to take the risk of borrowing money and buying an asset. It isn’t your lender’s fault that you chose to buy something with the money you borrowed which then went down in price. I am sick of my tax dollars paying for the middle class greed and irresponsibility of others! So, there! I don’t ask for government run programs to bail out my stocks if I make a bad investment and so I am sick of paying off your loans for you. Buy your own house, I and the rest of the tax payers are not your mommy, and I take exception to the fact that you think renters are not financially sensible, because, you and the rest of
America feels that way, thus causing the housing bubble and this bad economy. It is not the banks’ faults for wanting to make money as much as it is America’s fault for thinking it is fine to go into debt for the greed of the American Dream, AKA, home ownership.
I know you pay your morgage based on what you say in your blog, but you are a risk to me as a tax payer, because there is no sure bet that you will always be able to do so since you never know beyond a shadow of a doubt what a day will bring in this life.

]]> By: Roo http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-915748 Roo Thu, 24 Jun 2010 23:34:25 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-915748 Here's a thought.. The person that OWNS the property that you're renting is getting your money and either paying off debt, or livin' the good life.. :P Here’s a thought.. The person that OWNS the property that you’re renting is getting your money and either paying off debt, or livin’ the good life.. :P

]]> By: Merry http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-910319 Merry Sat, 08 May 2010 23:53:18 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-910319 Dear Lord, please send Jay a lifetime's supply of Prozac, and have mercy on his soul while you're at it. Thank you. Trent, you're a saint. If I had written a post with these many people getting emotional at me, I'd probably have started leaving comments with multiple exclamation points. All you did was calmly state, three times, the point you were trying to make. One thing this post and all the contradictory (and cranky) comments shows is that choosing a residence is a highly emotional issue and cannot be resolved by talking about dollars alone. Good for you for trying to make calm, rational sense of the subject. Dear Lord, please send Jay a lifetime’s supply of Prozac, and have mercy on his soul while you’re at it. Thank you.

Trent, you’re a saint. If I had written a post with these many people getting emotional at me, I’d probably have started leaving comments with multiple exclamation points. All you did was calmly state, three times, the point you were trying to make.

One thing this post and all the contradictory (and cranky) comments shows is that choosing a residence is a highly emotional issue and cannot be resolved by talking about dollars alone. Good for you for trying to make calm, rational sense of the subject.

]]> By: Sara http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-908688 Sara Sun, 25 Apr 2010 17:12:31 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-908688 I am wondering how the scenario plays out with very high property taxes. A small house in my area has taxes around $6000 (or more!). And a comparable rent is around the same price as the mortgage payment without the taxes. And certainly the taxes will be going up, forever.. Also, as soon as my kids are grown, I will want to downsize to a more managable size house/apt. Does it pay to buy a house I only need for another 11 years or so when I would be just as happy in a studio or one bedroom apt? And because I rent, someone mows my lawn and even clears the snow. I have always though I wanted to buy a house, but I must say I am enjoying the freedom of not owning as well. And when the kids are grown I will be considering moving to a community where my needs are better met as well. Of course, all this is as long as I stay single. I see alot of people putting lots of time and money into their house asset and maybe it does pay off in the end. But the freedom of renting has some advantages as well. I am wondering how the scenario plays out with very high property taxes. A small house in my area has taxes around $6000 (or more!). And a comparable rent is around the same price as the mortgage payment without the taxes. And certainly the taxes will be going up, forever.. Also, as soon as my kids are grown, I will want to downsize to a more managable size house/apt. Does it pay to buy a house I only need for another 11 years or so when I would be just as happy in a studio or one bedroom apt? And because I rent, someone mows my lawn and even clears the snow. I have always though I wanted to buy a house, but I must say I am enjoying the freedom of not owning as well. And when the kids are grown I will be considering moving to a community where my needs are better met as well. Of course, all this is as long as I stay single. I see alot of people putting lots of time and money into their house asset and maybe it does pay off in the end. But the freedom of renting has some advantages as well.

]]> By: Lulu http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-757620 Lulu Wed, 19 Aug 2009 17:52:59 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-757620 I just wanted to add that I don't buy the arguement that renters don't have to pay for repairs, landscaping etc. First, it depends. There are plenty of rented houses in which the renter is expected to keep up the yard, in which washer/dryer and possibly other appliances aren't supplied so the renter is responsible for aquiring and repairing them. Also, even if it's included, your landlord isn't just some benevolent soul and he wasn't set back $1000 at all. Who do you think supplies his paycheck and keeps the maintenance and repair account full and overflowing? YOUR RENT. Yes we pay interest to the bank and the bank makes money off of that, but landlords and rental companies take a chunk out of your rent for their profit as well, and for maintening the properties. If anything at least when buying, your payments are itemized, even if you choose to make one lump payment/month--usually containing the following items: Mortgage(principle, interest), Insurance, taxes---even with all of these my mortgage is $300 LESS than the average rent of smaller properties in the same area. With that said, there are definitely places that it is better to rent, usually the coastal areas. I just wanted to add that I don’t buy the arguement that renters don’t have to pay for repairs, landscaping etc. First, it depends. There are plenty of rented houses in which the renter is expected to keep up the yard, in which washer/dryer and possibly other appliances aren’t supplied so the renter is responsible for aquiring and repairing them.
Also, even if it’s included, your landlord isn’t just some benevolent soul and he wasn’t set back $1000 at all. Who do you think supplies his paycheck and keeps the maintenance and repair account full and overflowing? YOUR RENT.
Yes we pay interest to the bank and the bank makes money off of that, but landlords and rental companies take a chunk out of your rent for their profit as well, and for maintening the properties. If anything at least when buying, your payments are itemized, even if you choose to make one lump payment/month–usually containing the following items: Mortgage(principle, interest), Insurance, taxes—even with all of these my mortgage is $300 LESS than the average rent of smaller properties in the same area. With that said, there are definitely places that it is better to rent, usually the coastal areas.

]]> By: matt http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-744819 matt Tue, 04 Aug 2009 06:24:18 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-744819 Trent you miss the point...renters never pay maintenance expense on rental units. the Landlord has to fix everything and replace appliances that break ie stoves refrigerators, heating systems ect. maybe some are duped into lease agreements that make them pay maintenance, but this is not the case in the majority of the circumstances. remember if the landlord refused to fix the problems, you can always move and rent somewhere else. ;) Also the rent vs buy argument is an interesting one and the one force the drives weather its better to buy then rent is appreciation or depreciation of the housing price. everyone seems to assume that houses go up, and can never go down, that in its self is a flawed argument. housing prices just like all other supply/demand based commodities can go up and down, only threw govt intervention have housing prices rose artificially for the last ten years, now the bubble has burst and prices will get cut in half or more. right now renting in the majority of the country is better than buying. in the near future buying will be better, when housing drops much more. that will happen when qualified buyers (ones with 20% down) and income to justify loans they can afford. when houses drop to reasonable "FREE market" prices buying houses will be LESS then the cost of renting the same structure. the 20% down is key to understanding why renting SHOULD cost more than owning. right now RENTING is the way to go in the majority of the country, but in the comming years i'd say about 3-5 buying will once again be king and much cheaper than renting by 30-40% i can't get into why on this forum, but do some research on housing buying/vs renting in 1970. you could buy a house for about 20k (usd) adj. for inflation that's 115k in today's dollars that is a payment under 500 a month, but then you needed a down payment of 20% rent in 1970 for a similar residence was about 800+ go figure. :) Trent you miss the point…renters never pay maintenance expense on rental units. the Landlord has to fix everything and replace appliances that break ie stoves refrigerators, heating systems ect. maybe some are duped into lease agreements that make them pay maintenance, but this is not the case in the majority of the circumstances. remember if the landlord refused to fix the problems, you can always move and rent somewhere else. ;)

Also the rent vs buy argument is an interesting one and the one force the drives weather its better to buy then rent is appreciation or depreciation of the housing price. everyone seems to assume that houses go up, and can never go down, that in its self is a flawed argument. housing prices just like all other supply/demand based commodities can go up and down, only threw govt intervention have housing prices rose artificially for the last ten years, now the bubble has burst and prices will get cut in half or more. right now renting in the majority of the country is better than buying. in the near future buying will be better, when housing drops much more. that will happen when qualified buyers (ones with 20% down) and income to justify loans they can afford. when houses drop to reasonable “FREE market” prices buying houses will be LESS then the cost of renting the same structure. the 20% down is key to understanding why renting SHOULD cost more than owning. right now RENTING is the way to go in the majority of the country, but in the comming years i’d say about 3-5 buying will once again be king and much cheaper than renting by 30-40% i can’t get into why on this forum, but do some research on housing buying/vs renting in 1970. you could buy a house for about 20k (usd) adj. for inflation that’s 115k in today’s dollars that is a payment under 500 a month, but then you needed a down payment of 20% rent in 1970 for a similar residence was about 800+ go figure. :)

]]> By: Kimberly http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-744773 Kimberly Tue, 04 Aug 2009 03:33:47 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-744773 When you rent you get precisely one thing: SHELTER. That’s it. When you buy you immediately get the enjoyment of the home - you get to put in a decking, a vegie patch, an air conditioner. You get to plant plants or let them die. You get to have a pet. "You get to damage the carpet and the walls and it’s NOBODY’S BUSINESS BUT YOUR OWN. You can smoke and have parties inside. You can just go straight ahead and get stuff fixed up around the house without waiting for the bored real estate agent to get around to it. … you get a HOME. … and in the meantime the renter is stuck trying to make a life around their mere SHELTER." Again, another falsehood homeowners tell themselves about renting. My rental apartment is far more than shelter. I can paint it and make it my own. It is beautiful and updated and is everything I want in a home. The landscaping is pristine. We have swimming pools and wonderful neighbors who are far more friendly than in our snotty old neighborhood. My husband and I like it far more than the home we owned, which was actually bigger and was in quite a nice neighborhood. We do plan on buying again in a couple of years (so we can have a place for my parents to live with us, a good , etc...)and I will be sad to move from our beloved home that we RENT. When you rent you get precisely one thing: SHELTER. That’s it.

When you buy you immediately get the enjoyment of the home – you get to put in a decking, a vegie patch, an air conditioner. You get to plant plants or let them die. You get to have a pet. “You get to damage the carpet and the walls and it’s NOBODY’S BUSINESS BUT YOUR OWN. You can smoke and have parties inside. You can just go straight ahead and get stuff fixed up around the house without waiting for the bored real estate agent to get around to it.

… you get a HOME.

… and in the meantime the renter is stuck trying to make a life around their mere SHELTER.”

Again, another falsehood homeowners tell themselves about renting.

My rental apartment is far more than shelter. I can paint it and make it my own. It is beautiful and updated and is everything I want in a home. The landscaping is pristine. We have swimming pools and wonderful neighbors who are far more friendly than in our snotty old neighborhood. My husband and I like it far more than the home we owned, which was actually bigger and was in quite a nice neighborhood. We do plan on buying again in a couple of years (so we can have a place for my parents to live with us, a good , etc…)and I will be sad to move from our beloved home that we RENT.

]]> By: Kimberly http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-744770 Kimberly Tue, 04 Aug 2009 03:25:49 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-744770 I have owned and rented. I plan to buy again, but most people I know who buy really do delude themselves about cost. As long as people are realistic and realize that they will pay close to twice the sticker price on a 30 year mortgage (which most people take 30 years to pay.) You also have to factor in new roofing, A/C's, fences, toilets, plumbing, lawnmowers appliances, new flooring when the old is gross or unstylish, any redecorating or remodeling etc... Even on a modest home, in 30 years with only repairs and maintenance, you could easily spend $30,000- $50,000 dollars. The article was one sided, but there is so much rental and apartment bashing in the U.S. that maybe a little exaggeration is needed to teach people it's not trashy or evil. I have owned and rented. I plan to buy again, but most people I know who buy really do delude themselves about cost. As long as people are realistic and realize that they will pay close to twice the sticker price on a 30 year mortgage (which most people take 30 years to pay.) You also have to factor in new roofing, A/C’s, fences, toilets, plumbing, lawnmowers appliances, new flooring when the old is gross or unstylish, any redecorating or remodeling etc… Even on a modest home, in 30 years with only repairs and maintenance, you could easily spend $30,000- $50,000 dollars.

The article was one sided, but there is so much rental and apartment bashing in the U.S. that maybe a little exaggeration is needed to teach people it’s not trashy or evil.

]]> By: Soeren http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-737628 Soeren Sun, 26 Jul 2009 03:33:37 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-737628 I just wanted to add that, with plummeting home prices and thousands of forelosed properties sitting on banks' balance sheets, it is now possible to buy an entry-level fixer-upper in a decent area for less than the price of a new car -often wih corresponding drops in property taxes, to boot. Rents, however, have not followed suite at nearly the same pace. Given these new dynamics, why would anyone pay $400-500 a month to rent a home they could buy for $15-20k or so, and be able to pay off within 3-5 years at about the same or even lower monthly cost than renting? I just wanted to add that, with plummeting home prices and thousands of forelosed properties sitting on banks’ balance sheets, it is now possible to buy an entry-level fixer-upper in a decent area for less than the price of a new car -often wih corresponding drops in property taxes, to boot. Rents, however, have not followed suite
at nearly the same pace. Given these new dynamics, why would anyone pay $400-500 a month to rent a home they could buy for $15-20k or so, and be able to pay off within 3-5 years at about the same or even lower monthly cost than renting?

]]> By: Mike Palmeter http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-721702 Mike Palmeter Thu, 09 Jul 2009 03:41:35 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-721702 There is nothing you've really said in this commentary that wouldn't have been better said in a spreadsheet format. If I build a mathematical model based on your commentary it clearly indicates that I'm an idiot for having bought my home, which is odd, considering that it is the inverse of your conclusion. Perhaps I built my spreadsheet wrong - please post your own so I can compare. There is nothing you’ve really said in this commentary that wouldn’t have been better said in a spreadsheet format. If I build a mathematical model based on your commentary it clearly indicates that I’m an idiot for having bought my home, which is odd, considering that it is the inverse of your conclusion. Perhaps I built my spreadsheet wrong – please post your own so I can compare.

]]> By: Ashley http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-697259 Ashley Sun, 14 Jun 2009 21:27:49 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-697259 Rent vs. own? There are pros and cons to each scenario. It depends on your lifestyle, circumstances, location, job security, economic status, and a host of other issues. It isn't a black-and-white issue. Rent vs. own? There are pros and cons to each scenario. It depends on your lifestyle, circumstances, location, job security, economic status, and a host of other issues. It isn’t a black-and-white issue.

]]> By: Edwardo http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-695871 Edwardo Sat, 13 Jun 2009 09:52:42 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-695871 As a person who has rented for many years, I find the arguments that renting is better amusing. Several people have said that when they had something break, it was the landlords problem and the landlord fixed it. I have rented from both companies and from individuals, and I would love to know where you people are renting who don't have greedy landlords who will turn the blame on everything to you. I have time and time again had landlords force me to fix or pay to fix stuff that was supposed to be covered by them in the lease. Why? Because they know they have the bully pulpit in the situation. Landlords have the money, the time, and more legal widgets on their side than renters... so they can get away with screwing over renters. Heck I am in a debate with my current landlord over fixing a blade on a vertical blind. They even acknowledged it was normal wear and tear as stated in the lease... but they have refused to fix it until I move out, and they want to take it out of my security deposit. With other landlords, I have gone weeks or months without repairs on wiring and appliances. I have even had the heat go out and had to actually threaten getting the state involved since that is a legal thing the apartment was required to have to get the landlord to fix it... but boy did they take their sweet time. Again, you people who get things replaced the next day are very very very lucky. You might consider taking some of that good fortune and cashing in at the local casino... If I am going to have to pay for repairs, I would rather do so on my own property. Which, if things go well with the paperwork, I will start doing on the 19th of this month. Yes... the market finally got low enough and I am buying a home. I look forward to home ownership and my (hopefully) last dealing with landlords when my lease ends at the end of the month. When I own my new house, it is mine to do what I want with. I have dreams of changing ceiling fans and doing painting. And I can do all that. I will not have a landlord coming in four times a year to do a "maintainer inspection" and poking around in my stuff, then not actually fixing anything that is broken. When I own my home, I see lots of positives... and I do not see myself as being tied down. I don't get where people think there is so much freedom to renting. The pain in the butt paperwork and all the deposits and money you have to spend, not to mention the hunt for a decent apartment itself, either on your own or with an management company that just sees you as another cog in the machine and treats you as the disposable commodity that you are as a renter. A home does not tie you down. If I want to move or have to move, I can sell it. If it doesn't sell, I can rent it. And if I go into that world of being a landlord, I will do my best to not be the money hungry corner cutting scumbags most landlords and property management companies I have seen seem to be. I do not see what I am buying as an investment or as an ATM in the future. I see my new home as that... my home. Mine. Not the property management home, not the landlords investment income stream... it is my home. And that is a good feeling. I have to live somewhere anyway... it may as well be mine, not belong to someone else. Returns on investments or financial calculators or other financial mumbo jumbo be damned. As a person who has rented for many years, I find the arguments that renting is better amusing. Several people have said that when they had something break, it was the landlords problem and the landlord fixed it. I have rented from both companies and from individuals, and I would love to know where you people are renting who don’t have greedy landlords who will turn the blame on everything to you. I have time and time again had landlords force me to fix or pay to fix stuff that was supposed to be covered by them in the lease. Why? Because they know they have the bully pulpit in the situation. Landlords have the money, the time, and more legal widgets on their side than renters… so they can get away with screwing over renters. Heck I am in a debate with my current landlord over fixing a blade on a vertical blind. They even acknowledged it was normal wear and tear as stated in the lease… but they have refused to fix it until I move out, and they want to take it out of my security deposit.

With other landlords, I have gone weeks or months without repairs on wiring and appliances. I have even had the heat go out and had to actually threaten getting the state involved since that is a legal thing the apartment was required to have to get the landlord to fix it… but boy did they take their sweet time. Again, you people who get things replaced the next day are very very very lucky. You might consider taking some of that good fortune and cashing in at the local casino…

If I am going to have to pay for repairs, I would rather do so on my own property. Which, if things go well with the paperwork, I will start doing on the 19th of this month. Yes… the market finally got low enough and I am buying a home. I look forward to home ownership and my (hopefully) last dealing with landlords when my lease ends at the end of the month.

When I own my new house, it is mine to do what I want with. I have dreams of changing ceiling fans and doing painting. And I can do all that. I will not have a landlord coming in four times a year to do a “maintainer inspection” and poking around in my stuff, then not actually fixing anything that is broken.

When I own my home, I see lots of positives… and I do not see myself as being tied down. I don’t get where people think there is so much freedom to renting. The pain in the butt paperwork and all the deposits and money you have to spend, not to mention the hunt for a decent apartment itself, either on your own or with an management company that just sees you as another cog in the machine and treats you as the disposable commodity that you are as a renter. A home does not tie you down. If I want to move or have to move, I can sell it. If it doesn’t sell, I can rent it. And if I go into that world of being a landlord, I will do my best to not be the money hungry corner cutting scumbags most landlords and property management companies I have seen seem to be.

I do not see what I am buying as an investment or as an ATM in the future. I see my new home as that… my home. Mine. Not the property management home, not the landlords investment income stream… it is my home. And that is a good feeling. I have to live somewhere anyway… it may as well be mine, not belong to someone else. Returns on investments or financial calculators or other financial mumbo jumbo be damned.

]]> By: CPM http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-690797 CPM Tue, 09 Jun 2009 06:10:39 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-690797 Above: Should have gotten your home inspected or perhaps done a little research before purchasing your home. Further Above: If the couple $100/mo, taxes (oh no!) and maintenance is the deciding factor to becoming a homeowner, then please stay where you are. An industry thrives off of people like you.... oh an cover those holes before you move out too! Plus, if you cannot pay those awful taxes, maintain your property, become foreclosed...etc. others property values would take a hint. So, just stay where you are until your contract is up and leave with a year of your investible life gone and probably your deposit. Above: Should have gotten your home inspected or perhaps done a little research before purchasing your home.

Further Above: If the couple $100/mo, taxes (oh no!) and maintenance is the deciding factor to becoming a homeowner, then please stay where you are. An industry thrives off of people like you…. oh an cover those holes before you move out too!

Plus, if you cannot pay those awful taxes, maintain your property, become foreclosed…etc. others property values would take a hint. So, just stay where you are until your contract is up and leave with a year of your investible life gone and probably your deposit.

]]> By: Renter from Seattle, WA http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-675392 Renter from Seattle, WA Thu, 28 May 2009 04:27:37 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-675392 Hmm. I do not agree with this article; 1. I know what's like owning liquid assets vs home. Yes, deicison is with buyers to sell the home when they choose to; tell me the response time, turaround time, sleppless nights one needs to go through to sell this home. StarWars Collectible- Go eBay- get the best price while you watch StarWarsin your HD. It's not that simple- click a button and sell your home. 2. Argument on 650 vs 850 vs 888 etc .. it's just flawed. For the first 15 years or so, I do have an edge of $ 200 per month + taxes and other maintenance headache- I don't need to take. If I put all that amount in inflation adjusted treasury securities, I can get handsome return that helps me payoff my perpetually increasing return. And remember, this home owner is not done after 30 years. When's the last tiem you considered living in a home built in 1980- old fashioned model and waiting for that snow to break your damaged ceiling. You need to keep pouring 10000s of dollars to maintain that home. Hmm. I do not agree with this article;
1. I know what’s like owning liquid assets vs home. Yes, deicison is with buyers to sell the home when they choose to; tell me the response time, turaround time, sleppless nights one needs to go through to sell this home. StarWars Collectible- Go eBay- get the best price while you watch StarWarsin your HD. It’s not that simple- click a button and sell your home.

2. Argument on 650 vs 850 vs 888 etc .. it’s just flawed. For the first 15 years or so, I do have an edge of $ 200 per month + taxes and other maintenance headache- I don’t need to take. If I put all that amount in inflation adjusted treasury securities, I can get handsome return that helps me payoff my perpetually increasing return. And remember, this home owner is not done after 30 years. When’s the last tiem you considered living in a home built in 1980- old fashioned model and waiting for that snow to break your damaged ceiling. You need to keep pouring 10000s of dollars to maintain that home.

]]> By: Josh Moore http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-672999 Josh Moore Mon, 25 May 2009 10:20:50 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-672999 Although it might be slightly different in Australia (we don't get tax deductions on PPOR) I think Steve McKnight had some useful insights on this debate a few years back: http://www.wealthtipsonline.com.au/pwt/pwt5.html Although it might be slightly different in Australia (we don’t get tax deductions on PPOR) I think Steve McKnight had some useful insights on this debate a few years back: http://www.wealthtipsonline.com.au/pwt/pwt5.html

]]> By: Cathy http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-663405 Cathy Fri, 15 May 2009 14:57:19 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-663405 I see some of your points but I don't agree with most of them. I am a renter who does invest a substantial portion of my money. Yes we have a negative savings as Americans but there are still some like me that do save. Granted our whole system seems to be set up as a big disadvantage to savers so I'm not surprised most people don't save. Not all costs can be passed on to renters as you say. They have to charge what the market will bear. My rent has stayed flat this year and I will be finding a cheaper place next year. So the 4% increase per year is not true. Also I've run the numbers for me. I am better off since I rented from 2002 (when I started looking) to the present. I almost bought a home that is now worth 50K less than what I offered. That pays for many years of 'free' rent and I don't see it re gaining it's value any time soon. In my many years of renting I have missed out on having a nice quiet home with plenty of room. But I have gained not having to mow a lawn or fix things and in my case I've also saved a lot of money! I see some of your points but I don’t agree with most of them.

I am a renter who does invest a substantial portion of my money. Yes we have a negative savings as Americans but there are still some like me that do save. Granted our whole system seems to be set up as a big disadvantage to savers so I’m not surprised most people don’t save.

Not all costs can be passed on to renters as you say. They have to charge what the market will bear. My rent has stayed flat this year and I will be finding a cheaper place next year. So the 4% increase per year is not true.

Also I’ve run the numbers for me. I am better off since I rented from 2002 (when I started looking) to the present. I almost bought a home that is now worth 50K less than what I offered. That pays for many years of ‘free’ rent and I don’t see it re gaining it’s value any time soon.

In my many years of renting I have missed out on having a nice quiet home with plenty of room. But I have gained not having to mow a lawn or fix things and in my case I’ve also saved a lot of money!

]]> By: Jay http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-646191 Jay Thu, 30 Apr 2009 15:33:34 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-646191 Trent, You're an idiot. I have never seen a mortgage + taxes + insurance + repairs + basic upkeep price on a house come anywhere close to the equivalent rental. When you're saving and investing 100s of dollars each month, you will always come out ahead. It doesn't even matter if your rent goes up each year (your salary should be going up by the same percentage each year anyways). By the time you hit retirement, your net worth will be so valuable that the interest alone will more than cover any rental price. If you want to buy a house then, go for it and pay it off in cash with pleanty of money to spare I might add. You sound like the typically fool who gets duped into buying a house. "Just pay more every month to get more equity"...can you hear yourself? You're already paying more just to live in the house. Now you're going to pay even more (which means less to invest in something that actually has a decent return)? Houses return a pathetic percentage after inflation. You could buy a CD that does better. You also can't get any of your "equity" without selling the house. Sorry, no equity loans - taking on more debt does not count as wealth. If you use a house as an investment tool, you will never actually have a liquid investment. The best investments are liquid, have low expense ratios, and good returns. A house has none of these. Talk to someone with some education instead some fool trying to make money off of you buy selling you a house. I'm sure a salt salesmen will tell you how great salt is too...they're trying to sell it. Use your head. Nowhere in your rambling did you say anything that even comes close to a rational thought. I award you no points, and may God have mercy on your soul. Jay, Ph.D Financial Accountant Trent,

You’re an idiot. I have never seen a mortgage + taxes + insurance + repairs + basic upkeep price on a house come anywhere close to the equivalent rental. When you’re saving and investing 100s of dollars each month, you will always come out ahead. It doesn’t even matter if your rent goes up each year (your salary should be going up by the same percentage each year anyways). By the time you hit retirement, your net worth will be so valuable that the interest alone will more than cover any rental price. If you want to buy a house then, go for it and pay it off in cash with pleanty of money to spare I might add.

You sound like the typically fool who gets duped into buying a house. “Just pay more every month to get more equity”…can you hear yourself? You’re already paying more just to live in the house. Now you’re going to pay even more (which means less to invest in something that actually has a decent return)? Houses return a pathetic percentage after inflation. You could buy a CD that does better.

You also can’t get any of your “equity” without selling the house. Sorry, no equity loans – taking on more debt does not count as wealth. If you use a house as an investment tool, you will never actually have a liquid investment.

The best investments are liquid, have low expense ratios, and good returns. A house has none of these. Talk to someone with some education instead some fool trying to make money off of you buy selling you a house. I’m sure a salt salesmen will tell you how great salt is too…they’re trying to sell it. Use your head.

Nowhere in your rambling did you say anything that even comes close to a rational thought. I award you no points, and may God have mercy on your soul.

Jay, Ph.D
Financial Accountant

]]> By: Andrey Naumov http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-639001 Andrey Naumov Thu, 23 Apr 2009 20:23:34 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-639001 Quote: "Let’s jump ahead to the thirty year mark. The homeowner sends in his last mortgage payment and now has to pay $0 a month. The renter, on the other hand, has seen his rent go from $600 a month to $1,950 a month" oh, how nice of you to first notice that the renter pays taxes as part of monthly payment, then to say that the owner does not pay a dime after the last mortgage payment. Consider this: monthly property tax is modest $200. Renter already pays it as part of monthly payment. Owner should pay $200 on top of $850. More over $200 is most probably will grow at least with inflation rate. In your example $200 will become $650 at the time of last mortgage payment. Don't forget maintenance costs growing with inflation too. In fact not only maintenance cost grows at inflation rate, its base is expanding too due to aging of the house. I think that the renting and owning expenses are about the same on 30-40 years run and buy vs rent decision should be based more on one's lifestyle than on pure financial reasons. Quote: “Let’s jump ahead to the thirty year mark. The homeowner sends in his last mortgage payment and now has to pay $0 a month. The renter, on the other hand, has seen his rent go from $600 a month to $1,950 a month”

oh, how nice of you to first notice that the renter pays taxes as part of monthly payment, then to say that the owner does not pay a dime after the last mortgage payment.

Consider this: monthly property tax is modest $200. Renter already pays it as part of monthly payment. Owner should pay $200 on top of $850. More over $200 is most probably will grow at least with inflation rate. In your example $200 will become $650 at the time of last mortgage payment. Don’t forget maintenance costs growing with inflation too. In fact not only maintenance cost grows at inflation rate, its base is expanding too due to aging of the house.

I think that the renting and owning expenses are about the same on 30-40 years run and buy vs rent decision should be based more on one’s lifestyle than on pure financial reasons.

]]> By: kevin http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/comment-page-4/#comment-636707 kevin Wed, 22 Apr 2009 02:35:35 +0000 http://www.thesimpledollar.com/2008/03/19/the-nonsense-of-rent-vs-buy-myths-that-ruined-the-housing-market/#comment-636707 Hey this blog is excellent! I have been a renter for many years on short term leases and I've owned 2 homes. I'm now divorced with no kids and in my 40's and renting again. I live in a studio unit of a big farm house just outside Philly in a quaint environment and pay about$1000/month rent for everything includes cable/elec/heat/ac and is fully furnished.I love the place but I have been wavering back and forth about wether to buy again and pay into an investment rather than paying someone's mortgage. My sister is a realtor and I've got great credit/a nice savings and IRA/CD's and been pre-approved for a new mortgage but in reading these heelpful discussions I am torn about what I want to do. My big picture is I can retire in under 20 years/ have a small pension and social security and if my present savings gains just 4% interest over the next 20 years with not 1$ more additional I would have in excess of $450k plus my retirement benefits. I have lived in Philly all my life but like to travel and do things I enjoy. I just need a few words of wisdom from some of you out there as to what you would do if in my case with no kids. The home my wife and I previuosly owned is paid off. All your suggestions will be appreciated! Thanks Hey this blog is excellent! I have been a renter for many years on short term leases and I’ve owned 2 homes. I’m now divorced with no kids and in my 40′s and renting again. I live in a studio unit of a big farm house just outside Philly in a quaint environment and pay about$1000/month rent for everything includes cable/elec/heat/ac and is fully furnished.I love the place but I have been wavering back and forth about wether to buy again
and pay into an investment rather than paying someone’s mortgage. My sister is a realtor and I’ve got great credit/a nice savings and IRA/CD’s and been pre-approved for a new mortgage but in reading these heelpful discussions I am torn about what I want to do. My big picture is I can retire in under 20 years/ have a small pension and social security and if my present savings gains just 4% interest over the next 20 years with not 1$ more additional I would have in excess of $450k plus my retirement benefits. I have lived in Philly all my life but like to travel and do things I enjoy. I just need a few words of wisdom from some of you out there as to what you would do if in my case with no kids. The home my wife and I previuosly owned is paid off.
All your suggestions will be appreciated! Thanks

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