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re: Home ownership losing importance as "American Dream"
Posted on 6/4/14 at 4:00 pm to TejasHorn
Posted on 6/4/14 at 4:00 pm to TejasHorn
Only an absolute fool rents long term. Call me out on it. IDGAF. We'll see who's lauging at retirement. Of course you can't be lazy or irresponsible to own a home, so I guess that rules out most renters anyway. Your landlord is thankful for your ignorance.
Posted on 6/4/14 at 4:23 pm to tysonslefthook
Can't believe this hasn't been posted yet
LINK
But the reality is the calculator is only as good as the assumptions you put into it. Unfortunately the two biggest variables are future home appreciation and rate of rent increases, both of which are unknowable. Actually the biggest variable is how long you'll stay in the house, which you do have some control over (but not total control).
Personally I wouldn't say I "hate" owning a home, but I sure don't love it. It ended with a higher note for a house I like less in a location I like less, along with the ever-boding dread of a six-figure liability lingering over my head like the sword of Damocles for the next few decades.
Also, when you've bought, that's where you are. Some people like this - a place to settle and call your own. But to me it's more like an anchor. I'm pretty ambivalent about the whole deal in case you can't tell
LINK
But the reality is the calculator is only as good as the assumptions you put into it. Unfortunately the two biggest variables are future home appreciation and rate of rent increases, both of which are unknowable. Actually the biggest variable is how long you'll stay in the house, which you do have some control over (but not total control).
Personally I wouldn't say I "hate" owning a home, but I sure don't love it. It ended with a higher note for a house I like less in a location I like less, along with the ever-boding dread of a six-figure liability lingering over my head like the sword of Damocles for the next few decades.
Also, when you've bought, that's where you are. Some people like this - a place to settle and call your own. But to me it's more like an anchor. I'm pretty ambivalent about the whole deal in case you can't tell
Posted on 6/4/14 at 4:34 pm to tysonslefthook
Real Estate investment has less standard deviation and higher return than the market.
Posted on 6/4/14 at 4:57 pm to tysonslefthook
There is one, and only one, financial reason to own a house: if you live in it past the date of your last mortgage payment, your only housing expenses will be taxes, insurance, and upkeep.
Many people do not live in a house long enough to get to that point.
I would be curious, all of you who think renting is not smart... how many of y'all are under the age of, say, 40?
It's a different world than it was 20 years ago. For many people, a house is an anchor. Anyone who purchased a house between 2000 - 2007 and tried to move out of town between 2007 - 2012 can attest to that.
Now there are many, many non-financial reasons to own a house: pride of ownership, ability to make changes, live in generally nicer neighborhoods, having a yard, etc.
Like others have said... your equity does build up... but there is a cost to that equity - the cost of major repairs and remodels. All of which you will never see any reimbursement from when and if you do sell the house.
Finally, the tax benefits of homeownership are dramatically oversold. With an increasing standard deduction and low interest rates, only a portion of your interest and taxes may be actually deductible. I have two young friends in their late 20s, both married, both recently purchased houses... and neither one of them can deduct a dime of interest and taxes... because adding them to their other itemized deductions is still less than the standard deduction.
With all that... I can see where many people are disallusioned "FINANCIALLY" with owning a home... or at least don't see it as the key to the American Dream that it once was.
Many people do not live in a house long enough to get to that point.
I would be curious, all of you who think renting is not smart... how many of y'all are under the age of, say, 40?
It's a different world than it was 20 years ago. For many people, a house is an anchor. Anyone who purchased a house between 2000 - 2007 and tried to move out of town between 2007 - 2012 can attest to that.
Now there are many, many non-financial reasons to own a house: pride of ownership, ability to make changes, live in generally nicer neighborhoods, having a yard, etc.
Like others have said... your equity does build up... but there is a cost to that equity - the cost of major repairs and remodels. All of which you will never see any reimbursement from when and if you do sell the house.
Finally, the tax benefits of homeownership are dramatically oversold. With an increasing standard deduction and low interest rates, only a portion of your interest and taxes may be actually deductible. I have two young friends in their late 20s, both married, both recently purchased houses... and neither one of them can deduct a dime of interest and taxes... because adding them to their other itemized deductions is still less than the standard deduction.
With all that... I can see where many people are disallusioned "FINANCIALLY" with owning a home... or at least don't see it as the key to the American Dream that it once was.
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