Author Topic: The Benefits of Home Ownership?  (Read 5271 times)

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Offline Jarlaxle

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Re: The Benefits of Home Ownership?
« Reply #70 on: April 10, 2015, 12:23:21 AM »
Your guys' housing market is so cheap. A condo where I am (Saskatchewan, Canada) would run you anywhere frm 180k to 250k. And you can't get a house cheaper than 300k, unless you want to live in Stabsville.

Offline eric42434224

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Re: The Benefits of Home Ownership?
« Reply #71 on: April 10, 2015, 06:59:29 AM »
Your guys' housing market is so cheap. A condo where I am (Saskatchewan, Canada) would run you anywhere frm 180k to 250k. And you can't get a house cheaper than 300k, unless you want to live in Stabsville.

You are neglecting the exchange rate between US and Canadian Dollar.
300k in Canada is 238k in US.  Big Difference.


And $297k is the average house price in Saskatchewan, Canada.
The average adjusted to Canadian Dollars house price in Ft. Lauderdale, FL is $358k

I think your market is the cheap one
« Last Edit: April 10, 2015, 07:22:14 AM by eric42434224 »
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Offline Stadler

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Re: The Benefits of Home Ownership?
« Reply #72 on: April 10, 2015, 08:05:02 AM »
...and we could have, with everything including HOA payments, been paying like $1100 a month. Right now we pay $1350 a month in rent.

Here was the eye-opener for me:  granted, he has additional risk (which is why the premium), but every five months, you're giving him one whole additional mortgage payment. 

Offline cramx3

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Re: The Benefits of Home Ownership?
« Reply #73 on: April 10, 2015, 08:22:24 AM »
...and we could have, with everything including HOA payments, been paying like $1100 a month. Right now we pay $1350 a month in rent.

Here was the eye-opener for me:  granted, he has additional risk (which is why the premium), but every five months, you're giving him one whole additional mortgage payment.

And that extra payment every five months goes a long way to paying less interest!  No penalties for paying more on the mortgage so if you can afford to, its a good place to put your money.

Offline eric42434224

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Re: The Benefits of Home Ownership?
« Reply #74 on: April 10, 2015, 08:28:41 AM »
...and we could have, with everything including HOA payments, been paying like $1100 a month. Right now we pay $1350 a month in rent.

Here was the eye-opener for me:  granted, he has additional risk (which is why the premium), but every five months, you're giving him one whole additional mortgage payment.

And that extra payment every five months goes a long way to paying less interest!  No penalties for paying more on the mortgage so if you can afford to, its a good place to put your money.

Paying down the mortgage is not always the smartest.  If you have a low rate, coupled with tax deuctions, the cost of leveraging the banks money to get the equity of the appreciating asset is just too low to not use.  The extra income stream from the rental would be better served in long term investments (tax deferred retirement if they are allowed).  A properly constructed, asset allocated portfolio, where one dollar cost averages in, will out perform the benefits of paying down a mortgage early in most scenario.s
But you never know the actual scenario of the owner.  Paying down a mortgage early sounds great, b ut it is not always the most efficient thing to do.
Having accessible funds in retirement is easier than having to tap the equity in your properties.
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Offline cramx3

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Re: The Benefits of Home Ownership?
« Reply #75 on: April 10, 2015, 08:34:26 AM »
...and we could have, with everything including HOA payments, been paying like $1100 a month. Right now we pay $1350 a month in rent.

Here was the eye-opener for me:  granted, he has additional risk (which is why the premium), but every five months, you're giving him one whole additional mortgage payment.

And that extra payment every five months goes a long way to paying less interest!  No penalties for paying more on the mortgage so if you can afford to, its a good place to put your money.

Paying down the mortgage is not always the smartest.  If you have a low rate, coupled with tax deuctions, the cost of leveraging the banks money to get the equity of the appreciating asset is just too low to not use.  The extra income stream from the rental would be better served in long term investments (tax deferred retirement if they are allowed).  A properly constructed, asset allocated portfolio, where one dollar cost averages in, will out perform the benefits of paying down a mortgage early in most scenario.s
But you never know the actual scenario of the owner.  Paying down a mortgage early sounds great, b ut it is not always the most efficient thing to do.
Having accessible funds in retirement is easier than having to tap the equity in your properties.

Assuming the interest rate is low (which they are now) then yes, money could be put in better places, but if you owe a lot on a house, even with a low rate, you are still paying a lot of money in interest that you could be saving.  Also for me or others who used an FHA loan, getting to that 20% equity is a goal because you wont have to pay that extra PMI every month which comes out to ~$150 for me.

Offline eric42434224

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Re: The Benefits of Home Ownership?
« Reply #76 on: April 10, 2015, 08:55:54 AM »
Agreed on the rate.  But it would be reasonable to assume that the property owner refinanced during the past few years and has a good rate.  Also, the majority of income property owners wont buy on FHA, and most wouldnt pay PMI.  I am sure some do and are landlords by necessity and circumstance, but most that own income properties dont.

But to answer you, it does all depend on the individual circumstances.  But the countless times I advise clients on these matters, when the numbers are run, it is usually advised that they do not pay down the mortgage.
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Offline JayOctavarium

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Re: The Benefits of Home Ownership?
« Reply #77 on: April 10, 2015, 09:02:12 AM »
The guy who owns the place I rent bought it in cash a couple years ago and plans on renting it out for a few years and then flipping it.
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Offline kirksnosehair

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Re: The Benefits of Home Ownership?
« Reply #78 on: April 10, 2015, 01:14:55 PM »
I will admit that a lot of my hesitation toward home owning may stem from a lack of education on personal finance issues. I know how to balance my own budget, but I'm certainly not very knowledgeable on what I should pay for things, how I should go about getting loan, what kind of loan I should get, what I should put down, etc. I guess I should get educated. Easier said than done, though. Part of what's so scary to me is the risk of it all. As a first time home buyer who's also on his first real job, I don't want to make a mistake and I don't want to get ripped off, and I definitely don't want to get in over my head. Unfortunately those are all things which realtors don't seem to care much about. Oh well. I guess I'll figure it out. Slow and steady wins the race, I suppose, and it won't kill me to rent while I try and figure out what's best for me.


I've purchased 2 homes in the last 15 years.  The first one was a 1000 sq ft cottage that cost $172,900 and I'd estimate that we put $20k into upgrades and repairs over the 12 years that we owned it.  I leased apartments before buying the first house.  The last lease we had on a 1 bedroom/1 bath apartment was $1100/month, that was in October of 2000.  When we moved into the first home we bought our mortgage/taxes/etc totaled about $1300/month, so our rent went up, but we went from living in about 600 sq ft to 1000 and that felt HUGE. (for about a week  :facepalm:  )




So anyway, that $1300/month lease was in 2000.  We moved into the house in October of 2000.  On the day we moved out of that house, the exact same apartment that we had lived in prior to the home was leased for $1750/month.  In 12 years of paying the full mortgage payment + $500 every month, by the time we sold the house ($223k) we had accumulated a LOT of equity ($140k) and it was that equity that allowed us to buy the home we live in now, which has more than 3 times the space the last one had.  It's also only about 30 years old.  The other one was 75 years old.


I felt the same way about buying a home that you feel, Skeever.  I was skeptical.  And afraid of getting myself in a big jam that I wouldn't be able to get myself out of.  But the wife and I took the plunge into home ownership and it was probably one of the best things we've ever done to lift ourselves up/challenge ourselves.  There is always going to be some measure of risk in buying a home, but overall I still believe it's the most reliable way to build wealth that average people have available to them.  And to have the benefit of living within the vehicle that is building that wealth for you, it's a win-win and imho it's a no-brainer.  You are practically guaranteed to come out ahead if you buy a home and stay in it for 5+ years.  And the longer you stay the more of the house you own.  Eventually you can borrow against that equity and that gives you a nice way to fund projects to improve your home, which increase the value of your investment...


For me, especially now with the benefit of hindsight, I'd say the benefits of home ownership far outweigh the negatives.  That's been my personal experience.  YMMV




Offline gmillerdrake

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Re: The Benefits of Home Ownership?
« Reply #79 on: July 24, 2015, 08:06:54 AM »
this seemed like the most appropriate thread to post this in. I built a small landscape stone wall on our front porch. Every home in our subdivision has these PVC clean out pipes for our sewer...in the front yard, so I've been wanting to hide it. I still need to back fill with dirt...cut the pipe down and then grab some vegetation....but I'm so glad to have this out of the way. After getting the materials in the morning at LOWES ($308.78 worth) and then getting it unloaded at home, I started just at noon. Finished up right around 7:00 pm. Long day, but as I said....happy to have this done.

















(zoomed in...yeah, that's level  :tup)










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Offline cramx3

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Re: The Benefits of Home Ownership?
« Reply #80 on: July 24, 2015, 08:17:08 AM »
Cool, nice job!  Your street looks like something out of a movie where all the houses are very similar and all clean cut.

Are you going to put plants in there once its backfilled? 

Offline gmillerdrake

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Re: The Benefits of Home Ownership?
« Reply #81 on: July 24, 2015, 08:36:50 AM »
Cool, nice job!  Your street looks like something out of a movie where all the houses are very similar and all clean cut.

No kidding. That side of the street is very conducive for the 'walk out' basements. The builder offers several different Ranch floor plans but it seems that out of the 20+ homes on that side of the street near all of them chose the same floor plan with similar outdoor finishes. The side of the street I'm on has more 2 story homes. But, they are all very clean and nice looking and what I like is that the Post Office has set up all our mailboxes in one location at the front entrance....so there isn't a mish mash of mailbox designs down the street and it looks more 'open'.

Are you going to put plants in there once its backfilled?

Oh yeah, just don't know what yet. Gonna get it filled in and then start looking in to that.
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Offline kingshmegland

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Re: The Benefits of Home Ownership?
« Reply #82 on: July 24, 2015, 01:57:24 PM »
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Offline Skeever

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Re: The Benefits of Home Ownership?
« Reply #83 on: July 24, 2015, 06:53:45 PM »
Wow, this thread got bumped.

Anyway, you guys might not believe it, but I'm a homeowner now.

Turns out my previous realtor blew in most ways imaginable. After "giving up" here, I contacted a new realtor a few days later who found me a new place in a matter of weeks. She actually explained things to me, helped me find an area I could afford, and was there every step of the way through my settlement process.

To the people who didn't believe me, I can now confirm that taxes are every bit as high in jersey as I claimed initially (suck it, eric) (jk). But still, it's been worth it so far. Yeah I'm paying about $300~ more than I was renting when you factor taxes in, but I can handle it, and it feels so much better to come home to a my own place as night.

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Re: The Benefits of Home Ownership?
« Reply #84 on: July 24, 2015, 08:43:44 PM »
Nice job Gary.  Levelling out that elevation look so much more natural against your front porch.  Well done.  :tup
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Re: The Benefits of Home Ownership?
« Reply #85 on: July 25, 2015, 01:18:10 AM »
Nice Gary... and the pup!  :D

Wow, this thread got bumped.

Anyway, you guys might not believe it, but I'm a homeowner now.

Turns out my previous realtor blew in most ways imaginable. After "giving up" here, I contacted a new realtor a few days later who found me a new place in a matter of weeks. She actually explained things to me, helped me find an area I could afford, and was there every step of the way through my settlement process.

To the people who didn't believe me, I can now confirm that taxes are every bit as high in jersey as I claimed initially (suck it, eric) (jk). But still, it's been worth it so far. Yeah I'm paying about $300~ more than I was renting when you factor taxes in, but I can handle it, and it feels so much better to come home to a my own place as night.

Congrats!

My condo is feeling more and more like home- I've gotten some cool furniture and it's decorated just as weirdly as you guys would expect :lol... still trying to find more ways to make it homey, where to put things, etc. but it's getting there. And I have to say, though it would be nice to have a yard and a bit more privacy, I'm REALLY glad I don't have all the responsibility of a house. Maybe if I lived with somebody else, but no way I would be able to keep that shit up on my own.
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Offline gmillerdrake

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Re: The Benefits of Home Ownership?
« Reply #86 on: July 26, 2015, 08:14:46 PM »
Tomorrow's project..... :tup


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Offline Chino

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Re: The Benefits of Home Ownership?
« Reply #87 on: July 27, 2015, 06:51:26 AM »
To the people who didn't believe me, I can now confirm that taxes are every bit as high in jersey as I claimed initially (suck it, eric) (jk). But still, it's been worth it so far. Yeah I'm paying about $300~ more than I was renting when you factor taxes in, but I can handle it, and it feels so much better to come home to a my own place as night.

Not to mention that you have an asset you can sell.

Offline Calvin6s

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Re: The Benefits of Home Ownership?
« Reply #88 on: July 27, 2015, 07:45:23 AM »
Not to mention that you have an asset you can sell.

And every improvement adds value to your use of the house as well as increasing that asset value.  I don't own my business office and I can't tell you how many decisions are made with a necessary 2-3 year RoI to even be considered.  What if I pay for solar panels and the landlord decides they can now charge more $/SF and raises the rent as high as legally possible.  I'm paying for the improvement twice.  And if I leave, I'm abandoning the investment before it pays for itself.  And you can remove the improvements you made, but it becomes more of a grudge thing at that point as you've already paid labor (and/or time of install).

Same concept with home ownership.
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Offline Chino

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Re: The Benefits of Home Ownership?
« Reply #89 on: July 27, 2015, 07:55:00 AM »
Not to mention that you have an asset you can sell.

And every improvement adds value to your use of the house as well as increasing that asset value.  I don't own my business office and I can't tell you how many decisions are made with a necessary 2-3 year RoI to even be considered.  What if I pay for solar panels and the landlord decides they can now charge more $/SF and raises the rent as high as legally possible.  I'm paying for the improvement twice.  And if I leave, I'm abandoning the investment before it pays for itself.  And you can remove the improvements you made, but it becomes more of a grudge thing at that point as you've already paid labor (and/or time of install).

Same concept with home ownership.

I feel bad in that regard when I think about buying my house. I bought it off an old Lady who acquired the house in January 2008. She rebuilt the fireplace, in 2014 and put in a new furnace in early 2015. She included over $10k worth of kitchen and laundry appliances with the sale. She finished the attic and added a second full bath. Every room was repainted and she built a patio out back as well. I bought it for $2000 more than she did in 2008. I beat her up pretty good during negotiations, but I wasn't doing it to be an asshole. It was literally all the money I had and she didn't have to play ball.

Offline cramx3

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Re: The Benefits of Home Ownership?
« Reply #90 on: July 27, 2015, 08:10:15 AM »
Not to mention that you have an asset you can sell.

And every improvement adds value to your use of the house as well as increasing that asset value.  I don't own my business office and I can't tell you how many decisions are made with a necessary 2-3 year RoI to even be considered.  What if I pay for solar panels and the landlord decides they can now charge more $/SF and raises the rent as high as legally possible.  I'm paying for the improvement twice.  And if I leave, I'm abandoning the investment before it pays for itself.  And you can remove the improvements you made, but it becomes more of a grudge thing at that point as you've already paid labor (and/or time of install).

Same concept with home ownership.

I feel bad in that regard when I think about buying my house. I bought it off an old Lady who acquired the house in January 2008. She rebuilt the fireplace, in 2014 and put in a new furnace in early 2015. She included over $10k worth of kitchen and laundry appliances with the sale. She finished the attic and added a second full bath. Every room was repainted and she built a patio out back as well. I bought it for $2000 more than she did in 2008. I beat her up pretty good during negotiations, but I wasn't doing it to be an asshole. It was literally all the money I had and she didn't have to play ball.

On a personal level you feel bad, but that's cause you are a decent guy.  Can't hold yourself back though cause it's a business decision and you got to do what you got to to make it happen, same with her.  At the end of the day, you both agreed.

I bought my house from a very old lady as well.  She had just redone the roofing and she sold the house to me for 20k less than her asking price and then at closing we argued for another 1k for a few minor issues we found in the house that morning that we thought could be costly, although ended up not being costly, but we were close to walking away at that point because we felt like she was lying to us.  Regardless, I'm sure she didn't get the best deal out there and for that I feel bad for her, but I don't feel too bad because she did agree to it all and she got the benefit of not having to deal with people viewing her house (went on the market Friday, we had our agreement the next Monday) which was something she was outspoken about (and my Mother who was my real estate agent, used to effectively get her to settle for a lower price).  It's just business.

Offline jingle.boy

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Re: The Benefits of Home Ownership?
« Reply #91 on: July 27, 2015, 08:19:02 AM »
Would either of you feel bad if you got that kinda deal, or did those kind of negotiations with a non "old-lady"?  So long as you weren't cruel, disrespectful or manipulative, there's nothing to feel bad about in negotiating anything, with anyone.
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Offline Chino

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Re: The Benefits of Home Ownership?
« Reply #92 on: July 27, 2015, 08:27:48 AM »
Would either of you feel bad if you got that kinda deal, or did those kind of negotiations with a non "old-lady"?  So long as you weren't cruel, disrespectful or manipulative, there's nothing to feel bad about in negotiating anything, with anyone.

I think I'd still feel bad. I don't love the fact that I got someone else's $30K investment for free. Old lady definitely makes it worse though.

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Re: The Benefits of Home Ownership?
« Reply #93 on: July 27, 2015, 08:36:19 AM »
Old lady definitely adds to the feel bad part, and if I was her, I am not sure if I would feel bad or not.  Probably though, and our negotiations only got nasty about one issue that we felt like she was lying about and that same conversation came up when we found more evidence of her lies at the closing table, but even then it was really just the lawyers getting nasty.  There was never ill will from us or the old lady, like I said, it's just business. 

Offline Stadler

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Re: The Benefits of Home Ownership?
« Reply #94 on: July 27, 2015, 09:39:25 AM »
Maybe it's because I've done this so much (in process now of buying my sixth home) or because I a lawyer (no jokes please) but I left the "feel bad" thing behind long ago, for several reasons.  One, the "investment" is purely subjective.  When it comes to homes everyone has their "personal issues", meaning some of those "investments" aren't really.  Just because you spend "$x" dollars on a house doesn't mean that the value goes up the same amount.   In fact, more often than not, it has little if any effect.   Two, can't speak for your case, but in mine (also buying from an elderly couple, been in the house 45 years!!) there are agents and lawyers on both sides, and in fact I played HARDER ball because of the presence of the agent.  I don't know if she felt some obligation to the couple to be a pitbull, but she was totally obnoxious and on several occasions was abusive to our agent.   So for me, gloves were off.  Three, she set the price, and she - as a presumably able and competent adult - had the right at any time to say "no deal". 

Seriously, if you feel that bad and you want to make right, do it on the side out of the transaction, but within the terms of the home purchase you owe it to yourself and your family to cut the best deal you can.  You only have one shot at it (outside of re-financing). 

Offline jasc15

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Re: The Benefits of Home Ownership?
« Reply #95 on: July 27, 2015, 02:07:06 PM »
If you really want a house and can afford* one , then buy one, but don't fool yourself into thinking it is a smart investment.  Don't try to time the mortgage interest rates either.  People are paid lots of money and spend their entire careers trying to do that and still can't.  Don't be concerned about the house losing value, because you shouldn't be selling it in a time frame where that is likely to matter.

*i.e., 20% down payment, <28% of cash flow for mortgage payment, and <36% of cash flow for total debt payments, though I intend on having those percentages much less in my case.

A glib, but useful thought on home buying I once came across:

Quote
Owning home is like having an unpaid part-time job working for the bank maintaining their investment. When the mortgage is paid, you get a house that is 30 years older and in need of more repair.

my $.02

Offline cramx3

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Re: The Benefits of Home Ownership?
« Reply #96 on: July 27, 2015, 02:16:27 PM »
Like an investment there are risks and market conditions that are out of your control.  Regardless, from my understanding, owning a home is one of the better investments, not because of the profit, but because you get to live there and historically owning the house does give a monetary return besides the emotional return.  Also, timing the mortgage interest helped me save money on my loan.

Offline Calvin6s

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Re: The Benefits of Home Ownership?
« Reply #97 on: July 27, 2015, 02:49:14 PM »
I feel bad in that regard when I think about buying my house.

On a related but separate issue, when I bought a house for the sole purpose of reselling it at a higher rate during the Bush years, I had a friend that gave me "that is what makes it so guys like me can never afford a house."

This person is almost old enough to be my father.  And even though what he says holds merit, it is the thinking of an idealistic teenager (and this dude is not stupid).  Me not buying and selling a house is not going to change the marketplace.  It just means I'm going to get old and bitter grumbling how I had my principles.  I could have been financial secure, but I won't sell my soul in the process.  And I would probably be telling this in some sort of government line for financial support.  If you can see an opportunity and you aren't doing anything illegal, you should do it.  If you don't, somebody else will just fill your spot.

On the flip side, I managed to not be left holding any property other than my own residence in 2008.  I even had thoughts (correctly) that I could sell the house for what would be 2 to 3x the value by 2009-2010 and then buy one or even two houses outright.  It would have worked.  And every hunch I had was correct on timing.  But there is something about putting your own home on the gambling table.  What if I was wrong.  And the market just kept going up and I was priced out.  The downside was a long shot, but no matter how confident you are, once you get into the home market, it is very scary to actually get back out.  Sometimes fear wins out over all your instincts no matter how well they have served you.
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Offline Stadler

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Re: The Benefits of Home Ownership?
« Reply #98 on: July 28, 2015, 07:34:54 AM »
If you really want a house and can afford* one , then buy one, but don't fool yourself into thinking it is a smart investment.  Don't try to time the mortgage interest rates either.  People are paid lots of money and spend their entire careers trying to do that and still can't.  Don't be concerned about the house losing value, because you shouldn't be selling it in a time frame where that is likely to matter.

*i.e., 20% down payment, <28% of cash flow for mortgage payment, and <36% of cash flow for total debt payments, though I intend on having those percentages much less in my case.

A glib, but useful thought on home buying I once came across:

Quote
Owning home is like having an unpaid part-time job working for the bank maintaining their investment. When the mortgage is paid, you get a house that is 30 years older and in need of more repair.

my $.02

That's "Twitter thinking" (used to be "Bumper-sticker thinking" back in the day), meaning, trying to shoehorn and over-simplify a concept that is for better or worse far more complex than it seems down to something quippy for Twitter.  Your quote sounds good, but doesn't hold water under more intense (read: ANY) scrutiny. 

That something is hard to do, and not a 100% sure thing doesn't make it "bad".   

Offline jasc15

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Re: The Benefits of Home Ownership?
« Reply #99 on: July 28, 2015, 08:52:20 AM »
That's "Twitter thinking" (used to be "Bumper-sticker thinking" back in the day), meaning, trying to shoehorn and over-simplify a concept that is for better or worse far more complex than it seems down to something quippy for Twitter.  Your quote sounds good, but doesn't hold water under more intense (read: ANY) scrutiny. 

That something is hard to do, and not a 100% sure thing doesn't make it "bad".   
Which is why it is not the basis of my point.  It was a "glib" comment which I added after making my point.

Offline Stadler

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Re: The Benefits of Home Ownership?
« Reply #100 on: July 28, 2015, 12:00:08 PM »
That's "Twitter thinking" (used to be "Bumper-sticker thinking" back in the day), meaning, trying to shoehorn and over-simplify a concept that is for better or worse far more complex than it seems down to something quippy for Twitter.  Your quote sounds good, but doesn't hold water under more intense (read: ANY) scrutiny. 

That something is hard to do, and not a 100% sure thing doesn't make it "bad".   
Which is why it is not the basis of my point.  It was a "glib" comment which I added after making my point.

But (respectfully), while you did acknowledge it was "glib", you also said it was "useful" - it is not - and, glib or not, it was in keeping with the remainder of your post, which I - again respectfully - disagree with. 

Offline carl320

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Re: The Benefits of Home Ownership?
« Reply #101 on: September 16, 2015, 12:12:06 PM »
Bump, since I've officially began the process of buying a house.  I was pre-approved for a loan through a local credit union today, which (I didn't realize until recently) I should have done before looking at houses.  Never mind that technicality.

No questions (as of now).  Kind of nervous, kind of excited.  Looking forward to finding out what's out there.
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Offline cramx3

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Re: The Benefits of Home Ownership?
« Reply #102 on: September 16, 2015, 12:27:08 PM »
Good luck and check out as much as you can, get different quotes, and hopefully you find a great home

Offline Calvin6s

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Re: The Benefits of Home Ownership?
« Reply #103 on: September 16, 2015, 04:59:30 PM »
I was pre-approved for a loan through a local credit union today, which (I didn't realize until recently) I should have done before looking at houses.

It isn't mandatory, but it gives you leverage and keeps you from rushing the loan price to get a house you *have to have*.

Don't be afraid to reject a loan offer (although in this economy, it probably is tougher to do now).  The odds are there are going to be a few things in the long loan documents you won't like and will just have to accept.  But you don't have to accept everything thrown your way.  I know when I helped my parents sell their house (and use some of the proceeds to pay off the remainder of the old house), I spoke up about something they tried to include that would have added about $10,000+ in a prepayment penalty clause.  After a couple of phone calls, a couple of letters and a couple of predatory law #'s tossed their way, they waived it.  I remember telling the parents "you should have never signed this in the first place" and they said "it was the best loan we could get.  It was that or nothing."  This was about 15 years ago though, but most bad loans are simply because people sign anything put in front of them without realizing they can challenge parts of it.

Having a good relationship with your bank / credit union can help quite a bit as well.  There are tons of books on the process.

Oh, and when you are nearing the end or wrapping it up, the simultaneous feelings of "woo hoo" and "did I just bite off more than I can chew.  Is that fence 1/4" out of alignment?  I think I could have done better" are pretty normal.  After a few payments, it subsides.  And when your friend is mumbling about your rent going up, you will be jumping for joy.  Unless of course the bottom falls out of the market again and you have to wait 5-10 years just to gain back the value of your purchase.

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Offline Stadler

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Re: The Benefits of Home Ownership?
« Reply #104 on: September 17, 2015, 07:53:37 AM »
Couple things:  do NOT get intimidated by the loan process.  Ever since the market crash it has been an abomination to get a loan.   I have negotiated multiple contracts (commercially) in the $100MM range, and it was nothing like the paperwork I had to do for my recent loan.   I literally sent four 50+ page faxes (imagine the file size if I scanned THAT!) through the process.   

Second, Calvin is right:  as you near the end (and immediately after) your emotions are going to be like those balls on the cover of Octavarium.  Just remember, provided you pass the inspection (those are the best dollars you will ever spend, if you spend them right), there's very little that can't be fixed, repaired, made to look nice, with a little elbow grease and perhaps some help from your friends.

I know for me, I get great joy out of watching the principal go down month to month (even if it is slowly) and knowing I am putting money in my pocket.  Five to ten years isn't long to wait, especially since even with a GOOD market and accounting for moving costs and closing costs, five years is aggressive to see any real return.