4 ms·

Multiple factors figure into why the rent is so high, but from a government policy standpoint, I'm interested in "the decision by consumers to rent over purchas

Multiple factors figure into why the rent is so high, but from a government policy standpoint, I'm interested in "the decision by consumers to rent over purchase" but what is more likely, that in spite of low mortgage rates, a number of buyers are not eligible for credit from private lenders. The other policy piece that I think is interesting is the private housing market's ability to deliver housing choices-- what are developers producing, are they producing luxury units, are they producing affordable options in high enough quantity, and are developers inhibited by government regulation in delivering a diversity of housing choices.

SlalomStallone 11y ago
I'm definitely in the "rent over purchase" group, even though I could get a mortgage with good terms. I think people are a bit nervous to purchase a home after seeing what happened in 2008.
- smoyer 11y ago
  I think it depends on where you're buying your house. The value of my house dipped slightly in 2008/2009 but is now about 12% higher than it was in 2007. Buying a home is still a good long-term investment but you have to be in a position to hold onto it (perhaps by renting it out after you vacate it).
  - SlalomStallone 11y ago
    Mostly the interest and upkeep that are keeping me away from purchasing. If I bought a 200k house, in 5 years I would have paid 43k in interest and still owe 180k on the mortgage (according to some amortization table I found), and probably many thousand more fixing stuff that breaks. After 30 years I will have paid $164,813 in interest, so even if the house doubles in value it doesn't seem like a great investment. Am I missing something? Maybe I'm not understanding it correctly but it doesn't seem like that great of a deal.
PopeOfNope 11y ago
in spite of low mortgage rates, a number of buyers are not eligible for credit from private lenders. It could possibly have something to do with the largest group that traditionally bought houses in the past are now too busy paying off their student loans.

SlalomStallone 11y ago

I'm definitely in the "rent over purchase" group, even though I could get a mortgage with good terms. I think people are a bit nervous to purchase a home after seeing what happened in 2008.

smoyer 11y ago
I think it depends on where you're buying your house. The value of my house dipped slightly in 2008/2009 but is now about 12% higher than it was in 2007. Buying a home is still a good long-term investment but you have to be in a position to hold onto it (perhaps by renting it out after you vacate it).
- SlalomStallone 11y ago
  Mostly the interest and upkeep that are keeping me away from purchasing. If I bought a 200k house, in 5 years I would have paid 43k in interest and still owe 180k on the mortgage (according to some amortization table I found), and probably many thousand more fixing stuff that breaks. After 30 years I will have paid $164,813 in interest, so even if the house doubles in value it doesn't seem like a great investment. Am I missing something? Maybe I'm not understanding it correctly but it doesn't seem like that great of a deal.

PopeOfNope 11y ago

in spite of low mortgage rates, a number of buyers are not eligible for credit from private lenders. It could possibly have something to do with the largest group that traditionally bought houses in the past are now too busy paying off their student loans.