4 ms·

Well, in some areas, but it really depends on the market - the property taxes on my home in a University city of 200,000 are 1/3 of what I was paying in rent -

by javanix 11y ago

Well, in some areas, but it really depends on the market - the property taxes on my home in a University city of 200,000 are 1/3 of what I was paying in rent - with the interest on my mortgage the amount of "lost" money comes out to roughly the same amount for now. As long as property taxes do not outstrip my interest rate, that ratio should stay in my favor going forward.

kazinator 11y ago
My yearly property tax is barely a bit more than half of what people pay for one month's rent for a similar place. Tax being 1/3rd of rent indicates rather low rents or rather high tax.
- javanix 11y ago
  Absurdly high taxes (my parents pay half my tax on a non-rural property twice as big about 120 miles north of me), but still, owning a home is hardly a fiscally ruinous proposition around here. My property taxes this year were ~$4200 on an average sized lot and home, or roughly $350/month. My last apartment cost $1050/month for a small two bedroom condo rental.
  - jandrese 11y ago
    This is similar to my situation. Renting a crappy 2BR apartment was $1700/month thanks to the tight rental market. Mortgage and taxes on a townhouse in a nicer part of town? $1200/month. And theoretically after 30 years I would have an asset I could sell, unlike the renters. Renting just didn't make sense unless you're highly itinerant and don't stick around any one area for more than a year or two.
    - schrodinger 11y ago
      What if you had rented and invested that 500/month (and the maintenance costs you had to pay along the way) in index funds?
      - jandrese 11y ago
        Uh, I was paying $500 more per month to rent than to own. Most people I know around here who bought a house saw their monthly payment go down. Also, it seems a bit odd to hedge against downturns in the housing market by investing in the stock market. The latter is far more volatile.
    - restalis 11y ago
      "Renting a crappy 2BR apartment was $1700/month thanks to the tight rental market. Mortgage and taxes on a townhouse in a nicer part of town? $1200/month." So you take a mortgage and you're happy and there is a chance that you'll stay happy because your present reckoning may remain as good in the future as it is now. But it also may not. By mortgaging you become a sitting duck against the change, and that rental business of $1700/month seems attractive enough to invite further involvement and development thus driving the prices much lower not only compared to its current figure but also with the praised rental figure. What would you do then if this happens? Refinance in order to stretch that mortgage for more than 30 years?
restalis 11y ago
"paying in rent - with the interest on my mortgage the amount of «lost» money comes out to roughly the same amount for now" But there is also the opportunity cost. Having a mortgage may be equivalent financially, but it's a liability when considering your freedom to change or to invest in something profitable that may pop up along the way.

by javanix 11y ago

kazinator 11y ago

My yearly property tax is barely a bit more than half of what people pay for one month's rent for a similar place. Tax being 1/3rd of rent indicates rather low rents or rather high tax.

javanix 11y ago
Absurdly high taxes (my parents pay half my tax on a non-rural property twice as big about 120 miles north of me), but still, owning a home is hardly a fiscally ruinous proposition around here. My property taxes this year were ~$4200 on an average sized lot and home, or roughly $350/month. My last apartment cost $1050/month for a small two bedroom condo rental.
- jandrese 11y ago
  This is similar to my situation. Renting a crappy 2BR apartment was $1700/month thanks to the tight rental market. Mortgage and taxes on a townhouse in a nicer part of town? $1200/month. And theoretically after 30 years I would have an asset I could sell, unlike the renters. Renting just didn't make sense unless you're highly itinerant and don't stick around any one area for more than a year or two.
  - schrodinger 11y ago
    What if you had rented and invested that 500/month (and the maintenance costs you had to pay along the way) in index funds?
    - jandrese 11y ago
      Uh, I was paying $500 more per month to rent than to own. Most people I know around here who bought a house saw their monthly payment go down. Also, it seems a bit odd to hedge against downturns in the housing market by investing in the stock market. The latter is far more volatile.
  - restalis 11y ago
    "Renting a crappy 2BR apartment was $1700/month thanks to the tight rental market. Mortgage and taxes on a townhouse in a nicer part of town? $1200/month." So you take a mortgage and you're happy and there is a chance that you'll stay happy because your present reckoning may remain as good in the future as it is now. But it also may not. By mortgaging you become a sitting duck against the change, and that rental business of $1700/month seems attractive enough to invite further involvement and development thus driving the prices much lower not only compared to its current figure but also with the praised rental figure. What would you do then if this happens? Refinance in order to stretch that mortgage for more than 30 years?

restalis 11y ago

"paying in rent - with the interest on my mortgage the amount of «lost» money comes out to roughly the same amount for now" But there is also the opportunity cost. Having a mortgage may be equivalent financially, but it's a liability when considering your freedom to change or to invest in something profitable that may pop up along the way.