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It depends on the rent price vs price to own. If renting is much cheaper, which it is in Vancouver unlike SF, then you are wrong. If the rent prices are equiv

It depends on the rent price vs price to own. If renting is much cheaper, which it is in Vancouver unlike SF, then you are wrong. If the rent prices are equivalent to buying, like they are in the Bay Area, then you would be correct.

gmarx 11y ago
Renting and buying prices are equivalent in the Bay area? Not in Palo Alto or the few surrounding cities.
- pfarnsworth 11y ago
  10 years ago or more, the rent prices were much lower than the price to buy a place so it made sense. Now, it doesn't matter which you do, either buy or rent. They are both wrong, because both are sky-high.
  - illicium 11y ago
    When the Bay Area housing bubble collapses in the future, renting will get cheaper, and your mortgage will stay the same.
rconti 11y ago
No it doesn't. If you're renting, you're financing someone else's ownership of the property. It doesn't matter if they own it outright, or if you're only paying 1/10th of their mortgage. It only matters in degrees.
- gozur88 11y ago
  >No it doesn't. If you're renting, you're financing someone else's ownership of the property. That's only true if your rent covers their payment, which tends to not be true in a bubble. Where I am, in the years leading up to 2008 there were more rentals available than the market could really support. People were buying houses and getting rents that only covered part of the payment because they were counting on capital appreciation to make them money. If you were a renter it was a great deal. For $1600 you could rent a house that would sell for $700k, which isn't even close to covering the payment. After the bubble popped the price of housing went down dramatically, and the price of rentals went up dramatically as people stopped buying houses assuming they would appreciate forever. Also, people who've never owned a house drastically underestimate the costs associated with owning one. I bought my house after the crash, for cash. My housing outlay (with no mortgage) is about 75% of what I paid in rent. And that's not counting maintenance, like painting and appliance repair, or major stuff like a new roof. If the bubble had never popped I would have come out far ahead just staying in the apartment and investing the savings.

gmarx 11y ago

Renting and buying prices are equivalent in the Bay area? Not in Palo Alto or the few surrounding cities.

pfarnsworth 11y ago
10 years ago or more, the rent prices were much lower than the price to buy a place so it made sense. Now, it doesn't matter which you do, either buy or rent. They are both wrong, because both are sky-high.
- illicium 11y ago
  When the Bay Area housing bubble collapses in the future, renting will get cheaper, and your mortgage will stay the same.

rconti 11y ago

No it doesn't. If you're renting, you're financing someone else's ownership of the property. It doesn't matter if they own it outright, or if you're only paying 1/10th of their mortgage. It only matters in degrees.

gozur88 11y ago
>No it doesn't. If you're renting, you're financing someone else's ownership of the property. That's only true if your rent covers their payment, which tends to not be true in a bubble. Where I am, in the years leading up to 2008 there were more rentals available than the market could really support. People were buying houses and getting rents that only covered part of the payment because they were counting on capital appreciation to make them money. If you were a renter it was a great deal. For $1600 you could rent a house that would sell for $700k, which isn't even close to covering the payment. After the bubble popped the price of housing went down dramatically, and the price of rentals went up dramatically as people stopped buying houses assuming they would appreciate forever. Also, people who've never owned a house drastically underestimate the costs associated with owning one. I bought my house after the crash, for cash. My housing outlay (with no mortgage) is about 75% of what I paid in rent. And that's not counting maintenance, like painting and appliance repair, or major stuff like a new roof. If the bubble had never popped I would have come out far ahead just staying in the apartment and investing the savings.