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"Be free of debt, either from student loans or mortgage" ... if the price of your mortgage is the same as renting, why is your statement true? If you run out of
by guiomie 9y ago
"Be free of debt, either from student loans or mortgage" ... if the price of your mortgage is the same as renting, why is your statement true? If you run out of money, mortgage or rent, you've got a problem.
- vkou 9y agoWhen you run out of rent money, your landlord kicks you out, and you move in with your parents, or couch-surf until you get your shit in order, or become homeless. The net hit to your finances is maybe a thousand dollars, or however much a moving truck or a plane ticket costs. When you run out of mortgage money, your home is seized and sold, you will piss away tens of thousands of dollars of equity in foreclosure, realtor, and legal fees. Hundreds of thousands of dollars if you're in a down market, and you go underwater. You'll get to enjoy a ruined credit score... And, on top of that, all the other problems that you face when you can't pay rent. I'd much rather be locked into a $1000/month rent for 30 years, then a $1000/month interest-mortgage for 30 years.
- krashidov 9y agoYou can rent out the home/condo you own
- vkou 9y agoWhich carries other costs. The average tenant is a decent person, but a bad tenant will be a complete nightmare to deal with.
- laythea 9y agoAnother reason is that the housing market is grossly inflated (UK). I would get a better house to rent for £1000/month rent than a house for £1000/month interest-mortgage, in addition to the professional "flexibility" off not having the mortgage "to loose". I am a contractor, so I move around with the work, and certainly earn more income doing so also. The long term, is that I make it big, and then outright buy a house. All or nothing! And in the meantime, I pick up the phone when the house needs maintenance :)
- fyfy18 9y agoIt's also worth taking into account the level of finish. As a landlord it’s almost always not worth spending more for good quality items, as they usually won’t increase your returns. It’s more important how the property looks, than the quality, which I’d say is why IKEA is so popular nowadays. If you want an induction hob, a good mattress, proper ventilation system so the windows don’t have condensation and something other than paper thin walls, you are pretty much out of luck in the UK. On the other hand if you are fitting out your own place, upgrading to better quality items like this doesn’t really cost that much more (e.g. £200 for an induction hob vs £100 for a ceramic hob).
- laythea 9y agoI would add that all sorts of houses are available for rent. I am not talking about student housing etc.
- nojvek 9y agoErrrrr ... you can always sell your house. In the last 5 years prices have almost doubled in many Livable cities. Suppose you bought a house for $300k, paid down $100k of it and sold for $600k. You’d be walking away with a decent amount of cash. In rental when you get kicked out, you get nothing. Renting is paying someone else’s mortgage. If you know you’re gonna stay in one place for a long time, and the market is stable or booming, buying always makes sense.