3 ms·

So am I reading this right, that the Economist is suggesting “mortgage bad, rental good”?? Seems I’ve seen something similar referenced quite a lot recently...

So am I reading this right, that the Economist is suggesting “mortgage bad, rental good”?? Seems I’ve seen something similar referenced quite a lot recently... https://www.weforum.org/agenda/2016/11/how-life-could-change-2030/ https://www.weforum.org/agenda/2016/11/how-life-could-change...

DocTomoe 5y ago
Seen from another angle, homeownership (once the mortgage has been paid) grants freedom, while a rent-dweller will remain a slave to his landlord forever, with Damocles's sword named "Eviction and homelessness" always dangling over their heads.
- est31 5y ago
  rent dwellers on the other hand can move whenever they want while home owners are chained to their property. Each time they sell and buy a new property they run a risk of buying lower quality than advertised, selling under value, and they do lose money in fees. Also, home ownership doesn't make you immune from gentrification due to property taxes. Especially if you "only" own a flat in a multi storey building, then you have only little influence in your maintenance fees bills. That being said, personally, I still prefer home ownership over renting.
  - brobdingnagians 5y ago
    Brings up a key point; there are pros and cons to each; and, like most things, there are risks to each. The great thing is being able to look at your own situation and preferences and choose which you think you want. I love economics because it is one big decentralized computation for a future that we don't know. The difficulty is when people start cramming one size fits all on everyone, everyone gets the same result, which is usually worse than people choosing according to their own situation and evaluating pros, cons, and risks. The issue I have with a lot of think tanks is they often have an agenda of forcing one size fits all on everybody because they think they are smarter than the collective decentralized decision making of people with skin in the game.
  - adrianb 5y ago
    > home owners are chained to their property As someone who moved across 4 countries in 10 years, I had the same opinion. Then I noticed that people who moved as often as me had no trouble to move out, rent their mortgaged apartment for more than monthly payments or sell it at a profit.
    - bena 5y ago
      Yeah, I keep hearing about how homeowners are "chained", but I'm on my second house and I've also rented in between houses. One apartment had an 18 month lease and the other an initial 12 month lease, with the option to renew on an 18 month, 12 month, or month by month basis. That means, unless I was willing to incur heavy penalties, I couldn't move until the lease was up. Even now, we're kind of paying a mortgage and rent because there's a couple months of overlap. Whereas, when I sold my house, I called a realtor, said I wanted to sell and it happened when it happened. We closed in March on our current house, I could sell it today if I wanted. I think home-ownership and rental both have their places. And someone mentioned a housing co-op situation. That's new to me. That's likely worth exploring a bit as well.
- Mengkudulangsat 5y ago
  I'm a millennial and I plan to rent forever because I value the ability to move out whenever I liked. Even homeowners can't escape that sword of Damocles you describe. IMO as long as you have assets (stocks, cash, etc.) that you can periodically liquidate to cover expenses, the form of those assets doesn't matter.
  - alert0 5y ago
    The form of those assets absolutely matters. Bonds right now? Bad idea. Cash when we hit the inflation part of the long term debt cycle? Also bad idea.
  - inglor_cz 5y ago
    I am a GenXer and after some time I got tired of obnoxious landlords. Plus, after living in 12 different places and not knowing when the next "please move out, I need this apartment for other purposes" note comes, is sorta stressful. Every coin has two sides. I can imagine that expensive real property may be a burden that prevents you from living fully. I can also imagine having a house as an anchor in a place I love.
    - eertami 5y ago
      >not knowing when the next "please move out, I need this apartment for other purposes" note comes, is sorta stressful. Yeah I've had this happen in the UK, can be inconvenient. The fix is legislation and increased requirements for landlords. I moved to another country where it isn't possible for a landlord to evict a tenant during a tenancy agreement (unless they are withholding rent) and now thankfully I don't need to worry about this at all.
      - em-bee 5y ago
        in some of those countries, repeated time limited contracts are also not legal. once you live somewhere for more than 6 months or a year (or whatever the period is specified by law) then the contract automatically converts into an unlimited contract with monthly payments. to get evicted, you need to withhold paying rent for some time (more than just a few months) or cause severe damage to the property. if the property is the only property being rented out by the landlord, then the landlord could evict you if they need that property for their own children or for themselves. but beyond that, they can't evict you.

DocTomoe 5y ago

Seen from another angle, homeownership (once the mortgage has been paid) grants freedom, while a rent-dweller will remain a slave to his landlord forever, with Damocles's sword named "Eviction and homelessness" always dangling over their heads.

est31 5y ago
rent dwellers on the other hand can move whenever they want while home owners are chained to their property. Each time they sell and buy a new property they run a risk of buying lower quality than advertised, selling under value, and they do lose money in fees. Also, home ownership doesn't make you immune from gentrification due to property taxes. Especially if you "only" own a flat in a multi storey building, then you have only little influence in your maintenance fees bills. That being said, personally, I still prefer home ownership over renting.
- brobdingnagians 5y ago
  Brings up a key point; there are pros and cons to each; and, like most things, there are risks to each. The great thing is being able to look at your own situation and preferences and choose which you think you want. I love economics because it is one big decentralized computation for a future that we don't know. The difficulty is when people start cramming one size fits all on everyone, everyone gets the same result, which is usually worse than people choosing according to their own situation and evaluating pros, cons, and risks. The issue I have with a lot of think tanks is they often have an agenda of forcing one size fits all on everybody because they think they are smarter than the collective decentralized decision making of people with skin in the game.
- adrianb 5y ago
  > home owners are chained to their property As someone who moved across 4 countries in 10 years, I had the same opinion. Then I noticed that people who moved as often as me had no trouble to move out, rent their mortgaged apartment for more than monthly payments or sell it at a profit.
  - bena 5y ago
    Yeah, I keep hearing about how homeowners are "chained", but I'm on my second house and I've also rented in between houses. One apartment had an 18 month lease and the other an initial 12 month lease, with the option to renew on an 18 month, 12 month, or month by month basis. That means, unless I was willing to incur heavy penalties, I couldn't move until the lease was up. Even now, we're kind of paying a mortgage and rent because there's a couple months of overlap. Whereas, when I sold my house, I called a realtor, said I wanted to sell and it happened when it happened. We closed in March on our current house, I could sell it today if I wanted. I think home-ownership and rental both have their places. And someone mentioned a housing co-op situation. That's new to me. That's likely worth exploring a bit as well.
Mengkudulangsat 5y ago
I'm a millennial and I plan to rent forever because I value the ability to move out whenever I liked. Even homeowners can't escape that sword of Damocles you describe. IMO as long as you have assets (stocks, cash, etc.) that you can periodically liquidate to cover expenses, the form of those assets doesn't matter.
- alert0 5y ago
  The form of those assets absolutely matters. Bonds right now? Bad idea. Cash when we hit the inflation part of the long term debt cycle? Also bad idea.
- inglor_cz 5y ago
  I am a GenXer and after some time I got tired of obnoxious landlords. Plus, after living in 12 different places and not knowing when the next "please move out, I need this apartment for other purposes" note comes, is sorta stressful. Every coin has two sides. I can imagine that expensive real property may be a burden that prevents you from living fully. I can also imagine having a house as an anchor in a place I love.
  - eertami 5y ago
    >not knowing when the next "please move out, I need this apartment for other purposes" note comes, is sorta stressful. Yeah I've had this happen in the UK, can be inconvenient. The fix is legislation and increased requirements for landlords. I moved to another country where it isn't possible for a landlord to evict a tenant during a tenancy agreement (unless they are withholding rent) and now thankfully I don't need to worry about this at all.
    - em-bee 5y ago
      in some of those countries, repeated time limited contracts are also not legal. once you live somewhere for more than 6 months or a year (or whatever the period is specified by law) then the contract automatically converts into an unlimited contract with monthly payments. to get evicted, you need to withhold paying rent for some time (more than just a few months) or cause severe damage to the property. if the property is the only property being rented out by the landlord, then the landlord could evict you if they need that property for their own children or for themselves. but beyond that, they can't evict you.