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You are throwing money away. If not in the principle building (mortgage payments are commonly less than rent and 20+% goes to principle year 1 - assuming 0 pri

You are throwing money away. If not in the principle building (mortgage payments are commonly less than rent and 20+% goes to principle year 1 - assuming 0 price increase over your term). But also in the US + state tax code and credits - first with "homestead exemptions" - but especially if you make over $100k (yes, roughly 2x median household income, but applies broadly to hacker news and it's a home worth the "average"city price as you get to deduct the property tax and the mortgage interest (so rough savings of 25% on the remaining 80% year 1). For icing on top, you also get credits on energy efficient upgrades.

leetcrew 4y ago
sure, if you're going to live in a 3BR+ home either way, it doesn't take long to break even on a purchase in most markets. but I'm living in a 1BR apartment that comes with a garage parking spot, an ideal setup for me personally. a mortgage for an entry level home in the same neighborhood is comparable to my rent, but it would be a strict downgrade to my QOL, as I don't actually benefit from the extra sqft and would have to put in more work to maintain it. obviously a house with a garage would be much more expensive. I've looked at 1BR condos, but the condo fee generally means it takes much longer to break even vs renting a similar property.
- smileysteve 4y ago
  Pricing is different in different markets. In Atlanta, I was renting in a 1br condo for 7 years; when rent went up 15% in one year, it was free (after principal subtraction) for me to buy/move to a 2br in the same building in 2017. (Even more advantageous as a friend moved in). By 2019 comparable rents for a 2br were 2x my total payments.
lazide 4y ago
My current rent is half (literally) what I’d pay in mortgage and property taxes if I’d bought the same place at the same time. That was when rates were low. It’s even crazier now, with the interest rate spikes. Even at the maximum rate it’s allowed to go up, it would take 5 years for that to change. But that isn’t happening, because California prices dropped 30% yoy already, and it isn’t stopping there anytime soon. Conservatively, my landlord has been ‘paying’ me $4500/mo due to the difference. She inherited it, and refinanced with low rates, so she’s fine at least. A lot of folks I know are staring at bankruptcy right now. Landlords haven’t had positive cash flow on a property in California in at least 5 years (based on ‘purchase now’ numbers). What you are talking about is the ‘sane market’ behavior, but that hasn’t happened anywhere in the country (near as I can tell, from real estate investor friends) for years. Hold onto your butts.

leetcrew 4y ago

sure, if you're going to live in a 3BR+ home either way, it doesn't take long to break even on a purchase in most markets. but I'm living in a 1BR apartment that comes with a garage parking spot, an ideal setup for me personally. a mortgage for an entry level home in the same neighborhood is comparable to my rent, but it would be a strict downgrade to my QOL, as I don't actually benefit from the extra sqft and would have to put in more work to maintain it. obviously a house with a garage would be much more expensive. I've looked at 1BR condos, but the condo fee generally means it takes much longer to break even vs renting a similar property.

smileysteve 4y ago
Pricing is different in different markets. In Atlanta, I was renting in a 1br condo for 7 years; when rent went up 15% in one year, it was free (after principal subtraction) for me to buy/move to a 2br in the same building in 2017. (Even more advantageous as a friend moved in). By 2019 comparable rents for a 2br were 2x my total payments.

lazide 4y ago

My current rent is half (literally) what I’d pay in mortgage and property taxes if I’d bought the same place at the same time. That was when rates were low. It’s even crazier now, with the interest rate spikes. Even at the maximum rate it’s allowed to go up, it would take 5 years for that to change. But that isn’t happening, because California prices dropped 30% yoy already, and it isn’t stopping there anytime soon. Conservatively, my landlord has been ‘paying’ me $4500/mo due to the difference. She inherited it, and refinanced with low rates, so she’s fine at least. A lot of folks I know are staring at bankruptcy right now. Landlords haven’t had positive cash flow on a property in California in at least 5 years (based on ‘purchase now’ numbers). What you are talking about is the ‘sane market’ behavior, but that hasn’t happened anywhere in the country (near as I can tell, from real estate investor friends) for years. Hold onto your butts.