3 ms·

Of course renting is financially the better choice in the long run. But on the other hand you have to deal with a landlord, and this has a cost (aka they might

Of course renting is financially the better choice in the long run. But on the other hand you have to deal with a landlord, and this has a cost (aka they might force you to move out).

davidt84 2y ago
That doesn't really make sense to me. The homes you rent are owned by the landlord and they need to pay the mortgage and make a profit.
- rapfaria 2y ago
  Found the landlord. OP mentions the cost of moving when you get kicked, and perhaps the "anxiety" cost, when you get a message on January 1st, asking if everything is okay, and he is thinking about selling the house...
  - davidt84 2y ago
    Eh? I'm saying renting is going to be more expensive (and less secure, as you say), I'm not a landlord...
  - Sohcahtoa82 2y ago
    > Found the landlord. I think you misinterpreted that comment. "They need to pay their mortgage and make a profit" is meant to by a cynical take on landlords.
- whatever1 2y ago
  Landlords many times have other objectives rather than being cash flow positive. One might want to speculate on the future price of the property. So instead of having empty the property they just rent it. This is obvious in the west coast where rent is so much cheaper than monthly payment of a 30yr mortgage. Other landlords use property to just launder money. So any income is useful.
vasco 2y ago
There's a something to be said about owning the place you live at, not asking anyone questions about anything. I've rented all my adult life and while it's been OK, it's definitely not the same. Most sovereign states also give lots of advantages and protections to someone's primary owned home in terms of tax or historically in terms of reparations. If you had money somewhere or gold or whatever after WW2 you probably lost everything, but if your house was razed to the ground in say Warsaw, chances are if you could prove even in a flimsy way (most people lost their paper deeds) you owned it, you got it back later. There's a powerful thing about owning a piece of land that other financial instruments don't have.
Sohcahtoa82 2y ago
If your conclusion is that renting is better in the long run, then I'd argue that your run isn't long enough. The article only used an 8 year home ownership period. If you move every 8 years, then yeah, maybe renting is better because paying closing costs of a mortgage every 8 years adds up, not to mention for the first couple years of a mortgage, 60-70% of the payments are just going to interest. But if you're going to live in a house for 15+ years, I can't possibly see how renting works out. Even if you invest what you save by renting, rents rise, and eventually the rent will exceed what your fixed mortgage payment would have been had you originally bought, and that money you invested starts to vanish.
kleiba 2y ago
Why "of course"? And what exactly "dealing with a landlord" means is strongly dependent on the legislation you live in. For instance, when I lived in Germany, I learned that tenants have extremely strong rights (compared to the US) which perhaps partly explains why most people over there rent. (Another explanation is that many people cannot afford to pay for a mortgage...)

Of course renting is financially the better choice in the long run. But on the other hand you have to deal with a landlord, and this has a cost (aka they might force you to move out).

davidt84 2y ago

That doesn't really make sense to me. The homes you rent are owned by the landlord and they need to pay the mortgage and make a profit.

rapfaria 2y ago
Found the landlord. OP mentions the cost of moving when you get kicked, and perhaps the "anxiety" cost, when you get a message on January 1st, asking if everything is okay, and he is thinking about selling the house...
- davidt84 2y ago
  Eh? I'm saying renting is going to be more expensive (and less secure, as you say), I'm not a landlord...
- Sohcahtoa82 2y ago
  > Found the landlord. I think you misinterpreted that comment. "They need to pay their mortgage and make a profit" is meant to by a cynical take on landlords.
whatever1 2y ago
Landlords many times have other objectives rather than being cash flow positive. One might want to speculate on the future price of the property. So instead of having empty the property they just rent it. This is obvious in the west coast where rent is so much cheaper than monthly payment of a 30yr mortgage. Other landlords use property to just launder money. So any income is useful.

vasco 2y ago

There's a something to be said about owning the place you live at, not asking anyone questions about anything. I've rented all my adult life and while it's been OK, it's definitely not the same. Most sovereign states also give lots of advantages and protections to someone's primary owned home in terms of tax or historically in terms of reparations. If you had money somewhere or gold or whatever after WW2 you probably lost everything, but if your house was razed to the ground in say Warsaw, chances are if you could prove even in a flimsy way (most people lost their paper deeds) you owned it, you got it back later. There's a powerful thing about owning a piece of land that other financial instruments don't have.

Sohcahtoa82 2y ago

If your conclusion is that renting is better in the long run, then I'd argue that your run isn't long enough. The article only used an 8 year home ownership period. If you move every 8 years, then yeah, maybe renting is better because paying closing costs of a mortgage every 8 years adds up, not to mention for the first couple years of a mortgage, 60-70% of the payments are just going to interest. But if you're going to live in a house for 15+ years, I can't possibly see how renting works out. Even if you invest what you save by renting, rents rise, and eventually the rent will exceed what your fixed mortgage payment would have been had you originally bought, and that money you invested starts to vanish.

kleiba 2y ago

Why "of course"? And what exactly "dealing with a landlord" means is strongly dependent on the legislation you live in. For instance, when I lived in Germany, I learned that tenants have extremely strong rights (compared to the US) which perhaps partly explains why most people over there rent. (Another explanation is that many people cannot afford to pay for a mortgage...)