Is renting an inevitable waste of money?

[RockBell]

The correct answer depends on the country you are in. If the city is expensive, like New-York for example, renting is your only solution to live there. For example in my city the amount people pay for 2 bedroom rent + utility bills equals paying out loan for same 2 bedroom flat. Financially having a rent flat isnt profitable, but you will have to stick to one place for 15-20 years if you take a loan, when youth dream is to move to other country, and elder generation does not feel stability in keeping work.

Not only in New York, but the demand for housing has also increased, and housing finance is a significant issue in my region, so there is no way you can avoid renting. Currently, renting an apartment is even harder to obtain, and because of the high demand it has affected the price, owning a house is now so ridiculously expensive, and the majority of NGOs that help with the housing problem are not very functional in my area.

[Sterbens]

Renting has its disadvantages - at any time the fee can be increased, there is no stability (there can always be a need to move out urgently), problems with repairs. so it is necessary to have your own housing in any condition and of any size (at least a room in an apartment). However, renting is not a waste of money - it gives a certain freedom of movement. And it's a basic option if you can't save for your own flat

Yes, that's true, but it comes back to our needs whether we need more rental housing or not. Renting is something that is profitable in certain situations and in other situations it will certainly be different. We have to consider everything including our needs.
For example, we are not reasonable enough when we work outside the city with a contract work status, we have to buy or even pay off a house. Under these circumstances, renting is the best solution. It's different if we really live in that environment and have permanent jobs there.

[og kush420]

The correct answer depends on the country you are in. If the city is expensive, like New-York for example, renting is your only solution to live there. For example in my city the amount people pay for 2 bedroom rent + utility bills equals paying out loan for same 2 bedroom flat. Financially having a rent flat isnt profitable, but you will have to stick to one place for 15-20 years if you take a loan, when youth dream is to move to other country, and elder generation does not feel stability in keeping work.

Not only in New York, but the demand for housing has also increased, and housing finance is a significant issue in my region, so there is no way you can avoid renting. Currently, renting an apartment is even harder to obtain, and because of the high demand it has affected the price, owning a house is now so ridiculously expensive, and the majority of NGOs that help with the housing problem are not very functional in my area.

for some people they would want to pay off rent - and for other some people would rather pay mortgage
Maybe many people just want to go with the flow while the other people do plan for what they have to do in their life.. .

[Ultegra134]

There are so many different situations you need to find the setup that works for you. Some people get lucky with a flat share with friends at a fraction of the market rate, others get trapped with the worst housemates out of necessity yet still pay high amounts due to the local area, some people who buy a house pay stupid interest rates because they do no research while others are running optimum finances that make a mortgage the best option. It can be hard to find the ideal house as a buyer because your budget is often fixed at the limits of what you can afford, many people start off with buying a flat which comes with the possibility of problems you identified as a renter.

My brother is fine with having a few roommates; I, on the other hand, can't stand having more than one, and I'm also picky and a little difficult as a person. I want to have my own space and not have to worry that my actions or preferences may disturb someone. Thus, it's not an ideal solution for myself; I'm getting along just fine with my girlfriend, though there are minor issues. If I were to get a loan for an apartment, I'd choose an older one that required repairs that I'd work on myself in order to save money, and we'd put personal effort and dedication into that house. The feeling that you've created something with your own hands and personal work is exceptionally satisfying.

[og kush420]

There are so many different situations you need to find the setup that works for you. Some people get lucky with a flat share with friends at a fraction of the market rate, others get trapped with the worst housemates out of necessity yet still pay high amounts due to the local area, some people who buy a house pay stupid interest rates because they do no research while others are running optimum finances that make a mortgage the best option. It can be hard to find the ideal house as a buyer because your budget is often fixed at the limits of what you can afford, many people start off with buying a flat which comes with the possibility of problems you identified as a renter.

My brother is fine with having a few roommates; I, on the other hand, can't stand having more than one, and I'm also picky and a little difficult as a person. I want to have my own space and not have to worry that my actions or preferences may disturb someone. Thus, it's not an ideal solution for myself; I'm getting along just fine with my girlfriend, though there are minor issues. If I were to get a loan for an apartment, I'd choose an older one that required repairs that I'd work on myself in order to save money, and we'd put personal effort and dedication into that house. The feeling that you've created something with your own hands and personal work is exceptionally satisfying.

Most of the people are tired of renting and they have made themselves small house-or they have renovated the bus and started living in it.
This is all to get rid of the rent - sometime. you dont have funds to payoff the rent. I think one should have a roof over your head. Not a RENTED roof - but your own roof.

[Davidvictorson]

Whether renting is a waste of money or not depends on on the individual and where they live. Is the cost of living high or low? Do you live in a metropolitan area or in the suburbs? What's are the rules and regulations governing renting or buying your own property. When the individual has been able to answer this question and many more then they will come to the conclusion whether renting is a waste.

[Picaflor]

It depends on the market conditions. If you can put $1m in BTC and rent a place for a year, and the BTC price double in that time and your rent is less than $1m over that period, then renting was a good decision, because the BTC investment turned out better than the potential real estate investment.

Interest rates are important too.

One thing people often miss is when you own, the mortgage payments are not your housing cost, because they consist of principal and interest payments and only the latter component is your cost. Principal repayments add to your equity; you're just moving money from one pocket to another.
E.g. if your monthly mortgage payments are $1000, $700 of which is principal and $300 of which is interest, you're only paying $300 to live. You're unlikely to find a place to rent for that little. The remaining $700, however, is a commitment to move money from one pocket to another, and you have to have it or you'll get in trouble.

Low interest rate environments favor owning your home, but they also lead to property price bubbles, because when it makes more sense to own, more people do it and prices go up. An arbitrage opportunity arises and gets arbed out. So if you bought a year ago, your house may be worth less now that the interest rates are higher.

But then again, when interest rates are high and you're tempted to rent, the higher mortgage costs are passed onto tenants. So it may be a good time to buy, especially if you don't have to commit to the current high rates for long.

All in all, owning is good and it tends to be a safe investment with less volatility than many other investments. If you can afford it, it puts you ahead of many who can't, even if otherwise the conditions favor it. This creates a market inefficiency which you can exploit.

[tiCeR]

Calling renting an inevitable was of money is quite a narrow view of reality I think. I mean what would the world be without the option to rent places? I am not only looking at it from the perspective of going on vacation, but being able to rent a place significantly increases global workforce mobility for instance. If you get to work in a dream job but you are only willing to do it for say 3 to 5 years in a place in a foreign country, buying a house there might not be possible nor feasible financially. Being able to rent a place is the perfect solution. Think about all those shared places as well and how students organize themselves these days in order to reduce individual cost. All of those advantages come with renting. While you do incur a certain kind of opportunity cost due to renting, you open up a different range of options for you at the same time. You can quickly switch places, you can increase your personal lifestyle if that is of more importance to you than owning property at a certain point of your life. The generalization of it being a waste of money goes too far I believe. I know what you are trying to say but there is a reason why option carry true financial value and renting gives you options, hence is not only a cost factor.

[Cryptock]

You are lucky that you can find an apartment within a $400 range. That's cheap when you compare it with other countries. But I don't think "renting" is a waste of money. You are renting it because you have to. It's like saying why not buy a whole farm and produce your own food instead of buying food everyday because it is an inevitable waste of money. Start saving for the down payment as much as you can. Then pay the rest. You will be paying a little more than what you pay for the rent, but in the long run, you will have your own house. You just need to make sure you always have a job. And also remember, not everyone can afford to own their own house.

$400 is a big amount for a developing country like ours.
However with the passage of time I believe one should have a small place - a dream home of one own rather than renting one should spend in on their own home

[bakasabo]

If the life turns its back on me and I be force to rent, I will rent, but in other situations I will try my best to have my own place. I feel more comfortable if I own the place. No matter what agreement or contract you have, place owner can always find a way to kick your out when you rent. I prefer to have small but my own, instead of living in one's trunks.

Would gladly read posts from users that rent for a long period (not exactly one place). What benefits they have. I've already read that some people rent, because it allows them to travel and not to stick to one place. My job forces me to stick to one place. And my city isnt that big (1 million citizens only) to want to try to live in different city places because of its specific areas and needs. In case I need something I have a car or can get there by taxi.

[Iroh]

If the life turns its back on me and I be force to rent, I will rent, but in other situations I will try my best to have my own place. I feel more comfortable if I own the place. No matter what agreement or contract you have, place owner can always find a way to kick your out when you rent. I prefer to have small but my own, instead of living in one's trunks.

Would gladly read posts from users that rent for a long period (not exactly one place). What benefits they have. I've already read that some people rent, because it allows them to travel and not to stick to one place. My job forces me to stick to one place. And my city isnt that big (1 million citizens only) to want to try to live in different city places because of its specific areas and needs. In case I need something I have a car or can get there by taxi.

I quite agree with you as having your own place is more better than renting out a apartment. For one, i too feel comfortable living in my own home with no fear of eviction from anyone.
Obviously, when you’re young and starting out on your own, you might be forced to rent. While people rent cause it helps them to be more flexible and not stuck in one place. I think having your own place doesn’t stop you from being flexible. It’s best having your own home as you could do all the traveling and exploring you want and still have a home to come back to and lay your head. I think nothing beats having your own place.

[Pamadar]

If the life turns its back on me and I be force to rent, I will rent, but in other situations I will try my best to have my own place. I feel more comfortable if I own the place. No matter what agreement or contract you have, place owner can always find a way to kick your out when you rent. I prefer to have small but my own, instead of living in one's trunks.

Would gladly read posts from users that rent for a long period (not exactly one place). What benefits they have. I've already read that some people rent, because it allows them to travel and not to stick to one place. My job forces me to stick to one place. And my city isnt that big (1 million citizens only) to want to try to live in different city places because of its specific areas and needs. In case I need something I have a car or can get there by taxi.

I quite agree with you as having your own place is more better than renting out a apartment. For one, i too feel comfortable living in my own home with no fear of eviction from anyone.
Obviously, when you’re young and starting out on your own, you might be forced to rent. While people rent cause it helps them to be more flexible and not stuck in one place. I think having your own place doesn’t stop you from being flexible. It’s best having your own home as you could do all the traveling and exploring you want and still have a home to come back to and lay your head. I think nothing beats having your own place.

Nothing beats to have your own house as you will not think about the monthly rent, most of us if not all will agree the
convenient that you will get when you own a house.

And like with yur argument, it's good to travel knowing that any time you can simply go back
with a comfort of your own house. Investment wise, you can save your monthly rent and use
it for your own business.

[Greyhats]

You can calculate the answer to your question, it most markets but not all it’s cheaper to rent when you look at the first 5 yrs of house ownership. At 5-15 it starts skewing to ownership and 15+ totally owning.

IMHO the time you expect to stay where you are becomes the more the moot point about whether you should buy or stay renting.

If you’re not buying to live in, but as an investment think of it as a savings account, where other people are basically paying into your savings account. General rule of thumb is make 5+% net annually and do not consider value appreciation, depreciation, tax breaks, saving interest etc in that calculation. Also consider most investors don’t borrow for the first one.

[Cryptock]

You can calculate the answer to your question, it most markets but not all it’s cheaper to rent when you look at the first 5 yrs of house ownership. At 5-15 it starts skewing to ownership and 15+ totally owning.

IMHO the time you expect to stay where you are becomes the more the moot point about whether you should buy or stay renting.

If you’re not buying to live in, but as an investment think of it as a savings account, where other people are basically paying into your savings account. General rule of thumb is make 5+% net annually and do not consider value appreciation, depreciation, tax breaks, saving interest etc in that calculation. Also consider most investors don’t borrow for the first one.

With the passage of time - especially after COVID and this recent earthquake. I am now losing interest in worldly things.
I now believe one should have small house and a good emergency fund and nothing more than that - we all will be dying one day and nothing will be helping us.

[Theones]

You can calculate the answer to your question, it most markets but not all it’s cheaper to rent when you look at the first 5 yrs of house ownership. At 5-15 it starts skewing to ownership and 15+ totally owning.

IMHO the time you expect to stay where you are becomes the more the moot point about whether you should buy or stay renting.

If you’re not buying to live in, but as an investment think of it as a savings account, where other people are basically paying into your savings account. General rule of thumb is make 5+% net annually and do not consider value appreciation, depreciation, tax breaks, saving interest etc in that calculation. Also consider most investors don’t borrow for the first one.

some people are very good in calculations but the plans not always work as we think.
There is a supreme power which is also moving the world and we must keep that in mind. In all we plan - we must seek the will of the GOd . . this is my personal opinion you may disagree.

[dothebeats]

You can calculate the answer to your question, it most markets but not all it’s cheaper to rent when you look at the first 5 yrs of house ownership. At 5-15 it starts skewing to ownership and 15+ totally owning.

IMHO the time you expect to stay where you are becomes the more the moot point about whether you should buy or stay renting.

If you’re not buying to live in, but as an investment think of it as a savings account, where other people are basically paying into your savings account. General rule of thumb is make 5+% net annually and do not consider value appreciation, depreciation, tax breaks, saving interest etc in that calculation. Also consider most investors don’t borrow for the first one.

some people are very good in calculations but the plans not always work as we think.
-snip-

Most plans have rock-solid foundations when they are first created. But, most of these plans do not take into account the possible unforeseen circumstances that can happen along the way. These are the things that foil up a plan that causes its failure. So no matter how great the plan is on paper, if something happens that you're totally unprepared for, your plans will crumble. Similar to investments - if one single bad thing happened to your investments, you'll see your money dwindling away at a very alarming rate. So it's really great to have a stable career before you get that mortgage for a house because you'll never know when you're going to lose it all and really regret paying for a mortgage only for it to be taken away from you just because you can no longer pay for it.

[DrBeer]

1. Any rental of residential real estate (passive rental) is a cost, and REGULAR. You have to be very careful with them. Active rental of real estate is, for example, the rental of a production hall or a warehouse for products - i.e. the rent that provides you with INCOME.
2. It doesn't really matter where you live. The rental price is proportional to the average income in the country/region/city where the residential property is being rented. But there may be nuances. for example, if you decide to rent a luxury apartment in a not very rich country. This is hardly reasonable if you do not have an appropriate regular income to pay for it painlessly.
3. For my part, I will say that until "stabilization of your life", renting an apartment acceptable to your level of income is a reasonable decision, albeit an expense. Let me explain. As long as you do not have a family, children, or your own business, you will most likely look for places for higher-paying jobs, more comfortable living conditions, etc. Therefore, most likely you will be moving from one area of the city to another, or another city, or another region (and possibly to another country). And Buying a property will become a burden. If you have not paid 100% of the property immediately, and you need to leave, you will have the following balance:
(your income) - (mortgage payments) - (payments for renting a new property) - (one-time moving costs) + (rent from your rented apartment). As a rule, mortgage payments are noticeable, and I'm not sure that they will be covered by renting out your property, which will remain in the place where you moved from.

I was lucky, and I did not leave my city. Once I bought my first apartment, then a child appeared - they sold the existing one and bought the next apartment, then they decided to improve living conditions, in a more comfortable place - they bought another apartment, and we rent out the one in which we previously lived. But before buying the first apartment - I rented a house, it was up to 26 years. Rented housing in proportion to my income, so that the rent does not exceed 15-20% of my income

[bakasabo]

If the life turns its back on me and I be force to rent, I will rent, but in other situations I will try my best to have my own place. I feel more comfortable if I own the place. No matter what agreement or contract you have, place owner can always find a way to kick your out when you rent. I prefer to have small but my own, instead of living in one's trunks.

Would gladly read posts from users that rent for a long period (not exactly one place). What benefits they have. I've already read that some people rent, because it allows them to travel and not to stick to one place. My job forces me to stick to one place. And my city isnt that big (1 million citizens only) to want to try to live in different city places because of its specific areas and needs. In case I need something I have a car or can get there by taxi.

I quite agree with you as having your own place is more better than renting out a apartment. For one, i too feel comfortable living in my own home with no fear of eviction from anyone.
Obviously, when you’re young and starting out on your own, you might be forced to rent. While people rent cause it helps them to be more flexible and not stuck in one place. I think having your own place doesn’t stop you from being flexible. It’s best having your own home as you could do all the traveling and exploring you want and still have a home to come back to and lay your head. I think nothing beats having your own place.

I would like to ask people that say they want to be flexible, to travel and live in different places - how many times did they really changed their jobs or moved to different place to live ? Travelling and being flexible is two different things imo. I still travel and it is always nice to return home. Those who prefer to be flexible - where is their home? It more like temporary housing. People in search for themselves.

Perhaps I am old fashioned, but I prefer to stick to one more or less place job, and become a professional, irreplaceable specialist. Then to jump over city or cities, try different job, rent different places.

[Theones]

If the life turns its back on me and I be force to rent, I will rent, but in other situations I will try my best to have my own place. I feel more comfortable if I own the place. No matter what agreement or contract you have, place owner can always find a way to kick your out when you rent. I prefer to have small but my own, instead of living in one's trunks.

Would gladly read posts from users that rent for a long period (not exactly one place). What benefits they have. I've already read that some people rent, because it allows them to travel and not to stick to one place. My job forces me to stick to one place. And my city isnt that big (1 million citizens only) to want to try to live in different city places because of its specific areas and needs. In case I need something I have a car or can get there by taxi.

I quite agree with you as having your own place is more better than renting out a apartment. For one, i too feel comfortable living in my own home with no fear of eviction from anyone.
Obviously, when you’re young and starting out on your own, you might be forced to rent. While people rent cause it helps them to be more flexible and not stuck in one place. I think having your own place doesn’t stop you from being flexible. It’s best having your own home as you could do all the traveling and exploring you want and still have a home to come back to and lay your head. I think nothing beats having your own place.

I would like to ask people that say they want to be flexible, to travel and live in different places - how many times did they really changed their jobs or moved to different place to live ? Travelling and being flexible is two different things imo. I still travel and it is always nice to return home. Those who prefer to be flexible - where is their home? It more like temporary housing. People in search for themselves.

Perhaps I am old fashioned, but I prefer to stick to one more or less place job, and become a professional, irreplaceable specialist. Then to jump over city or cities, try different job, rent different places.

Moving to another place is hard. Be it a new city or the country
And I think the answer to this question varies. I am not in favour of Rent all the time - I would like to have my own place.

[blockman]

Moving to another place is hard. Be it a new city or the country
And I think the answer to this question varies. I am not in favour of Rent all the time - I would like to have my own place.

We all want to have our own place but renting is the solution for those that are moving from time to time. Like those who are digital nomads, they can transfer from one place to another and that's why it's very easy for them to move.
They don't need to think of anything they have to cover as their asset because for them, it's too easy and there's no hassle at all when they're moving from country to country. Adaptation is also interesting because they learn to bear with new culture.