Debt free and $ in the bank

[Crypt0Keeper]

Go to college, get married, buy a home, have kids.  That's what the government wants you to do.  It's not the American Dream, it's the banker's dream.  Those four steps right there all but guarantee that you will be a tax and interest cow for the ruling elite your entire life.

Get off the financial carousel and stay off.  That is why each and every one of us found Bitcoin.

[Sydboy]

took the  words out of my mouth
what you said = thread over.

There is no bigger waste for an average individual than renting, not sure where the "stress free" is coming from, you still have to produce basically the equivalent of an interest repayment every month.

I suggest you re-purchase (unless real estate is having a bad year where you live).

[Gumbork]

Why didn't you just sell the house and purchase a cheaper property you can actually afford?

My rent is $440 a month, PLEASE PLEASE do show me a mortage where my interest rates are less than that.. any house near me is +200k....
The house when I bought it was 179...  Me and a freind bought it with the plan to fix it up and sell it in 5 years, we stuck to the plan added a 2nd bath.  Sold for 245.

Now I rent at $440 a month.. even with a mortage of $800 + $220 a month property tax that's $1020.   That $220 is a total waste.  So $220 vs 800....  now if I save $680 every month instead of paying it into a house over 20 years that's $163,200.00

Now to actually take out a loan of $163,200.00 would cost me $1,103.00 a month for 20 years.


It would literally cost me double to own a house.

This also does not include realstate fees, lawyer fees, land transfer tax...

Sounds like it is better to actually rent based on what you wrote. $440 per month a really cheap if the property value itself is 200k. Now use the money wisely to generate more money (even cd is good enough, just don't burn it).

[CoinsCoinsEverywhere]

Go to college, get married, buy a home, have kids.  That's what the government wants you to do.  It's not the American Dream, it's the banker's dream.  Those four steps right there all but guarantee that you will be a tax and interest cow for the ruling elite your entire life.

Get off the financial carousel and stay off.  That is why each and every one of us found Bitcoin.

A lot of people seem to enjoy those four things, or at least 2 or 3 of them.  So I'm curious--what's your dream if it doesn't include any of those?

Edit: How do you believe these things help the government?  Yes, you pay more taxes if you make more money, spend it on a house and kids, etc.  But you also get significant tax breaks that offset at least some of that.

[CoinsCoinsEverywhere]

Why didn't you just sell the house and purchase a cheaper property you can actually afford?

My rent is $440 a month, PLEASE PLEASE do show me a mortage where my interest rates are less than that.. any house near me is +200k....
The house when I bought it was 179...  Me and a freind bought it with the plan to fix it up and sell it in 5 years, we stuck to the plan added a 2nd bath.  Sold for 245.

Now I rent at $440 a month.. even with a mortage of $800 + $220 a month property tax that's $1020.   That $220 is a total waste.  So $220 vs 800....  now if I save $680 every month instead of paying it into a house over 20 years that's $163,200.00

Now to actually take out a loan of $163,200.00 would cost me $1,103.00 a month for 20 years.


It would literally cost me double to own a house.

This also does not include realstate fees, lawyer fees, land transfer tax...

Sounds like it is better to actually rent based on what you wrote. $440 per month a really cheap if the property value itself is 200k. Now use the money wisely to generate more money (even cd is good enough, just don't burn it).

Actually, this brings up an important question.  Is the property that you're renting worth 200k?  Or are you renting something much cheaper/smaller?  I have a hard time believing that you could rent a 200k house/condo/apartment for 440 a month.  The landlord would never make a profit.  It would take almost 38 years just to collect enough rent to equal 200k, not to mention that they have to pay property taxes, insurance, etc.

[superresistant]

Why didn't you just sell the house and purchase a cheaper property you can actually afford?

My rent is $440 a month, PLEASE PLEASE do show me a mortage where my interest rates are less than that.. any house near me is +200k.... The house when I bought it was 179...  Me and a freind bought it with the plan to fix it up and sell it in 5 years, we stuck to the plan added a 2nd bath.  Sold for 245. Now I rent at $440 a month.. even with a mortage of $800 + $220 a month property tax that's $1020.   That $220 is a total waste.  So $220 vs 800....  now if I save $680 every month instead of paying it into a house over 20 years that's $163,200.00 Now to actually take out a loan of $163,200.00 would cost me $1,103.00 a month for 20 years. It would literally cost me double to own a house. This also does not include realstate fees, lawyer fees, land transfer tax...

Very well said !! 99% of people are not able to do these simple maths.

I was doing a little more thinking about this, and I realized that you didn't factor inflation into your rent calculations.  You may only be paying $440 a month in rent now, but at 3% inflation, you'll be paying close to $800/month 20 years from now.  With these numbers, it's true that over 20 years your rent will always be lower than a mortgage.  But after that time, you'll also have equity in the house, whereas with renting of course you'll have nothing.  And when looking at that equity, don't forget that that will also be affected by inflation.  So that $165k house that you could have bought now would also have almost doubled in value (again assuming the same 3% inflation rate).  And finally, don't forget about what happens after 20 years.  If you stay in that house, you now pay nothing except property taxes, which should be a lot less than rent, which would continue to increase.  So in the long run, owning still has a good shot at beating renting, but it obviously depends on your particular situation. All of that said, of course, the math is very different if you buy during a bubble. Edit: Even once you own your home, you'd still be paying homeowners insurance in addition to property taxes...forgot about that.

Yes you will pay property tax + insurance that also increase every year.
Then it's a gamble : you have no guarantee that the bubble (housing market) will continue to grow at that rate in the next 20 years.
20 years ! Come on, with all the events that are happening right now, how can someone make a plan for the next 20 years ??
Any shit can happen, any time.

This old thinking of taking a 20 years mortgage for owning your house is obsolete. We do not live in the same world as our parents and grandparents. The world has changed, rules as changed and the speed of changes is increasing exponentially.

The are 2 kinds of people : dead and alive. We all die but the ones who adapt the changes of time tend to live much longer and better.

[Sydboy]

Things must be different in Australia, where I am.
Housing prices just go up and up and up.
inner city continues to sky rocket.

it is bit of a silly attitude to not be interested in property in case it does not go up in value.
certain areas will always go up as they are wanted be many people. if you can get a house in a good area pretty cheap why wouldn't you take it ? you might as well not buy bitcoins, for investmeny purposes as that has a much much greater chance of crashing than the house market, atleast here.

[spazzdla]

Soo did some gandering into Canadain housing vs Canadain Income...

95.. Avg House price:  140k,  income: 35k

Now.. Avg house price: 410k,  Income: 48k..

..

House price:    (410-140)/140 = 192% INCEASE...
Income:  (48-35_/35 - 37% increase...

[ScryptAsic]

Soo did some gandering into Canadain housing vs Canadain Income...

95.. Avg House price:  140k,  income: 35k

Now.. Avg house price: 410k,  Income: 48k..

..

House price:    (410-140)/140 = 192% INCEASE...
Income:  (48-35_/35 - 37% increase...

Sounds like a property bubble is coming..

[spazzdla]

Soo did some gandering into Canadain housing vs Canadain Income...

95.. Avg House price:  140k,  income: 35k

Now.. Avg house price: 410k,  Income: 48k..

..

House price:    (410-140)/140 = 192% INCEASE...
Income:  (48-35_/35 - 37% increase...

Sounds like a property bubble is coming..

The fact that no Canadian I talk to can even consider it's possible... Makes me consider it..  Everyone I talk to views a house as an investment and not a place to live....  This is a huge problem IMO and is a very bad train of thinking.. A house is a place to live not a peice of gold.

[minerpumpkin]

If you actually believe we're (/respectively your country's economy is) in another housing bubble, it may be wise to sell now and wait for prices to go down in order to buy something cheaper or don't lose a lot of money in the process. If you don't believe in a bubble, I don't quite see how houses can be that bad of an investment (unless located in a crappy neighborhood or needing to be fixed big time)

[CoinsCoinsEverywhere]

Why didn't you just sell the house and purchase a cheaper property you can actually afford?

My rent is $440 a month, PLEASE PLEASE do show me a mortage where my interest rates are less than that.. any house near me is +200k.... The house when I bought it was 179...  Me and a freind bought it with the plan to fix it up and sell it in 5 years, we stuck to the plan added a 2nd bath.  Sold for 245. Now I rent at $440 a month.. even with a mortage of $800 + $220 a month property tax that's $1020.   That $220 is a total waste.  So $220 vs 800....  now if I save $680 every month instead of paying it into a house over 20 years that's $163,200.00 Now to actually take out a loan of $163,200.00 would cost me $1,103.00 a month for 20 years. It would literally cost me double to own a house. This also does not include realstate fees, lawyer fees, land transfer tax...

Very well said !! 99% of people are not able to do these simple maths.

I was doing a little more thinking about this, and I realized that you didn't factor inflation into your rent calculations.  You may only be paying $440 a month in rent now, but at 3% inflation, you'll be paying close to $800/month 20 years from now.  With these numbers, it's true that over 20 years your rent will always be lower than a mortgage.  But after that time, you'll also have equity in the house, whereas with renting of course you'll have nothing.  And when looking at that equity, don't forget that that will also be affected by inflation.  So that $165k house that you could have bought now would also have almost doubled in value (again assuming the same 3% inflation rate).  And finally, don't forget about what happens after 20 years.  If you stay in that house, you now pay nothing except property taxes, which should be a lot less than rent, which would continue to increase.  So in the long run, owning still has a good shot at beating renting, but it obviously depends on your particular situation. All of that said, of course, the math is very different if you buy during a bubble. Edit: Even once you own your home, you'd still be paying homeowners insurance in addition to property taxes...forgot about that.

Yes you will pay property tax + insurance that also increase every year.
Then it's a gamble : you have no guarantee that the bubble (housing market) will continue to grow at that rate in the next 20 years.
20 years ! Come on, with all the events that are happening right now, how can someone make a plan for the next 20 years ??
Any shit can happen, any time.

This old thinking of taking a 20 years mortgage for owning your house is obsolete. We do not live in the same world as our parents and grandparents. The world has changed, rules as changed and the speed of changes is increasing exponentially.

The are 2 kinds of people : dead and alive. We all die but the ones who adapt the changes of time tend to live much longer and better.

Yes, property tax and insurance increase, too, but prop tax + ins is a lot less than the rent I would pay on the same size house.  So both will grow, but rent will grow more in absolute terms.

I don't think there's any single solution that works best for everyone.  If you're single and move fairly often, then renting makes a lot of sense.  If you have kids and intend to stay in the same area for a long period of time, then owning makes more sense.

And as I said, the state of the housing market certainly matters.  It will be much harder for an investment in a house to pay off if you buy at the top of a bubble period.  But as long as your timing isn't too bad, I think you will end up with more wealth in the end if you own rather than rent.  Look at it this way: if you own, you pay mortgage, interest, property tax, insurance, and maintenance.  If you rent, unless the owner paid for the property with cash, you're basically paying all of those things plus profit; you're just paying them all through your landlord.  And when renting, after 20 or 30 years, your landlord still owns the property, not you.

[superresistant]

 
Bubbles are bursting regularly.

http://en.wikipedia.org/wiki/Spanish_property_bubble

It is always the same story : It's all good until the day it burst.

I would totally consult experts and do deep research before investing in housing market.

[spazzdla]

Bubbles are bursting regularly.

http://en.wikipedia.org/wiki/Spanish_property_bubble

It is always the same story : It's all good until the day it burst.

I would totally consult experts and do deep research before investing in housing market.

I'm convinced Canada has a housing Bubble..  Not 100% for in my area though, well I would say it depends on the location some really ghetto spots in my city and some widly over priced ones too.