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titanic1

Is renting a waste of money?

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You Don't Want to Worry About Maintenance

One benefit of renting is the lack of responsibility when it comes to maintenance or repair. If the roof needs replacing, you are not responsible for covering these costs. If your water heater breaks down, your landlord must repair it within 24 hours. When it comes to major repairs, or any repair that affects your level of comfort, you may be able to deduct the number of days it took your landlord to repair it off of your rent.

You Want to Pay Less for Utilities

Units that share a wall or walls are better at retaining heat, which means your gas or electric bill will be less than in a stand-alone house. Many rental buildings also cover a portion of your utilities (often the cost of water), a savings you can pocket instead.

You Want Mobility

Though you may be locked into a 6-month or 12-month lease, if an opportunity to move presented itself, it is much easier to move from a rental house or apartment than it would be to sell or rent a home you own. Mobility also means that if your finances changed, you can move to reduce your expenses, especially considering that housing consumes an average of 34% of a person's income.

 

One way to gauge if renting is a better financial option is to take your monthly rent and multiply it by 240 (this formula comes from Michael Bluejay's website). If you can purchase a home for that amount, then buying a house will be a better option. However, if you aren't able to purchase a house for that amount, then renting is more financially sound. Of course the key to making renting a better alternative is to invest the difference!


Read more... http://www.wisebread.com/when-you-should-and-shouldnt-rent

There’s a lot of hype about why you need to own a house. But buying a house isn’t the key to financial security for everyone – and those alleged tax advantages? Also not quite what they’re painted to be. I hope to never own a house again. Here’s a list of eleven reasons – many of them tax-related – why:

As investments go, it’s not always a great deal. While it’s true that some homes do appreciate, so do many other assets. If you bought a house for, say, $200,000 thirty years ago, it would be worth $468,375.09 today. While that gain feels impressive, that appreciation is based solely on inflation – which means that, in theory, the same appreciation would have happened with any asset. While we did “make” money on the sale of our house, I suspect we would have had a similar increase had we invested that money in the market or in our business.

The mortgage interest deduction doesn’t make up for the fact that you’re still paying a lot of interest. While I understand that it’s possible to buy a house without a mortgage, the large percentage of homeowners (more than 70%) take out a loan. With average mortgage rates at 4.3% (as of this morning), you’ll actually pay $356,307.44 for a $200,000 home: $156,307.44 in interest alone. Averaged over 30 years, that works out to a little over $5,000 per year (even though in practice you pay the most interest at the beginning). Assuming you’re in a 25% bracket – and you itemize – that works out to a tax savings of just over $1,300 per year. But the word “savings” is somewhat of a misnomer because you’re still out of pocket more than you get back in tax savings: in our example, you would “save” less than $40,000 while paying out more than $150,000 in interest.

How-to-know-if-a-rental-property-is-a-go

Homes often tempt people borrow more than they can afford. As Congress tosses around the idea of taking away the home mortgage interest deduction, homeowners are screaming that they won’t be able to afford their homes without it. In fact, when you’re looking to buy, most lenders and realtors will use the deduction as a selling point to boost prices. But is that a great strategy? When buying a new dress or a new car, consumers tend to focus on the cost of the item alone when determining how much to spend. But when it comes to mortgages, that number edges up because of the potential for tax savings (again, see #2). With that temptation, combined with a sluggish economy, it’s no wonder that more than 10 million homeowners are currently underwater on mortgages worth more than actual house values. We were fortunately not one of them but not for lack of the banks trying. When we bought our home, we were actually approved for a mortgage which was hundreds of thousands of dollars more than the home we ultimately bought. We opted for a less expensive home – and thankfully so.

Read more... http://www.forbes.com/sites/kellyphillipserb/2013/09/27/11-reasons-why-i-never-want-to-own-a-house-again/#10555eb858dd

Edited by titanic1

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I bought a couple of houses in my life, did not stay in them very long so really a waste of money.  Especially when we live in a world where a realtor lists your house for 7% commission.  I appreciate the ability to move if I don't like where I am anymore without having to wait months for my house to sell.  I am in a house again now but I'm getting older so maybe I will stay here for awhile.

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Here are some of the cons regarding renting.

If you have a slum landlord good luck getting anything repaired when things break.

They can raise your rent every year.

They do not have to renew your lease.

If the landlord does not pay the mortgage even though you pay your rent...the bank will put you out on the street.

You are limited as to what you can do in a rental property ie, paint, hang things on the walls, etc.

If you share common walls in a condo or apartment with someone who is an ass, the constant noise can make you crazy.

 

 

 

 

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Well if you're renting you don't have to pay for plumbing, electrical and other repairs. 

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There are very few things you actually own, and a house is one of them. Constant maintenance and repair, you could say the house owns you. The only thing worse than a house when it comes to upkeep, in my experience, is a boat. Then there is the issue of imminent domain,  where I can lose my property even if I don't want to sell. So yes, I can see the point if I were starting over again. It's too late for me,  I  only have 7 years left on my mortgage. At least we had a substantial enough down payment that we didn't take a bath in the interest. 

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6 hours ago, octopus prime said:

There are very few things you actually own, and a house is one of them. Constant maintenance and repair, you could say the house owns you. The only thing worse than a house when it comes to upkeep, in my experience, is a boat. Then there is the issue of imminent domain,  where I can lose my property even if I don't want to sell. So yes, I can see the point if I were starting over again. It's too late for me,  I  only have 7 years left on my mortgage. At least we had a substantial enough down payment that we didn't take a bath in the interest. 

Im on both sides of that fence. I own rental house in Florida and a home in Texas. I want to sell both houses, buy a piece of land, (cash) build a house on that land (cash)...give the gov 10 years of property taxes in advance to they leave me alone. (hopefully) If that plan works, that will take me into my 70's and at that point my kids can sell everything, put me in an old folks home and I can play bingo with the rest of the smelly senile people until I die. :lol_alpha:

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I didn't watch the video, but did it talk about the fat sack of cash you get when you sell your home?

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