BF2S Forums The Housing War

SEREMAKER wrote:

JohnG@lt wrote:

SEREMAKER wrote:

I'm not one to have someone profit off my residents at an establishment.

If you meant 'residence' (I'm not picking on your spelling), then the town you live in is profiting off of you via taxation, the bank is profiting off of the interest you pay, and you would have to see the price of your house double over the life of the mortgage to see a single penny in profit.

It's better to rent an older home (one where the mortgage payments are low and thus the rent is low as well), invest the difference between the rent and what a mortgage would be, and you'll make far more than you would via simple homeownership in the same time frame.

the debate is way to general, while home ownership vs renting is to specfic to certain areas

while in some areas and if the indiviual is always on the move then renting would be the right idea

and for others ownership is much better .... taxes ( while some states do not do property taxes ) do go to good things like schools in such but the same can be said for a vehicle tax on a vehicle that has been paid off for several years ... and if someone is wise with their mortaguage they can see a 30 year loan turn into a 18 - 20 year loan

Last edited by JohnG@lt (2010-06-25 13:15:13)

Last edited by JohnG@lt (2010-06-25 21:52:01)

JohnG@lt wrote:

SEREMAKER wrote:

short of having diamonds or gold, everything has to be maintained in way or another ..... from yourself to your car to your business to your home

The argument is that home ownership is essentially a trap. Over the course of mortgage you pay for the house twice in interest alone, add maintenance on top of that, property taxes, school taxes, tens of thousands for renovations etc. But the big argument against home ownership is that it limits your future earnings potential. It's nice to have stability but it's a lot easier to pack up and move to a newer, higher paying job, when you don't have to worry about putting your home on the market and selling it.

Unless you own a business that is geographically tied to a certain area, there is really no logical reason to own a home. We've been propagandized to our entire life that "American Dream = Homeownership" and it's really difficult for most people to see past that. For the vast, vast majority of people in this country, renting is the correct choice.

Dilbert_X wrote:

JohnG@lt wrote:

SEREMAKER wrote:

short of having diamonds or gold, everything has to be maintained in way or another ..... from yourself to your car to your business to your home

The argument is that home ownership is essentially a trap. Over the course of mortgage you pay for the house twice in interest alone, add maintenance on top of that, property taxes, school taxes, tens of thousands for renovations etc. But the big argument against home ownership is that it limits your future earnings potential. It's nice to have stability but it's a lot easier to pack up and move to a newer, higher paying job, when you don't have to worry about putting your home on the market and selling it.

Unless you own a business that is geographically tied to a certain area, there is really no logical reason to own a home. We've been propagandized to our entire life that "American Dream = Homeownership" and it's really difficult for most people to see past that. For the vast, vast majority of people in this country, renting is the correct choice.

Thing is, a mortgage does force people to put away money instead of spending it on beer and strippers.
It may give a poor return sometimes but can be better than literally pissing it away.

JohnG@lt wrote:

Dilbert_X wrote:

JohnG@lt wrote:

The argument is that home ownership is essentially a trap. Over the course of mortgage you pay for the house twice in interest alone, add maintenance on top of that, property taxes, school taxes, tens of thousands for renovations etc. But the big argument against home ownership is that it limits your future earnings potential. It's nice to have stability but it's a lot easier to pack up and move to a newer, higher paying job, when you don't have to worry about putting your home on the market and selling it.

Unless you own a business that is geographically tied to a certain area, there is really no logical reason to own a home. We've been propagandized to our entire life that "American Dream = Homeownership" and it's really difficult for most people to see past that. For the vast, vast majority of people in this country, renting is the correct choice.

Thing is, a mortgage does force people to put away money instead of spending it on beer and strippers.
It may give a poor return sometimes but can be better than literally pissing it away.

Well, yeah, the only time it's better to rent is when you plan on investing the difference saved vs a mortgage.

ATG wrote:

Or, at least my view from this front (s)line(\s) yard.

I bought at 415k and now it may get between  174-196k at auction or short sell. The bank told me to miss a few payments to qualify for a modification, which I did, which drove most of my credit cards to 31% even though I was current with them. Now, my credit is shot and the bank says, no modification for you.

So I get a realtor ( who is in exactly the same position ) who monitors the public filings. He says wait until they file the notice, which starts a 90 day clock. He then will start a short sell and we list it. He says that the bank cannot foreclose in a short sell and, we are not required to accept offers and that process can drag on for 1-2 years in this climate. In the mean time he finds so technicality in disclosure and we sue the lender. In cases of fraud the banks can be required to refund down payment and a portion of the payments.

This scenario basicfally allows me to recoup a large portion of our 140k cash investment before we short sell. Apparently investors perfer to rent to the down and out home owners, so we may end up not even moving.

The banks are still covered. Too big to fail.


What a fiasco.


By the way, our friends and family and people I know in business say to do this as I am now screwed and we never took a dime out in equity. The word fraud keeps coming up.

nlsme1 wrote:

JohnG@lt wrote:

Dilbert_X wrote:

Thing is, a mortgage does force people to put away money instead of spending it on beer and strippers.
It may give a poor return sometimes but can be better than literally pissing it away.

Well, yeah, the only time it's better to rent is when you plan on investing the difference saved vs a mortgage.

You do realize, that in almost all instances, rent will be higher than a mortgage.

JohnG@lt wrote:

I just did a simple mortgage calculation using the current 4.72% 30 year mortgage rate that seems to be standard right now.

Using a $400,000 house, if there was no interest on the home, I would pay $1,111.11 a month clear it off the books in 30 years. 400000/360

At the 4.72% interest rate, my monthly payment would be $2,079.36 per month. 2079.36*360=$748,570.46.

So, my home would have to appreciate $348,570.46 over the course of the 30 year mortgage for me to break even on my purchase. This would require an annual inflation rate of 2.9%. Since the Federal Reserve is charged with keeping the inflation rate between 1 and 2%, it should take a whopping 50 years to break even.

Houses are not investments.

13/f/taiwan wrote:

The house that I'm living in now was purchased in 1990 for $250,000. 20 years later, you can put it on the market for $1,000,000 and it will sell within a few weeks. When my Grandfather brought it all he had to do was rent out the 2nd floor and basement as well as add on what he would of paid in rent and that took care of the mortgage each month for 15 years. Now my Grandmother(Grandfather passed away 10 years ago) makes $36,000 from rent each year. After subtracting all her yearly finances she comes out with 10k a year. All her kids are married and moved away so she has an entire floor to herself.