$850/month rent; includes garage, all utilities. Why move ?

850$ a month will get you a loaded 2500 sq ft house where I live.

CoL is minimal here.

You could take out a loan, spend 15K on a house that needs a little work, and rent it out for 5x what the loan payment rate would be.

 

As long as it works for you it's all good.

 

the rich are changing directions to an ownership economy, when they raise interest rates renters lose.

when they lower interest rates owners lose.

it is a very difficult concept to understand for most unfortunately, but only then will you be able to participate fruitfully in their game of blood, sweat, and tears.

 

if they are caught on the losing end of the interests of the rich, they create enemys to vent their anger at.

for example debt is often blamed on people who find usury moral, but the rich generally do well in both times of low or high interest rates.

 

Depending on how expensive the area is, $850 may make sense for people to rent. However, make sure you invest money on the side so that you will be able to afford housing if, like Brewster said, rents head higher in the future.

Your return on investment should cover possible future increase in rent levels, forecasted 20 years out into the future. For many people a house turns out to be a beneficial investment because it forces them to save. (Many people aren't that good about handling investments if their assets are in the form of money in a bank account that can be easily spent)

 

Naah. Best thing I ever did was sell my house. I am in a nice apartment (with a full garage) for not much more than I was paying just in property taxes, and I no longer have the unpaid part-time job that is maintaining a house.

 

The payment would be more like $1200-1300 with taxes and insurance. Being able to do your own maintenance will help. The plus side of ownership is deducting your taxes and interest and the appreciation of your home.

I paid $155k 15 years ago. I refinanced for 15 years at 2.75% 9 years ago. In 6 years, my house will be paid off and it is already worth $250k. Payment is currently $1400/month. Another $400/ month for utilities. I live on a fenced 1 acre 4/2/2. It's a great place to raise a family.

If I were single, I would already own a house on acreage and live very comfortably, and lonely most likely. I'm 50 and married with 3 kids. One left in high school.

 

How long do you expect the rent to stay at that level? The main advantage to ownership is that your cost stays relatively constant. The main disadvantage is that it's more responsiblity. If you ever plan to marry (and aren't married now), don't buy a house. Newly weds are likely to move.

 

Buying a house is an investment, renting an apartment not so much.

 

The problem with renting is that $850 a month you are just flushing down the toilet. Buying is an investment; you really can't lose. Even if all your costs---interest, taxes, utilities, upkeep---even if they add up to $850, it is not going down the toilet. In the end, you have the capital; if you sell your house, you recoup the entire investment.

 

Location, location, location.

I own a 3br, 2 bath 1400 sqft house that I currently have rented for $1400/mo. My tenants there have been there over 3 years, and pay their rent, in full, on time, every month. The mortgage I pay on that property is $762. I bought it in 2012 out of foreclosure for $135,000. Zillow today says it's worth $176,000.

I have never paid a single mortgage payment for that house out of my pocket beyond the 10% down payment.

If you were to buy a similar house, for a similar price, and get 2 roomates, each paying $850 all inclusive, You'd be living for free, putting over $500/mo in your pocket, and have someone else paying for that house for you. You, at this point, don't need to hold a job to live. When you sell the house, you'll recover the equity someone else built for you, plus the appreciation.

BUT, if you choose to hold a job too, then you can start building some real wealth. I don't know how old you are, or what kind of work you do, but if you bring home $40K, invest it wisely making 8% (very doable), in 15 years, you have over a million dollars.

So, if you ask me why you should buy instead of rent... well... I think that's a silly question.

 

No, I'm not because the cheapest house or condo I could find in my city would run me near $1200 a month including water, gas, interest, mortgage, etc ...

That's a $350/month loss for me.

Instead, if I continue to rent and put that $350 towards a savings bond, I will have $21,000 in five years.

You cannot guarantee a $21K profit when you sell a house five years later.

 

If you are making a $850 payment, over the first five years, perhaps $20-$50 goes towards principle each month.

 

True, but the value of a home can as much as double in five years. Or, you can go down in value and be under water.

The rewards are always a function of risk.

 

If you have a "crazy cheap" deal on an apartment, it's probably a good idea to stay put, unless you find a "crazy cheap" deal on a house and plan on staying there, maybe. Every area is different, but housing prices have soared since the crash, and the "crazy cheap" deals you could find in housing 6-7 years ago are hard to come by now.