anaylst states owning a home is a scam

[Slew Foot]

Hard to say.

How will you feel when the owner defaults and the new owner (probably the bank) shows up and tells you to move out? (BTW: Hope that doesn't happen to you)

Usually not a good situation for anybody, it's just that some people's (the landlord's in this case) are worse than others.

Fern

You cant do that in CA, the renter gets a year to move if the house gets foreclosed.

 

[Slew Foot]

If you bought the house today, what would your mortgage payments be?

Id estimate the current market value of the house at 1 mill. Whats the total mortgage(PITI) on that? I think property tax alone is 12K/year per the assessor.

 

[Zebo]

You cant do that in CA, the renter gets a year to move if the house gets foreclosed.

Hey if we're talking deadbeatism buying is even better now. Banks refuse to foreclose these days because they would have to take the writedown sending their balance sheets further in red zone catching eye of FDIC.

Again the only time to rent is transient, rents are significantly (~25&#37 lower than mortgages, or no other option. All things considered the scale favors home ownership.

 

[Vic]

Id estimate the current market value of the house at 1 mill. Whats the total mortgage(PITI) on that? I think property tax alone is 12K/year per the assessor.

About $5k/mo after 20% down.

Pretty fly pad for Davis BTW.

 

[Vic]

You cant do that in CA, the renter gets a year to move if the house gets foreclosed.

*bzzt* wrong answer.

 

[Slew Foot]

About $5k/mo after 20% down.

Pretty fly pad for Davis BTW.

Not in Sacramento anymore, moved to San Jose.

Id be buying real soon in Sacramento, homes prices there have dropped 50% of so. Even in the nicer suburbs (Granite Bay, parts of Carmichael and Roseville) what used to be 1.2 million is down to 700K.

 

[Zebo]

Not in Sacramento anymore, moved to San Jose.

Id be buying real soon in Sacramento, homes prices there have dropped 50% of so. Even in the nicer suburbs (Granite Bay, parts of Carmichael and Roseville) what used to be 1.2 million is down to 700K.

Still too high for long term. Salaries are decreasing and joblessness is increasing. Furthermore, many more people who still have means, are choosing to strategic default and this phenomena will grow as more foreclosures sit in their neighborhoods wreaking their homes value.

My conservative estimate is housing will decline in value at least another 70-90% from current levels.

 

[PrinceofWands]

Still too high for long term. Salaries are decreasing and joblessness is increasing. Furthermore, many more people who still have means, are choosing to strategic default and this phenomena will grow as more foreclosures sit in their neighborhoods wreaking their homes value.

My conservative estimate is housing will decline in value at least another 70-90% from current levels.

I FERVENTLY hope you're correct. I can't imagine a better way to right the economic base of the nation than this.

 

[OutHouse]

A home is an investment in yourself. You decide what to plant in your yard, what color the walls are, what kind of flooring you want to walk on, whether you can have a dog. It's an investment in a community, a place to belong, a place your kids grew up in.

But there are pin heads like this asshole who see only money.

i agree 100% with this.

 

[OutHouse]

yeah and you know what? that makes me laugh and happy. hope the fucking company goes bancrupt and the houses sit empty costing the city tax money. fuck em.

I understand if you need a road, school, park or safety issue. But this bullshit of takeing private property to give to a BUSINESS really rubs me the wrong way.

glad IL passed a law on it...though they left loopholes.

it rubs the constiution the wrong way. I still can not believe the SOCUTS ruling on this. every one of them should have been thrown out.

 

[Zebo]

I FERVENTLY hope you're correct. I can't imagine a better way to right the economic base of the nation than this.

How does that right anything? It makes it worse since majority of Americans have their home as largest asset. This will weaken their position further. Remember wealth is about what you control not money which is just score keeper and trading device. As Americans control less visa vi their home depreciation so will their opportunities dry up. E.G. Want to start a business? ...sorry you have no equity or wherewithal.

 

[OutHouse]

Why do you think all the builders and developers are or are going broke? Why am i buying fixers in the 1400-1800 sqft range instead and sitting on lots? Everyone and their brother was building McMansions last 10 years and it's over. Only the small stuff moves now and only because Obama has an extra 8K out there still over extending people. When that ends in April SWHTF IMO coupled with Alts/options and Benny the B gonna raise rates.. Trifecta disaster coming IMO but in the meantime there is some short term deals out there.

there are a lot of those mcmansions developments around the Denver metro area and its just sickening of how many are vacant. nobody wants to buy them because they are still wanting 400K+ for them and the taxes for owning one are through the roof.

 

[JS80]

Assuming the ridiculous unlikelihood that the rent is never increased, $3200 for 360 months is $1,152,000. At the end of which, you have nothing.

Market fluctuations aside, if homeownership is such a poor investment, then why have I never met a wealthy person who did not own their home? And by wealthy, I mean long-term and set, not some kid out of college with high income but little net worth.

What's 5k minus 3200 x future value factor of an annuity for 360 months??

 

[JS80]

How does that right anything? It makes it worse since majority of Americans have their home as largest asset. This will weaken their position further. Remember wealth is about what you control not money which is just score keeper and trading device. As Americans control less visa vi their home depreciation so will their opportunities dry up. E.G. Want to start a business? ...sorry you have no equity or wherewithal.

The best way to clean excesses in the economy is to let the shit crash and start over.

 

[PrinceofWands]

How does that right anything? It makes it worse since majority of Americans have their home as largest asset. This will weaken their position further. Remember wealth is about what you control not money which is just score keeper and trading device. As Americans control less visa vi their home depreciation so will their opportunities dry up. E.G. Want to start a business? ...sorry you have no equity or wherewithal.

Homes were never intended to be assets...they're HOMES. The ability to own a home is an essential element of life (to many, if not most). Life isn't about assets, it's about living, and that requires shelter.

Artificially inflated prices hurt almost everyone unless individual earnings match the escalation in cost of living, which hasn't happened. The higher prices on newer houses cause older home prices to readjust to keep pace, pricing out long time owners due to property taxes (and potentially insurance). That's on top of keeping people from being able to afford a home in the first place if they're buying. In order to combat the costs of this basic life necessity everyone is forced to charge more for everything they do or sell to compensate...this forces inflation upon a nation that has no potential to meaningfully increase earnings to keep pace.

The exorbitant prices force multiple income households, which are central to the decline of our society. Housing costs keep people from using their money on other things, like healthier food/lifestyles, hobbies, vacations, charities, etc.

A return to reasonable real estate prices resets the playing field somewhat. It's not a solve-all, but it's a hell of a good start. Unfortunately we desperately need commercial real estate to do the same...maybe even more so than residential properties.

 

[Drift3r]

This is the very best moment in recent US history to actually buy a home. Of course its the opposite if you are looking to sell. This guy misses the point that people need to be on the right side of the equation to benefit from buying a home. Also homes are not short term investments (never have been and never should be for the the average person) for most people they are long term investments which pay off when they go to sell when/if the economic situation allows for a successful and quick sale. Meanwhile people should being actually living in their homes to get the best value out of it. This guy really is wrong on many levels.

 

[JS80]

This is the very best moment in recent US history to actually buy a home. Of course its the opposite if you are looking to sell. This guy misses the point that people need to be on the right side of the equation to benefit from buying a home. Also homes are not short term investments (never have been and never should be for the the average person) for most people they are long term investments which pay off when they go to sell when/if the economic situation allows for a successful and quick sale. Meanwhile people should being actually living in their homes to get the best value out of it. This guy really is wrong on many levels.

no, not really

 

[ElFenix]

i wonder what that graph looks like going further back to, say, the start of the middle class single family home era in the 50s?

 

[JS80]

i wonder what that graph looks like going further back to, say, the start of the middle class single family home era in the 50s?

 

[ElFenix]

well that was quick

 

[7window]

Look at the video... the guy is a loser who lives in his mom's basement.

Two scenarios:
I want to spend $1000 a month on a place to live for the the next 10 years.

Option 1: I rent for $1000 a month for ten years. At the end of ten years I walk away with nothing.

Option 2: I buy a $185,000 house using a USDA no money down loan at 5% interest. My payment is approx. $1,150 a month. (that includes taxes and insurance) However, thanks to the mortgage interest deduction I save $150 a month on federal taxes thus making my effective monthly payment $1000.

At the end of 10 years my house is now worth approx. $200,000 (based on 1% appreciation per year)
And my loan balance is $150,000.

Selling the house will cost me 10% of its value or $20k.

So selling the house after 10 years will leave me with $30,000

I think I'll take option 2, thank you

what about upkeep on the house. What if you need roof or painting, pest control?

 

[JS80]

well that was quick

that's how i roll

 

[JSt0rm]

^^^I love how the "experts" were saying it wasn't a bubble

 

[LegendKiller]

^^^I love how the "experts" were saying it wasn't a bubble

Hey now, Larry Yun and David Lareah were very objective in their opinions...