Its tough to pick a house!
Comments
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PolkWannabie wrote: »247% of what ? Total Value ?
Given that most people don't buy houses outright that number is somewhat misleading ...
For simplicity ... Assuming one bought a $100k house with 20% ( $20k ) down ... Then that 247% increase on the purchase price is a $247k gain on what was a $20k investment ... There are of course mortgage, taxes, insurance and upkeep costs but the first two are for the most deductible and there would of course be costs to live wherever so from the perspective of owning versus renting those should be a non issue ...
Your post is somwhat misleading. Your investment is the purchase price of the house. The fact that you leveraged the purchase doesn't affect the return. It simply lowers the rate of return based on the fact there is cost of leveraging."Just because youre offended doesnt mean youre right." - Ricky Gervais
"For those who believe, no proof is necessary. For those who don't believe, no proof is possible." - Stuart Chase
"Consistency requires you to be as ignorant today as you were a year ago." - Bernard Berenson -
Unless you pay cash, it's not even close to being a wise investment. Too many expenses involved (interest, insurance, taxes, utilities, maintenance, etc).
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Homeownership is a key factor in building wealth.
Interest, taxes, and tons of other things are tax deductible.
Anyone can rent. But why would you want to pay someone elses mortgage, taxes, insurance, utilities, etc? -
What Shack said...:cool:
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Homeownership is a key factor in building wealth.
Interest, taxes, and tons of other things are tax deductible.
Anyone can rent. But why would you want to pay someone elses mortgage, taxes, insurance, utilities, etc?
I agree but I would never buy a house bigger than what I need just for investment purposes. -
FWIW, I bought a small house(1200sq. ft.) with 3.5 acres of land behind the house.
That way, I don't feel like I'm back in the hood, when someone builds behind me.
I look at it as a piggy bank. I most likely won't get rich if/when I sell, only because theres SO much undeveloped land down here, that it'll stay undervalued into the next millenium!I refuse to argue with idiots, because people can't tell the DIFFERENCE! -
Shack, Bob & Willow all get it.
I have mutual funds & a 401k. These are LONG TERM investments that I don't plan to touch until I retire. Therefore I don't have to worry about what the market is doing right now.
When I buy a condo, it is so I can have a safe secure, livable, finacially manageble roof over my head. I plan to be there until they either take me out in a box or until I have to move to a nursing home. I don't plan on making any money out of it, that is what my funds & 401k are for in about 18-20 yrs time.
Those I will tweak & adjust over the years to make sure I stay on track. Those I have some control over. I have ZERO control over the housing market, therefore, I should not be thinking of my ONLY home as an investment.Marantz AV-7705 PrePro, Classé 5 channel 200wpc Amp, Oppo 103 BluRay, Rotel RCD-1072 CDP, Sony XBR-49X800E TV, Polk S60 Main Speakers, Polk ES30 Center Channel, Polk S15 Surround Speakers SVS SB12-NSD x2 -
Again, there's absolutely NO reason a home can't be a good investment and a place you enjoy. The house you move into in your 20/30s likely isn't going to be the house you'll be living in when you're in your 50s. It's wise to plan accordingly by making a good investment.
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Anyone can rent. But why would you want to pay someone elses mortgage, taxes, insurance, utilities, etc?
And anyone can buy a house as well and even a house that they can't afford! The reasons you listed above requires a more detail analysis than just saying I don't want to pay for someone elses mortgage, taxes, etc.
The typical American dream of home ownership was squashed with the inflated prices the past few years that owning doesn't always make sense. If you have to dumped all your money to a home then it's a bad investment.
Tax break or not, why do you want to pay interests.
A few had post had suggested not buying more home than you can live and that's a very important point. I would suggest finding the right neighborhood and then findind a home that is close to what you want and then "make it your home" with some refining.Main Gear
Panasonic 50" Plasma, Polk LSi15 (Front), LSiC, LSi7 (Rear), Sherwood Newcastle AVP-9080, AM-9080 bi-amp to LSi15, AM-9080 bi-amp to LSiC and LSi7. -
I'm not saying a home can't or shouldn't be both an investment and a home. I'm just saying, as far as priorities go, I'd sacrifice some abstract future investment benefits for livability. Everyone who buys a house makes a weighted list of things they want; the top of my list would include the things that make my home a great place to live for me, not the things that I think would net me a better resale value (though those things would be on the list, just not as high).If you will it, dude, it is no dream.
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Demi is right on, a home is BOTH.
A home is a fine long-term investment. Yes it takes money to keep it up, but I can't complain as in the 17 years of home ownership I've managed to build up a fine nest egg. But it should never be considered the main long-term investment vehicle, one of two is fine.
I personally believe that if you do one major repair/upgrade per year and leave the home in better shape than when you purchased it, financially you'll do just fine after 5 years.Review Site_ (((AudioPursuit)))
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This is all GREAT info! I'm impressed.
madmaxVinyl, the final frontier...
Avantgarde horns, 300b tubes, thats the kinda crap I want... -
The first thing most people look at when buying a home is the school district. The BEST way to find the best school is to use the feds free lunch program stats to your advantage. Find the district with the least amount of free and reduced lunch kids,then find the school in the district with the least amount of free and reduced lunch in it. You will find that that school will draw from higher class neighborhoods that will give your kids connections and contacts(you will get some too with your neighbors) that will serve them for a lifetime. I raised my first 2 kids in a 78% free and reduced lunch school,the last 2 in a 1% free and reduced lunch school and cannot believe the change. I built a house in a 1% neighborhood with a grade,middle,and high school within walking distance and have a list of people that want to buy it when we are done with kids in school,the average home sells in 22 days in this neighborhood,within 2% of asking price,even in this crappy market. Schools are the key to a liquid investment in a home,if you call it an investment,I do not,it is a tool I need to live and prosper.
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Our area is in very high demand, yes it's in the burbs, yes there is a man made lake near by (3min walk) there will be a new school, (another 3min walk). We have been in our house (as mentioned) for less than 1 yr. If we were to sell our house right now, we could make 30K, if not a bit more. Were else can you make this kind of cash without having to do anything. I'd call that a very good invesment. My dad and step mom are in their early 50s, paid off their mortgage and dad retired last year. Big investment there, all they pay is land taxes and utilities, which you'd have to pay anywhere (even if it's included in your rent). We (my wife and I) look at it as an investment, yes we can make a nice chunk, but it's a personal invesment. I would agree that for the first couple yrs it looks like you're no paying off the principle and here in Can, we can't claim the interest on Taxes. (not that I'm aware of). There is no right or wrong answer as to if buying a house is good or not, there is only THE right answer, which is, Yours! As in everything else in life there are pros and cons to it.
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just be sure that the lot slopes away from the home,not into it. Good luck.JC approves....he told me so. (F-1 nut)
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And anyone can buy a house as well and even a house that they can't afford! The reasons you listed above requires a more detail analysis than just saying I don't want to pay for someone elses mortgage, taxes, etc.
The typical American dream of home ownership was squashed with the inflated prices the past few years that owning doesn't always make sense. If you have to dumped all your money to a home then it's a bad investment.
Tax break or not, why do you want to pay interests.
A few had post had suggested not buying more home than you can live and that's a very important point. I would suggest finding the right neighborhood and then findind a home that is close to what you want and then "make it your home" with some refining.
I didn't mean to imply that buying is the right thing for everyone, nor did I mean to imply that buying more than needed or planned for is a good thing.
I don't think anyone ever WANTS to pay interest. It's hard enough for some to save up for a down payment, much less the entire purchase cost of a home. Even if a person has $200k to buy a house flat out, it might be better to put some down and pay a mortgage with interest... and invest the rest and keep some of your money liquid.
I did mean to imply that someone who "doesn't plan on making any money out of it" probably won't make any money, and that if one plans and does things right they can make money out of it. I know which one I'd prefer. -
We looked at over 40 houses before we picked the one we're in now.
I'm pretty sure our agent hated us.My equipment sig felt inadequate and deleted itself. -
And anyone can buy a house as well and even a house that they can't afford! The reasons you listed above requires a more detail analysis than just saying I don't want to pay for someone elses mortgage, taxes, etc.
The typical American dream of home ownership was squashed with the inflated prices the past few years that owning doesn't always make sense. If you have to dumped all your money to a home then it's a bad investment.
Tax break or not, why do you want to pay interests.
Well, I'd certainly rather pay my own interest, get the tax breaks and build equity in something than flushing my money down the toilet to pay for someone else's interest and equity.
You need to live somewhere, might as well be yours-Most cities, you can find a house in a similar area and similar size to your apartment for the same money. Unless you don't plan to be in the property in 2-3 years, it makes NO sense to rent.There is no genuine justice in any scheme of feeding and coddling the loafer whose only ponderable energies are devoted wholly to reproduction. Nine-tenths of the rights he bellows for are really privileges and he does nothing to deserve them. We not only acquired a vast population of morons, we have inculcated all morons, old or young, with the doctrine that the decent and industrious people of the country are bound to support them for all time.-Menkin -
jdhdiggs wrote:You need to live somewhere, might as well be yours-Most cities, you can find a house in a similar area and similar size to your apartment for the same money. Unless you don't plan to be in the property in 2-3 years, it makes NO sense to rent.
This is an extremely broad statement. Home ownership is NOT FOR EVERYONE. I have clients that could own a home...but choose not to for various reasons. What makes no sense to one person...makes absolute sense to another...both personally and financially."Just because youre offended doesnt mean youre right." - Ricky Gervais
"For those who believe, no proof is necessary. For those who don't believe, no proof is possible." - Stuart Chase
"Consistency requires you to be as ignorant today as you were a year ago." - Bernard Berenson -
Really? Under my parameters (The one's in the above post), how would it make more sense for someone to spend $1,200/month on rent and not $1,200 on a morgage? What are these scenario's?There is no genuine justice in any scheme of feeding and coddling the loafer whose only ponderable energies are devoted wholly to reproduction. Nine-tenths of the rights he bellows for are really privileges and he does nothing to deserve them. We not only acquired a vast population of morons, we have inculcated all morons, old or young, with the doctrine that the decent and industrious people of the country are bound to support them for all time.-Menkin
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This is an extremely broad statement. Home ownership is NOT FOR EVERYONE. I have clients that could own a home...but choose not to for various reasons. What makes no sense to one person...makes ablsolute sense to another...both personally and financially.
Agree and that's why one need to run through the numbers to do a real comparison. Home ownership isn't just home buying a home an paying mortgage. There are so many variables.
Take for example:
A single person renting a 1-2 bedroom condo in my area.
Renting:
Pay rent ~ $1100/month
Pay utilities
Pay renter insurance
A single person buying a 1-2 bedroom condo
Pay mortgate (a comparable condo would be $150K and up)
Pay association fee ~ $150/month
Pay property tax ~ $2500-$3000/year
Pay home owner insurance
Pay utilities
Supply your own appliances
Pay commision if you do sell your property.
I pick a simple comparison using a condo to take out the maintenance variable. Remember that a single person isn't going to get a huge tax break on the interests paid either.
BTW: jdhdiggs, It may make more sense for you to buy in your situation and especially your town. I should have bought a house there 5 years ago.Main Gear
Panasonic 50" Plasma, Polk LSi15 (Front), LSiC, LSi7 (Rear), Sherwood Newcastle AVP-9080, AM-9080 bi-amp to LSi15, AM-9080 bi-amp to LSiC and LSi7. -
Really? Under my parameters (The one's in the above post), how would it make more sense for someone to spend $1,200/month on rent and not $1,200 on a morgage? What are these scenario's?
$1,200 a month on rent is $1,200. A $1,200 mortgage payment is the mortgage payment, plus taxes, plus utilities, plus maintenence, plus insurance on the dwelling, plus landscaping, plus pest control, etc..., etc... Some like the convienience of renting, some like to "invest" the funds needed for home ownership in more lucrative vehicles, some like the portability of renting, some don't like the hassle of selling when they decide to move. As I said...your criteria for what makes sense isn't the same for everyone. Priorities differ."Just because youre offended doesnt mean youre right." - Ricky Gervais
"For those who believe, no proof is necessary. For those who don't believe, no proof is possible." - Stuart Chase
"Consistency requires you to be as ignorant today as you were a year ago." - Bernard Berenson -
I should have said Morgage+Escrow (which is what I meant).
Each of the 7 cities I've lived you can handle all of the expenses except yard care in the price of renting an equivelent property. And as you said, it's preference, not a financial decision that drives the decision, not a set of financial criteria.There is no genuine justice in any scheme of feeding and coddling the loafer whose only ponderable energies are devoted wholly to reproduction. Nine-tenths of the rights he bellows for are really privileges and he does nothing to deserve them. We not only acquired a vast population of morons, we have inculcated all morons, old or young, with the doctrine that the decent and industrious people of the country are bound to support them for all time.-Menkin -
jdhdiggs wrote:And as you said, it's preference, not a financial decision that drives the decision, not a set of financial criteria.
Actually it's not. A study by economists for the Federal Reserve System say that housing is currently overpriced relative to rents. Their research indicates that housing prices would have to decline by 15% per year for 5 years and rents increase by 4% per year for the period for there to be a normal (historical) rent/own relationship. In other words in real economic dollars it makes more sense to rent vs own. You get more benefits TODAY from $1,200 spent on renting vs $1,200 spent on owning...and that includes the tax benefits and "future value".
You also have to remember that not everyone gets a tax advantage from home mortgage interest. Some have too little income for it to be of any benefit...some have too much.
I didn't say it was just preference...I said to some it was a matter of priority. Different things."Just because youre offended doesnt mean youre right." - Ricky Gervais
"For those who believe, no proof is necessary. For those who don't believe, no proof is possible." - Stuart Chase
"Consistency requires you to be as ignorant today as you were a year ago." - Bernard Berenson -
All other things being equal, I'd be looking for no noisy little monsters running around screaming at the top of their lungs and no teenager/early 20's types that like to cruise/hang out and blast hip-hop and rap crap till all hours. I'd want something semi-custom at least and ideally not a tract home. Privacy and a view would be high on the list. Of course I'm an old and unsocial ****. :cool:2 channel - Willsenton R8 tube integrated, Holo Audio Spring 3 KTE DAC, audio optimized NUC7i5, Windows 10 Pro/JRiver MC29/Fidelizer Plus 8.7 w/LPS and external SSD drive, PS Audio PerfectWave P3 regenerator, KEF R3 speakers, Rythmik F12SE subwoofer, Audioquest Diamond USB cable, Gabriel Gold IC's, Morrow Audio SP5 speaker cables. Computer - Windows 10/JRiver, Schiit Magni 3+/Modi 3+, Fostex PMO.4n monitors, Sennheiser HD600 headphones
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I don't know about all this gobly **** we are talking about. I bought my first house 18 years ago. I have done nothing to it for 18 years. I sold it for twice what it cost me new. If you take the total I paid over the years on insurance, HOA, mortgage, taxes, everything, divide it up over the time I lived there and subtract the sales price it ended up costing me $81 per month to live there. This could have been less if I had actually done anything to the house. Lets say I rented an equal place. Pretty much it would have cost me about $1200 a month. Why would I EVER prefer $1200 a month over $81 a month?
madmaxVinyl, the final frontier...
Avantgarde horns, 300b tubes, thats the kinda crap I want... -
It would have to be an extreme situation for it to be better to rent. Like say if you totally over extended yourself to buy a house with zero down and have a 1500 a month mortgage as opposed to a 600 a month rent and extra cash to save for a future house purchase or live in an area with extremely high taxes or something.
The thing I disagree with is over buying. You would be better buying a 200k house and investing 100k than buying a 300k house and not having extra money.
I personally bought modest because being self employed you can never be sure how much you will make, the time I spent injured I would have been in foreclosure if I over bought. But hopefully if things go as planned I will have the house payed off at 45 and I will have the freedom of knowing nobody can throw my **** out -
Woo hoo... Put a contract on a house today! 4500 sq ft, 5 years old, all the excessive ammenities like wood floors, granite and tile, super development, 25' ceiling in the great room, catwalk looking down into the living room and kitchen, walk out basement, excellent mountain views, very well decorated, gourmet kitchen, 4 bedrooms plus two offices, 4 car garage, 4 bathrooms, you name it. Looks like new.
First off, my main audio room will be the great room with the high ceilings. This will house the TT, Avantgardes and Manley equipment. The Master bedroom is something like 16 x 22'. It will be the showroom for the SDA's, soundcraftsment amps, theta/audionote CD transport/dac. The formal livingroom will sport a pair of carver amazings with unknown amplification and a Proceed transport. One of the offices will be the showcase for the DQ-10's. In the basement there will be plenty of room for a home theater complete with projector, 4 18" subs, and theater seating. The other 3/4 of the basement will end up being something, not sure what yet. The decks are awesome! You can set there and look as far as the eye can see with the rocky mountains as the backdrop. I'm seeing an outside fireplace, comfy seating and an nice little stream and pond to enjoy.
I plan on making the garage a living sort of area where you can enjoy the space with finished floors but can still pull the car in. In theory you could be sitting in a comfy recliner, watching a movie on the plasma and still enjoy seeing the camaro parked in the corner next to you. This could be an awesome setup!
Oh yea, its not all a bed of roses. The lot is only 1/4 acre and has houses on both sides. There should never be one behind it though. Heating and cooling is certainly going to be a concern too. It does seem to be exceptionally insulated though. I didn't get a lot of discount on it but then again, compared to everything else I looked at it seemed to be very realistically priced to start with. Other similar homes in the area were quite a bit more.
I hope this is enough room for me. I've lived in a 1000 sq ft house for the past 18 years.
madmaxVinyl, the final frontier...
Avantgarde horns, 300b tubes, thats the kinda crap I want... -
LOCATION x 3. No joke.
Gas is getting expensive and that trend is likely to continue. Buy a house that has been thoroughly updated with all the granite and good windows, and recent appliances mentioned above, but get one with a close commute, near to bars and restaurants and close to grocery shopping. Can you walk everywhere or get to public transportation easily? In ten years, that is what people will value. Think like a European. Stay away from the suburbs; gas ain't free anymore. These kind of houses will appreciate in value while the suburbs will be dead when gas passes 5 buck per gal.
And, as was suggested above, have a woman review you three favs because in 10 years when you try to sell the place it will be a woman making the buying decisions. Some damn thing you never noticed can make selling it a living hell. Been there. Hint: kitchens are important.
And don't over-buy. You still have to pay taxes and maintain the damn thing.The world is full of answers, some are right and some are wrong. - Neil Young -
Good call,
I actually thought about the future walkability of the place. While you can walk to the grocery, beer store and home improvement center you will never be able to walk to a job. It is faily close to the highway and lends itself to someone working in Denver if they want to commute. The lower levels of employment are approximately 12 miles away in Fort Collins and Loveland. My job is in Loveland. I guess if push came to shove you could ride a bike to those locations.Vinyl, the final frontier...
Avantgarde horns, 300b tubes, thats the kinda crap I want...