Dear folks who wish you owned your own home

Baja28

Baja28

Obama destroyed America
czygvtwkr said:
I waited a bit to buy a house, but it was to make sure that my job wasn't cut in the last BRAC. I will tell you that I paid $12k a year in federal income taxes as a renter, the next year I paid $5k and to top it off my income had gone up. I bought a house that had a payment of about 25% of my monthly net income, after all the numbers were ran I came out ahead by quite a bit over renting. The payment/insurance and property taxes are more stable than my rent was also.

I am a big advocate that a house is terrible as an investment, but great as a place to call home, but even after 25 years or so and my house is worth $0 I still come out ahead of the game.
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Shhhhh..... you're ruining her argument worse than she is.

LibertyBeacon said:
I don't rent, dummy.
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Of course you don't. :duh: :liar: Yet you hang around here trying to one up me (and failing miserably) arguing why it's stupid to have a mortgage.

Now off you go to complain about the police state and how you're so tyrannized. :killingme
 
LibertyBeacon

LibertyBeacon

Unto dust we shall return
Baja28 said:
Shhhhh..... you're ruining her argument worse than she is.

Of course you don't. :duh: :liar: Yet you hang around here trying to one up me (and failing miserably) arguing why it's stupid to have a mortgage.
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Yes, if you are under 45 and don't have a substantial net worth (which is attainable, even on modest income), taking a mortgage is among the top 3 dumbest financial decision one can make. Using leverage is great if you are a commercial concern investing in plant and equipment and you expect a tangible return, i.e., business income off of those investments. As much as I loathe Warren Buffet, this quote, attributed to him is just perfect: "If you’re smart, you don’t need leverage. If you’re dumb, you have no business using it."

Go ahead, and use leverage. Leverage yourself 20 or 30:1 to rent a sh!tty townhouse or two to a bunch of crackheads. Hell if you're lucky, you might even find some Section 8 famblees and enjoy your "investments" courtesy of the taxpayer. Leverage to the hilt for all I care. Just understand there's a reason I'm inching further and further right on the wealth bell curve than you ever will.

I bet you've called more than one of those late night "get rich off of real estate" infomercials, haven'tcha? How much you into them for?
 
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sockgirl77

sockgirl77

Well-Known Member
LibertyBeacon said:
Yes, if you are under 45 and don't have a substantial net worth (which is attainable, even on modest income), taking a mortgage is among the top 3 dumbest financial decision one can make. Using leverage is great if you are a commercial concern investing in plant and equipment and you expect a tangible return, i.e., business income off of those investments. As much as I loathe Warren Buffet, this quote, attributed to him is just perfect: "If you’re smart, you don’t need leverage. If you’re dumb, you have no business using it."

Go ahead, and use leverage. Leverage yourself 20 or 30:1 to rent a sh!tty townhouse or two to a bunch of crackheads. Hell if you're lucky, you might even find some Section 8 famblees and enjoy your "investments" courtesy of the taxpayer. Leverage to the hilt for all I care. Just understand there's a reason I'm inching further and further right on the wealth bell curve than you ever will.

I bet you've called more than one of those late night "get rich off of real estate" infomercials, haven'tcha? How much you into them for?
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He's not under 45.
 
LibertyBeacon

LibertyBeacon

Unto dust we shall return
The other thing you could do if you really want to benefit from a strong rental market is make some equity investments in public companies whose business it is to rent property out. Equities outperform real estate as investing goes, so if you really believe in a strong rental market, equity investing is a better approach. There are good and profitable ones out there, and they are probably better than you at finding and evaluating good investment properties. This is what they do for a living. Plus, as these are equity shares, they are more liquid than physical real estate. AND you can much more easily geographically diversify if you want to take advantage of a burgeoning market in Nebraska, for example.

Would you leverage yourself to make those equity investments? I'm guessing no sane and rational person would. So why leverage to buy a house which be default is not a great investment?
 
MarieB

MarieB

New Member
czygvtwkr said:
I waited a bit to buy a house, but it was to make sure that my job wasn't cut in the last BRAC. I will tell you that I paid $12k a year in federal income taxes as a renter, the next year I paid $5k and to top it off my income had gone up. I bought a house that had a payment of about 25% of my monthly net income, after all the numbers were ran I came out ahead by quite a bit over renting. The payment/insurance and property taxes are more stable than my rent was also.

I am a big advocate that a house is terrible as an investment, but great as a place to call home, but even after 25 years or so and my house is worth $0 I still come out ahead of the game.
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That's how I've always looked at it, as a home but not an investment. Not that I never hoped to make money at some point
 
C

czygvtwkr

Guest
LibertyBeacon said:
Would you leverage yourself to make those equity investments? I'm guessing no sane and rational person would. So why leverage to buy a house which be default is not a great investment?
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That is a poor comparison, you buy a house to live in, to make it a home. Taking a mortgage out isn't inherently stupid unless you do it stupidly.

If equities are going to be going down long term, say their business model was disrupted like buggy whip makers were when the automobile became popluar you need to get out and you have not only lost money due to the equity going down but you lost the cost of borrowing that money and other than burn stock certificates or wipe your butt with them there is nothing they are useful for except making you money. However, a house you can still live, love, and make it a home when it is headed down because that is why you bought it in the first place (or should have been).

Careful planning can make debt work for you if it makes sense.
 
LibertyBeacon

LibertyBeacon

Unto dust we shall return
czygvtwkr said:
That is a poor comparison, you buy a house to live in, to make it a home. Taking a mortgage out isn't inherently stupid unless you do it stupidly.
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That's sort of my point. You seem to have a sensible approach to home ownership, but ask yourself: how many people do you think view their home as an "investment"?
 
Baja28

Baja28

Obama destroyed America
LibertyBeacon said:
Yes, if you are under 45 and don't have a substantial net worth (which is attainable, even on modest income), taking a mortgage is among the top 3 dumbest financial decision one can make. Using leverage is great if you are a commercial concern investing in plant and equipment and you expect a tangible return, i.e., business income off of those investments. As much as I loathe Warren Buffet, this quote, attributed to him is just perfect: "If you’re smart, you don’t need leverage. If you’re dumb, you have no business using it."

Go ahead, and use leverage. Leverage yourself 20 or 30:1 to rent a sh!tty townhouse or two to a bunch of crackheads. Hell if you're lucky, you might even find some Section 8 famblees and enjoy your "investments" courtesy of the taxpayer. Leverage to the hilt for all I care. Just understand there's a reason I'm inching further and further right on the wealth bell curve than you ever will.

I bet you've called more than one of those late night "get rich off of real estate" infomercials, haven'tcha? How much you into them for?
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I'm not sure if this is your dumbest post ever or the one where you said you wouldn't talk to the cop while pulled over. :killingme
 
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