Owning A House Is So Whatever You Call That Last Decade

Houses continue to become more affordable, but since nobody has any money or can get approved for loans, ownership has taken a nosedive.

Fox News reports ownership levels are the lowest they’ve been since 1999, with only 66.9 percent of households currently owned by their dwellers. In 1999, the level was 66.7 percent. The story infers the past decade’s high home ownership rates were a bit freakish because ownership hovered at 64 percent from 1985 to 1995.

Owners, renters, why does it make more economic sense for you to do what you’re doing?

U.S. Homeownership at Lowest Level in a Decade [Fox News]

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  1. deejmer says:

    For the life of me, I can’t figure out what that headline is supposed to mean.

  2. HogwartsProfessor says:

    It cost more to rent when I bought my house in 2002. I literally couldn’t get an apartment for less than $500-600 a month, and that was a one-bedroom. My mortgage payment is around $400 and I get a whole house and a yard to boot.

    Of course, I have to mow and fix stuff myself. That’s the drawback.

    • Nigerian prince looking for business partner says:

      That’s how it is where I live. I pay around ~$400/month for my mortgage and another $200/month for insurance and taxes. It would be tough to rent a similar house in a similar neighborhood for less than $1,200/month.

      The rental market is grossly distorted due to student housing and a prevalence of section 8 housing.

      • nbs2 says:

        Where do you people live? And what do you people live in?

        I live 50 miles from the hub of my MSA, have a freakishly long commute, a greater than 20% down payment, in a nice (but not spectacular) house that was bought out of foreclosure. I still pay more than double what you are paying.

        • Nigerian prince looking for business partner says:

          I live in a midwestern city of about 50,000 (the metro area is about 150,000). My neighborhood is mostly two story brick houses from the 1900 – 1930. I live in a 2 1/2 story American Foursquare (1700 sq ft on a 140-x-40 lot) that was built around 1915.

          Paid $95k for it several years ago and it’s now worth $105k. I just refinanced and my mortgage payment is now less than $400/month. I doubt that it will ever appreciate more than 1 or 2% a year but it will feel good to have it paid off in a few years.

        • BHall says:

          This is my house:

          http://www.zillow.com/homedetails/1800-E-76th-St-Kansas-City-MO-64132/2422176_zpid/

          I pay $458.57 Principal & Interest and $174.27 into Escrow each month.

    • ArcanaJ says:

      I am absolutely gobsmacked by how low your mortgage is.

      • dolemite says:

        I had a similar mortgage when I got my house…around $430 for mortgage, $100 for insurance and tax.

        Apartments were $600-$800.

        Of course I refinanced and rolled up a bunch of debt so my mortgage is now $630 a month, but oh well.

    • FatLynn says:

      No, no, no, you have the FREEDOM to fix stuff yourself instead of calling your landlord and waiting weeks for her to take care of the problem!

      • Nigerian prince looking for business partner says:

        I’m always amazed at the people who had good experiences with landlords fixing problems. After 20 years of renting, I can’t think of a single problem that was resolved quickly, with reasonable replacements, and a quality installation.

        • pecan 3.14159265 says:

          I’ve been spoiled because my complex is very good about fixing things in a timely fashion. They’ll even do little things like fix squeaky doors.

        • junip says:

          Yah, it would be nice if my landlord responded to all my requests to: fix the shared washer machine drainage so it doesn’t flood the floor, trim the tree so it stops banging on the roof, clean the building’s hallways *at least* once a year (it’s in the lease that they’re supposed to keep it clean), oh yah, and fix the building’s fire alarm system that has been broken and turned off since it went wacko last year and went off 3 times for no reason. Aaand they owe me interest on my security deposit for the last 3 years. Sigh.
          As long as I can find a house at roughly the same price as renting, I’ll jump on it, if only so I can take action when something breaks or if I want to renovate.

          • Mewf says:

            Depending on your state…but you can actually withhold rent until the landlord fixes items that have been requested to be fixed (you generally want this in writing). If they give you a 72 hours notice and take you to court to evict you, you just present the judge with your defense.
            However, you cannot (CANNOT) spend the rent, you have to set it aside and let the court know you have set it aside, ready to be paid upon repairs being done.
            Check with your state laws for clarification.

        • thedarkerside.to says:

          I think there’s a difference if you rent a Condo / apartment where there are many units and they have the staff to keep it going or if you rent a single family home from a reluctant landlord that does it because he sees it as an investment.

          In the first one there is motivation to keep the place in good shape, the latter one only does what he absolutely needs to do, after all, every penny he spends on fixing up the property is less profit he envisions getting.

        • Awesome McAwesomeness says:

          This is why we rent an apartment in an upscale community with a reputable management company. We get same or next day service. It’s awesome.

    • The_Fuzz_53 says:

      Where the hell can you live with only a $400/month mortgage payment. Here in NJ, my taxes alone are $500/month.

      • Nigerian prince looking for business partner says:

        The USA is a big country and there are still many places where typical housing costs are in the ~ $100,000 ballpark.

        • MrEvil says:

          ^This

          There’s more to the US than the coasts. Pretty much anywhere in the midwest is cheaper than the coasts to live. My sister pays less for her mortgage than I pay in rent. But I don’t have to have home-owner’s insurance or pay property taxes (but I do pay my landlord’s property taxes) and my renter’s insurance bill won’t make a pimple on the ass of a home-owner’s premium.

          Rent is generally always going to be higher per sq ft than a mortgage because your rent pays the landlord’s property taxes and insurance, plus maintenance and other fees remitted to the government. Unless you have escrow on your mortgage (where your taxes and insurance are paid by the servicer on your behalf) your mortgage payment doesn’t factor in all those ancillaries.

      • waltja26 says:

        Here in the Buffalo area, I own a small ranch house on a decent 7500 sqft lot. My mortgage is $430 per month. That’s great. My property taxes amount to $350 per month. That’s not so great. Are your taxes 80% of your mortgage? My state has overwhelmingly decided to keep everything as is. What is your definition of insanity?

      • Skankingmike says:

        I was going to say the same as a fellow NJite. Probably midwest :P

    • Kate says:

      Wow, I own a crappy tiny little house in a small midwestern town that I rent out and it’s 500 a month, I hate to think of where you are living.

  3. TuxthePenguin says:

    I think we’ve hashed out all the financial reasonings you could possibly want to look at when deciding to rent or own, but I really think that owning a home is more about the non-financial factors than the financial ones. Especially since you can rarely find a rental that would be compatible to the home you would be looking to buy (especially if you want a larger house or a newer house).

    I think it more has to do with the feeling of putting down roots than anything else. When you rent, you have in the back of your mind that this isn’t permanent. When you own, its MUCH more permanent – the costs and hassle of moving are much higher.

    • Me - now with more humidity says:

      We were lucky — 1800 square feet a five minute walk from the beach. Similar mortgage payment would put us in 1200-1500 square feet without a pool, possibly farther inland. But every market varies.

      I’ve done the putting down roots thing. Trust me, you get over it

  4. NashuaConsumerist says:

    So far owning a house has been beneficial, but I do have roommates. If it were just me and the mortgage I’d have to cut cable, internet and any luxury to stay afloat. I’m prepared to do that if I need to, but I’d rather just bitch about me having to clean up after them and build some equity…

  5. crazedhare says:

    I wouldn’t own a house if you bought it for me – and I have turned down two parental offers to to so. Between taxes, insurance, routine maintenance and care, I can’t think of a less attractive option. I don’t want to mow the lawn, I don’t want to deal with plumbers, I don’t want to pay property taxes, I don’t want to be sued when your dumb kids trip on my sidewalk. I will happily cut a check on the first of every month to allow some other sucker to deal with that though.

    And lest you tell me it’s a good investment, it’s not. There’s a NY Times calculator in which you enter rent costs, mortgage and interest for two similar properties in your zip code and it tells you how many years it would take of paying a mortgage before you financially improved your circumstances over rent. In my zip code, it was 32 years. I would have to spend 32 years in the same damn house to earn money off the moneypit.

    No thank you.

    Beyond that, the freedom to very easily and simply move in case of layoff, natural disaster, zombie outbreak, inherent personal shiftiness or for whatever other reason is worth an enormous amount to me.

    • TuxthePenguin says:

      There really are only two main arguments, financially, in the own versus buy rate. The first is that with a mortgage, you freeze your housing payments for 30 years at some level (assuming a standard mortgage). That means if inflation kicks up to 4-5%, you’re not paying more for housing. The second is that after those 30 years, your housing payment drops to $0 and at that point you really start to break away.

      Well, there is a third – property taxes/repairs/etc. While they aren’t explicit in renting, they are wrapped up into the cost of the place.

      The big problem I have with the “buy versus rent” is that it doesn’t include an additional modifier of how much rent will increase above inflation. Maybe not a modifier, but a multiper of some kind. Its tough to model how profit motivated someone is. It also doesn’t include the cost of moving.

      But what you said is the big thing – its a non-financial choice more than anything. The hassle of home ownership (there is one) is what I think most people don’t think of and don’t weigh.

      • crazedhare says:

        As a renter, should the rent increase I can easily downsize. If you are going to attempt to calculate for the cost of inflation – certainly reasonable to do – I think you have to calculate for the increase in property taxes as well. Our property taxes have increased at a higher net effect than my rent has, according to those I know who own in the same zipcode.

        • pecan 3.14159265 says:

          Right! If the rent goes up, you can move somewhere else. When we moved, we went to four different apartment complexes all on the same street. There are always options.

          • TuxthePenguin says:

            True, but there is a cost of moving that you’re not including in the NYT calculator…

            • jeepguy57 says:

              Also, its not just the monetary cost of moving, but the pain-in-the-butt part of it all, too. Plus if you have kids, renting and having to move can be very taxing on them, especially if that cheaper rental is in the next town over.

              • lettucefactory says:

                Yeah, exactly. We were a lot of “rah-rah renting!” until we started to have kids. That just threw a whole new level of complexity on there. We do still rent because we don’t have a downpayment to buy, and other reasons, but I mostly wish we didn’t.

                We’d probably rent indefinitely if we’d been childless, though.

              • junip says:

                I think part of my desire to have a home that I can really call my own and fix/renovate/customize to how I like it is the fact that growing up, my mom always rented, and we moved every two years like clockwork. It always felt very unstable, and I had been in 8 different schools by the time I graduated high school.

                • thedarkerside.to says:

                  That’s perfectly fine, just don’t be under the illusion you’re investing your money.

                  • crazedhare says:

                    That’s sort of the way I see it – if people really want to own a home then it IS a great purchase for them! And many people do want to own, and so they should pursue that.

                    But unless you want the extra cost and responsibility associated (and, just to be clear in case the above leaves any room for doubt, I don’t – haha), then it is a bad deal. I think there was a time, and there may still be in certain places (not where I live), that it is still a good deal – but crunching the numbers shows me that for me, home ownership would be a wholly unjustifiable expense.

            • crazedhare says:

              Well, in fairness, the cost of moving due to necessity of downsizing would then also have to be included in the mortgage too. And the cost of moving from an owned home is ostensibly higher.

        • Loias supports harsher punishments against corporations says:

          Property taxes are factored into your mortgage when you buy it. The inflation of these tends to be less than the inflation of renting prices.

          And you can only downsize so far. My current home’s mortgage + HOA fees is less than my apartment rent was, and the apartment was half the size.

          This versus the home, which you never have to downsize.

          • crazedhare says:

            Well, I used the calculator based on the flat cost of the available type of home around here for someone in my age and income bracket. If I should add taxes to that for the comparison, then the cost of mortgage/home ownership would go up. Perhaps that distinction is why I got 32 years last I ran it, and 19 now – because in running it today I was vastly underestimating the cost and perhaps I had included an allocation for taxes last time I seriously looked at this.

            Wow, you just made home ownership even less attractive. I didn’t think that could happen – between your suggestion that HOAs would give me heretofore unknown freedoms (/snort), and that I was underestimating the cost of buying, I owe you one. I almost was swayed by some others’ comments.

            • dragonvpm says:

              Ok, seriously? Have you actually looked at what a HOA covers vs what your standard lease covers? A HOA basically governs what you can do to your home as far as the exterior goes and what you have to pay maintenance fees for (e.g. landscaping, amenities etc…). Generally they don’t dictate what you to inside your home as far as paint, finishes, pets etc…

              I actually rented an apartment for about 6 months last year and I hated it. The apartment itself was ok (although some of my neighbors had problems with bugs, leaky roofs, etc…) but in the 6 months I was there (2 x 3 month leases) the complex was ready to raise the rent after each lease was up and the second hike would have passed my mortgage payment. Add to this the occasional “inspection” and having to wait a few days to get my water heater fixed and I have zero love for apartment living.

              Personally I wouldn’t buy anything that made me subject to a HOA but renting a place to live is a fair bit more restrictive than buying something that’s subject to a HOA. Unless you’re living in a total dump, your lease and your property manager will determine what you and everyone around you does so that the place doesn’t turn into a dump.

              • crazedhare says:

                Did you really just argue that you didn’t like your last apartment so therefore I would be better off under an HOA?

                When renting, I am living in someone else’s property – of COURSE they have the ultimate decision on its appearance and disposition. Why on earth would I pay for the privilege of owning a property, which should give me that right, but surrender some of those rights to an HOA? Sounds like the risks and financial responsibilities of ownership, with fewer of the rights. Forget it!

                • c!tizen says:

                  because you don’t understand the value an HOA brings to your home. They are there to make sure that you don’t ruin your house and drive down my property value or vice-versa. The rules (for most HOAs) are fair and tasteful. I don’t want to look at your rainbow colored roof anymore than you want to look at my busted truck on blocks on my lawn.

                  • crazedhare says:

                    Oh gosh, you’ve never made having property rights taken away for my own good sound so attractive. But still, I think I’m going to have to turn it down. Just like I don’t let the company that sold me my car tell me what kind of bumper stickers to put on it.

                    • c!tizen says:

                      No, but if you park your car and it’s bumper stickers next to mine it doesn’t affect my car’s value. Nor does your car drop in value if I park my rust bucket with a hanger for a door handle and 20″ spinners next to yours. On top of that, you have cops that tell you how fast you can drive your car, where you can and can’t park your car, what side of the road you have to drive your car on, how low your car is to the ground, what types of lights you can have on it, they even tell you how much emission your car is allowed to give off. Doesn’t matter thought because it’s a totally different scenario.

                      HOAs are supposed to be there to protect your home value, hence the investment you’ve made in that home. Yeah, some of them get carried away, but that’s life, there are always those who abuse authority.

                    • crazedhare says:

                      I see that as a GREAT argument AGAINST home ownership – you can buy an investment, it potentially drops value based on what others do, in order to avoid that risk your only good option is surrendering some of the very property rights you paid for. That is exactly how I see it, too. A racket.

                      And I agree that driving laws are irrelevant, so I am not sure why you brought them up. Laws also enforce what you can and can’t do with your real property (no brothels, meth labs, etc.), how you can sell it, and so forth. No distinction there.

            • c!tizen says:

              Here’s one for your calculator… the interest you pay on your house, and even some of the property taxes you pay are tax deductible, which part of your rent can you deduct? There are too many factors and variables for that calculator to do anything but give vague off hand estimates as to what might be your financial gain in x amount of years.

              And don’t kid yourself, when you rent you do pay property taxes, hell… you pay a mortgage, just not yours.

              • crazedhare says:

                They are tax deductible to an extent, and said deduction is I believe lost with appliction of the AMT – something that is really a very real fear for my family.

                Also, 25% of my rent is tax deductible since I maintain a home office within the rules for that deduction. Also, subject to the – is it currently 7% or 10%? – rule and application of the AMT, of course.

                SHOCKINGLY, when I said I had done my homework on this and run the numbers I had….done my homework and run the numbers.

                • c!tizen says:

                  Those taxes can be exercised through deduction of medical bills and investment holdings as well, it’s not tied to home ownership exclusively. Even then the heaviest hit are those who took out equity loans and are deducting the interest payments, it has nothing to do with the interest you pay on your principle loan, which is still deductible.

                  That 25% would still work for a home office, you may even get more depending on how much of the house you use for the business, but that depends on the business you run.

                  In the end it’s “to each his/her own”, not to mention where you buy/rent. I wish you luck and good fortune in whatever you do.

    • crazedhare says:

      Just did the calculator again – getting 18 years right now. In 18 years, I can earn an annual savings of $199 in the 19th year. My rent did go up by about $15/month since I last ran it. The horror….

    • backinpgh says:

      Couldn’t have said it better myself.

    • FatLynn says:

      You know, if you want to make a convincing financial argument, it’s generally not best to start off with “mommy and daddy will pay my bills for me”.

    • Loias supports harsher punishments against corporations says:

      That’s a moronic view of the situation. Buy a condo/townhome. The HOA takes care of a lot of what you mentioned, you get more freedom from an HOA than you do a rental agreement if you do your research, and at least a portion of the payment to your home build equity.

    • Me - now with more humidity says:

      Can you get zombie outbreak riders for rental insurance? I better call my agent.

    • castlecraver says:

      Agree completely. I rent currently because I can’t afford the property taxes in my area, and the time and money required for repair and upkeep. It’s worked out alright, and I also appreciate the freedom to easily uproot if needed.

    • Warren - aka The Piddler on the Roof says:

      Which is exactly how I feel. Owned a house (or rather, I was owned BY a house) from 1996 til 2000. Put a lot of time and money into it and was lucky to break even. I rent now, month to month, and I’m enjoying the same freedoms bunnymare mentioned. If I need to pack up and go, I just give my landlord a month’s notice and walk away. That’s worth a LOT to me in this economic environment.

      • crazedhare says:

        Same here. We are a one income family (mine), and should something happen to my job….or should I change my mind about working long hours (including lots of air travel, now with extra groping)…etc. Well, then, with a month or so of notice we can walk away.

        And could the landlord walk away from us? Yeah, but in a world where you can’t avoid risks and have to take on some kind, the risk that the landlord wants to end the gravy train of my consistently on-time rent payments is the less foreboding one to bear.

        • c!tizen says:

          Where are you guys getting this “I give a months notice and walk away?”. Are you paying month to month? You have to enter a lease contract which you have to buy out if you want to leave early, or you get sued. Try getting another apartment with that on your rental history and you’ll be paying way more to cover the cost of the risk the new landlord is taking having you as a tenant.

          Oh, wait… you can just up and move when you want to right? Homeowners can do the same, only they can rent out their property to people like you who will in turn pay their mortgage and property taxes for them. But what about maintenance? Yep, expensive, but if taken care of correctly it’s a minimum expense with occasional large purchases required, everything else is covered by insurance.

          Owning a home isn’t easy, it’s not for lazy people, it’s not for everyone, but you guys seem to have a hard-on for anyone that chooses to own land and a home, why? You’ve deemed it’s not for you, sweet, maybe I’m just better at managing and maintaining my resources than you are, or maybe I see value where you don’t. The bottom line is my mortgage will eventually be paid off, yeah, I’ll still have to pay property taxes, but it’ll be far less than you’re paying when you’re 60 years old and still handing over a rent check three times what I’m paying. Not to mention it’s not so easy to just “up and move” when you get to be that age. Why do you guys hate on homeowners so much?

          • crazedhare says:

            Yes, I negotiated a month-to-month after an initial one year contract. It’s not really all that hard. I have had to break leases in the past – and yet my most recent landlord prior to current rated me an ‘A+’ tenant. It’s a negotiation, you determine what the landlord wants to end the contract (usually just 2 months of notice) and do it, and you’re done. And personally, I want to be a landlord to others even LESS than I want to be a homeowner in the first place – honestly, you might as well have just suggested I cut off my feet to save the cost of shoes.

            Who’s talking hate? You’re the one calling people who’d rather spend their time enjoying life than mowing a lawn “lazy”, or suggesting that those who don’t want to take on an investment that will lose for the first two decades at least, somehow less intelligent than you.

            I really do hope you are better at managing your own needs and resources than I would be, I certainly wouldn’t expect you to be any good at managing mine! In fact, you’d rather suck – since you’d mismanage from the start by buying me into a long term investment that doesn’t mesh with my lifestyle needs and so forth.

            • c!tizen says:

              I said owning a home isn’t for lazy people, because it’s not, I didn’t say anything about being too lazy to mow your lawn, but I guess twisting my words works in your favor so I see where you’re going with that. And if mowing your lawn is taking too much time away from you enjoying your life then you shouldn’t be on the internet replying to posts, you should be out enjoying life. In fact, you just wasted more precious time reading my reply, and god forbid you waste even more of it replying. Seriously, how big is your lawn? Or how small is your lawnmower? What kind of argument is that?

              And really? Where did I imply that ” those who don’t want to take on an investment that will lose for the first two decades at least, somehow less intelligent than you.” When I said maybe I see value where you don’t? Anything else you’d like to twist around to improve your arguement? If any of that hundred-thousand dollars of student loans went to a debate class, I’d demand a refund.

              And to be clear here, you’re basing your “investment that will lose for the first two decades at least” off of an online calculator… really? There are so many variables that it doesn’t account for, yet your’re clinging to it like a programing manual. You have no idea the cost of actually owning a home, nor the benifits or returns it provides. I’ve been where you are, I’ve rented, and yeah, it works for a while, but eventually that game gets old, as do you, and pretty soon you look back and realize that you’ve paid a mortgage 5 times over and all you have to show for it is an escape plan for zombie attacks.

              I can’t believe your parents offered to buy you a house, twice. I guess that makes them just as sucky at managing their finances as I am too, huh? But then again, they can afford to buy their child a house so maybe they’re on to something.

              • crazedhare says:

                Dude, you are way WAY too invested in where and under what legal structure people you don’t know choose to live. You need to chill out.

                I think I have outlined pretty clearly the kinds of considerations I’ve made – actual property prices where I live, actual taxes where I live, likelihood of my staying put for a long time, risk tolerance deductions I have now versus those I might keep with a house, job stability, etc. I can’t imagine on what grounds you think a multifaceted consideration that is the result of several years discussion, is programmed by one resource.

                Beyond that, I don’t know what to tell you, other than that your attempt to belittle and shame me for a carefully-considered decision that many economists support/recommend is really very silly.

                • c!tizen says:

                  I’m not trying to belittle or shame you, I’m not the one taking what you said and twisting it into a generalization. You rent, it works for you, that’s cool. I love how you take issue to me making comments about you as a renter, but when you speak of homeowners in the terms of, here, let me quote your unprovoked description “I will happily cut a check on the first of every month to allow some other sucker to deal with that though.” it carries no weight or warrants no response?

                  How about “And lest you tell me it’s a good investment, it’s not”. So when you crunched all those numbers you took everywhere and everything into account, right? You make these generalized statements and then call people out when they do the same to you. Lets be honest, I don’t know you or how you live, where you live, what you do, what you like (aside from the zombie thing which we can grow a mutual agreement on), but you’re making statements as general as I am (my point) and then trying to defend your stance by calling out it’s generalization and then twisting my words around.

                  I will give you this though, you helped me kill an otherwise boring part of my day, so thank you for the conversation and banter.

                  • crazedhare says:

                    No, I didn’t take everywhere and everything into account. The discussion-triggering question was “why does it make more economic sense for YOU to do what YOU’RE doing?” (emphasis mine). As much as you want to try to cast it as such, this isn’t a debate. There’s no need to win. You really do need to let that go.

                    And I’m sorry you feel I am twisting your words. If you don’t want to be interpreted as a jerk, don’t act like one.

                    • c!tizen says:

                      I don’t “feel” you’re twisting my words, the proof is in the thread… you ARE twisting my words. And I’ll go ahead and step away now since we’ve exhausted your ability to converse like an adult and entered the realm of name calling.

                    • crazedhare says:

                      Again, I’m sorry you feel that way. Internet discussion may not be a good forum for you, if you are uncomfortable with people reading and interpreting your words. Call it a day!

                    • DH405 says:

                      I’m just gonna step in here and say that you’ve been rather belligerent throughout this thread. Maybe you’ve had a bad day or something, but I’d suggest waiting until tomorrow and then re-reading your comments to see how they come across.

    • JulesNoctambule says:

      Do Mommy and Daddy pay your rent, too, or just offer to buy you houses?

      • crazedhare says:

        Just offer to buy a house :)

        Not the hundred thousand in student loans, the medical bills from my child’s fatal cancer, the car payment, or anything else. And I still won’t walk into the home ownership trap. That is…ahem…the point.

        Bitter much, are ya?

  6. Bativac says:

    It makes sense for me because the mortgage is less than I was paying in rent for twice the space in the same general area. I had to put some savings down but, in my mind, it was worth it for the ability to change my surroundings to suit my tastes and needs (vs. having to ask a landlord if I’m allowed to paint, and being told “no”).

    Plus, when it comes down to it, my wife and I wanted to buy a home, which is really the only justification we needed.

    • Lethe says:

      No one ever seems to mention condos when talking about the rent vs own dilemma. Two years ago I purchased a townhouse-style condo. My mortgage is only about $500 a month (on a 20 year mortgage), and the condo fees are less than $200. Water is included, so my only utility is hydro. My monthly housing expenses come to around $800 a month, even when factoring in property taxes. My old 2-bedroom apartment was $850 a month, and now I have more than twice as much room, and the bonus is that all major renovations will be covered by the condo corp.

  7. TonyK says:

    For us it is an issue of privacy, safety (read fire prevention from smokers – we are non-smokers) and not disturbing our neighbors (my wife likes music at realistic volume).

    All that other stuff I could care less about. We’ve not been able to itemize for years so the interest is just dead weight to us. Same thing with taxes.

    But being able to do what we want, within zoning limitations of course, matters more than asset growth.

    • obits3 says:

      The fire thing is an issue that I have thought about. If your neighbor’s apartment catches fire, then you are screwed; however, if your neighbor’s house catches fire, then there is a good chance that your house is safe (unless it becomes an explosion).

    • TouchMyMonkey says:

      Well, we just re-fied to 4.25 (and current re-fis are down further to 3.5% – damn, we’re pissed!) for 15 years. Our mortgage payment went up by maybe $30/month, but we trimmed nearly seven years from the term. So there is a possibility that we might not itemize next year.

      Since Upstate NY didn’t really participate in the shenanigans that caused the housing bubble, our property values stayed more or less stable.

      Property taxes are a problem, but do you renters really believe you don’t pay them? If your landlord pays property tax, so do you, if only indirectly.

      Finally, unless you live in New York City or someplace, what’s available for rent is usually not in the best neighborhood, to say the least, or of the best quality. I’ve lived in enough apartments to know that it’s not really where you want to be for the rest of your life. $800 spent on rent is definitely not as good a deal in most locations than $800 or even $1000 spent on mortgage payments. It’s just not.

      • Verucalise (Est.February2008) says:

        Our property stayed relatively stable as well (upstate NYer too) which is great because we were only into our mortgage term 1.5 years before the bubble burst. With what improvements we have done, our house is worth $10K more than it was when we bought it. We never felt the need to refinance- our interest is locked at 5.125%, although I’d love to refi for the 3.5% and do 20 years to pay this puppy off quicker.

      • Me - now with more humidity says:

        Of course some property taxes are passed through via rent. But if I’m in a 2-year lease, and the owners’ taxes go up 15%, my rent doesn’t.

      • BurtReynolds says:

        I think we’d all own if we lived in Upstate NY. Whenever I go home to visit my parents I see a sign that says “new homes from the $170s” and start having dreams about what I could afford there for the same price I pay where I currently live.

        As a former Upstater, before you complain about property taxes, consider the value you are being taxed on. In Northern VA, we have a lower tax rate, but my house in Upstate NY would probably be worth substantially less. Overall cost of living in Upstate NY still isn’t that bad when you look at the big picture. The problem of course is finding stable work outside of teaching and government jobs. If I could have found a good job there out of college, I’d happily still live there.

    • pecan 3.14159265 says:

      Privacy, security, and safety are some of the reasons we chose the place we’re living in now. It’s all controlled-access and I know who my neighbors are. Delivery people aren’t allowed into the building, and I’ve never felt unsafe.

      When I rented a townhouse, though, I was checking every door at night. Something about having a garage door, a front door, and a sliding glass door to the patio was just unnerving.

  8. AustinTXProgrammer says:

    My wife and I plan to stay put for some time. We also want the freedom to change things in the house so we own.

    • howie_in_az says:

      Same here, plus we have the added benefit of owning the home in ~16 years through a combination of a refi and paying extra every month. Since we’ll be used to paying $x per month for the house, that money can go directly into our savings account for ~14 years (or, more realistically, go towards our kids’ college education).

    • pecan 3.14159265 says:

      We plan to stay put, too, but what we plan and what happens aren’t always the same thing :) That’s the main reason we’re not jumping into home ownership.

  9. Tim says:

    Household != house. A household is the people living within a house.

  10. eccsame says:

    I think owning a house is a great investment, a way to build equity, and renting is throwing money away.

    Or, at least that’s what I heard in 2007.

    • obits3 says:

      Here is the problem with the “Our house is an investment” idea. Let’s say that you buy house “A” for $100,000 (with cash). After a year of 3% inflation, your house is now worth $103,000.

      If you sell your house for $103,000, can you go get a similar house and pocket the $3,000? NO!

      Why? Because other similar houses have ALSO followed the inflation. Thus, a house is only an investment if you have at least 2 houses at the same time. With 2 houses, you could sell high in the good times and buy low in the bad times. With only 1 house, that house is not an investment.

      • TuxthePenguin says:

        Your argument has one major flaw – most people don’t try to flip a house like that.

        Okay, most SANE people don’t try to flip a house like that.

        What tends to happen is that someone buys a three-bedroom house for $100k. They wait ten years (say they have a second or third child they weren’t expecting, so they need to move up). At 3% inflation, their house is now worth $134k. Assuming 10% down at 5.15%, they have equity equal to $60.8k. Lets say there are $10k in moving/sales/etc expenses – they have $50k after selling their house.

        Ten years ago a four-bedroom house would have cost $130k. It now costs $174k. But they can take all they got from selling their first house and put it as a downpayment on the new house – they now only finance $124k – cheaper than if they had bought it initially.

        Now, there are some simplicities here – you assume after ten years they can afford the bigger place (they should, its only $200 a month more) – if they couldn’t they wouldn’t sell. You also assume that the bigger house doesn’t appreciate faster or the smaller house slower than inflation. But that’s what they mean as a house as an investment – its really just a hedge against inflation.

        • obits3 says:

          If I modify my simple example, let’s add in the bank interest. If the interest rate you pay is 5% and the inflation rate is 3% then you are losing 2% every year. Of course it is not that simple.

          I’ll try to compair a local townhouse I know to a used house I know about:

          Townhouse: $740/mo
          House (with $100,000 30 yr mortgage rates at 4.3%): $494.87/mo
          Add in property taxes, maintenance, insurance: $5,500/yr
          New house monthly: 953.20/mo

          Net extra cash per year renting: $2,558.4
          Over ten years (I think the property taxes and maintenance vs rent inflation will be a wash): $25,584
          If invested in T-Bills at an average of 3%/year: $29,792.87

          3% inflation increase of house over ten years: +$34,391.64

          Less commission on house sale (let’s say 5%): $(6,719.58)

          New increase in value: $27,672.06

          As you can see, I think that it is a wash, but the house has considerably more risk.

          • TuxthePenguin says:

            Once you start adding one factor, it gets really complicated.

            Are you including the cost of moving over the course of those ten years? The lost portion (or all) of the deposits?

            The other reason many buy a house is it is FORCED investing. Sure, it might be swell that you could invest all that, but for most people, spending tends rise when there is more free cash.

            • obits3 says:

              “… it gets really complicated” very true =)

              For rent there are moving cost; for homeownership there are property disaster deductibles over ten years. Also, a house can limit your employment opportunities. In the end, I think that a house is a great deal if you can pay for it straight cash and don’t need to move.

            • thedarkerside.to says:

              The other reason many buy a house is it is FORCED investing. Sure, it might be swell that you could invest all that, but for most people, spending tends rise when there is more free cash.

              Even IF your spending rises with more disposable cash instead of putting it into an investment (and that’s easy: Set up an auto transfer to your investment account every paycheque), it will still be easier to, say, stop buying that Maserati when you lose your job than it is to sell your house and find something cheaper.

              Houses are extremely illiquid, as long as the market goes up the gamble can pay of, but once it’s on a downward trajectory you’re stuck with it and better hope that either the market recovers or you can keep carrying the mortgage (can we stop calling it a house? You don’t own it, you own a mortgage plus all the liabilities that go with owning a house).

      • thedarkerside.to says:

        It’s worse than that.

        - You committed a downpayment, this is money that could have been invested otherwise.
        - You paid interest on the principal, so that has to get off of your “profit”.
        - You had to pay closing costs, taxes etc.

        I all likelihood, unless it’s a bull market, you lose money.

        I really wish people would understand percentages and simple addition / subtraction. It’s really not that hard to realize that at best your house is a “flat investment”.

  11. Me - now with more humidity says:

    I’ve owned, but right now I enjoy renting. Rent is less than house payment would be. At this price range, the tax deduction for mortgage interest wouldn’t offset the standard deduction. Repairs come with a call to the owner. I can skip over news stories about the our screwy property tax setup (they went up 10-15 percent last month) and homeowner’s insurance (my renters’ insurance is $22/month). And if we want to or need to move for career reasons, we can.

    We’re watching the market to decide about jumping back in, but for now, it’s all good.

  12. Blueskylaw says:

    This is why rentals are going up. The foreclosure mess and the weak economy will continue to drive home sales down until everything stabilizes and people feel confident in their job and earnings situation again.

  13. pecan 3.14159265 says:

    We rent for several reasons. One, we don’t have the tens of thousands of dollars it takes to make a down payment. We would have to put all of our savings into a down payment, and that’s not a risk we’re willing to take just to own something.

    We’re also wary of jumping into something so permanent when our experience tells us this can all change at a moment. I had a job, then I lost it. I got another job, but it was farther away than the old job. After months of fighting an hour and a half of rush hour traffic for a commute that should’ve taken 40 minutes at the most, we decided to move. We wouldn’t be able to do that with a mortgage. I have friends who are changing jobs now and they’re frustrated because they have a mortgage and can’t sell their house right now and move. I don’t want that stress; it’s one of the things I can control, so why not just keep renting?

  14. ElleAnn says:

    I seriously considered buying a house in Phoenix in 2006. I made approximately the median income for the city, and as I started looking for a home, I realized that I was priced out of the market. I would have been lucky to find a 1 bedroom condo for the monthly payment I felt that I could afford and all of my savings would have gone to a 5% downpayment. I left Phoenix, went to graduate school full time for a couple of years, got married, and now my husband and I have a 20% downpayment plus a 6-month emergency fund saved and we’re planning to buy a house this summer. We would buy this winter, but we just signed a year lease because our old landlord was in foreclosure and stopped paying the gas bill and we had to move with short notice- which really sucked.

  15. Nigerian prince looking for business partner says:

    I’ve rented and I’ve owned and ultimately it comes down to the housing costs in a given area and how long I plan on being somewhere.

    The reasons I bought our current house:

    1) Owning is significantly cheaper than renting where I live. I pay $600/month for my mortgage, insurance, and taxes vs. at least $1,200/month to rent.

    2) I moved around a lot as a child (about once a year) and want to do whatever possible to put down roots.

    3) I love old houses and all of the repairs that come with them.

    4) I like being responsible for my own repairs and putting them off is my own decision. I’ve never rented anywhere where the landlord was timely in fixing problems or did a decent job with them.

    • FatLynn says:

      I’m in the same boat. I love doing fix-it stuff and upgrades (ceiling fans FTW!). The people who argue they’d rather just call the landlord must have far better landlords than I ever did.

      • jessjj347 says:

        Sometimes, you can do work on an apartment if you talk to the landlord. You can either do it yourself or hire someone. If you do it yourself, it saves them money, or if you hire someone it saves them time from managing the process. Basically, you either have to have a good relationship with the landlord, have earned their trust, have to prove you are good at fixing things up (maybe it’s your profession?), or have to be good at negotiating :)

        • junip says:

          Or, when your landlord hires a property management company, all reason goes out the window and you have to start looking at housing codes.

    • econobiker says:

      And here’s to hoping that you keep the same job in the same place for the next 30 years.

      • Nigerian prince looking for business partner says:

        Where did you get 30 years from?

        I’m about 15 years away from paying it off in full. I owe around $50k but even if I sold it for a massive loss, I’d still make about $40k in the process.

  16. corkdork says:

    It made sense for us to buy a house in May — our (rented) condo was being foreclosed on, so we needed someplace to live, and it turned out that for $25 more than what we were paying for a 2/2, 4th floor condo, we could get a 3/2 house with a pool about 3 miles away. My thought is that, even if the values still deteriorate (according to Trulia, we’ve lost about 6% of our home’s value since we bought it), it’s a place to live where I don’t have to ask permission to paint or remodel a closet into a wine cellar.

  17. MedicSteve says:

    I make out a little owning than renting. The mortgage (+escrow for insurance & property taxes) for my 3 bedroom home is what I would pay as rent for a ‘run-down’ 2-bedroom house.

    The benefits more than make up for the loss of the option of just ‘packing up and going’. I’ve got a gorgeous golden retriever and the wife has her annoying cat (Most landlords in my area strictly forbid pets). If the wife or I dislike/get bored with a color of a room, we can just grab a bucket and paint. I don’t have to get permission if I want to make any modifications to rooms/carpenting/etc.. Are those damn bushes bugging me? I can just go yank them out (Bad example, “her majesty” loves those bushes *sigh*)

    My monthly housing costs are WELL within my means. So if one of us loses our job, we would still be okay (would require a little creative budgeting, but wouldn’t be fearing foreclosure). Plus we have a little put back for emergencies and routine up-keep.

    Of course owning vs. renting is very area dependent. We just happen to live in a rural area AND lucked into mortgage where it was actually cheaper to own than rent. I know it wouldn’t have worked out this way if we lived in or around a larger city.

  18. u1itn0w2day says:

    This statistic simply shows how far out of whack the house prices got. It also shows the important rule of thumb that a mortgage should be no more than 1/3-1/4 of your yearly salary. The buyers and bankers are now forced to think about a home sale which did not happen the first half of the decade.

  19. Neela says:

    We’re seriously thinking of buying. The mortgage payments would be less than we’re paying in rent, and we don’t have to deal with a jerk of a landlord. 1 year later? Our windows are STILL not fixed. The money we’d save could easily go into a savings to fix anything that might break.

    Oh, and before someone suggests trying to find another rental, we keep trying. There is nothing to rent in this area unless you want another (very undesirable and far too expensive) state, or “income based” rentals.

  20. tonberry says:

    i see a lot of ” it was cheaper to buy then to rent” where the heck do you people live???? my wife and i just purchased our home a couple months ago, our rent was $825, and the mortgage payment with taxes is 1287, for only about 200 more sq ft. but we do now have a full basement, and attic. we live in the northeast, in a suburb of Philly.

    • Nigerian prince looking for business partner says:

      There are many places in the US where you can buy a house for around $100,000. Even in your area (I’m assuming Montgomery County?), buying a row house in Norristown or Mt. Airy can be had for significantly less than Lansdale or North Wales. Not that I would want to go back but I lived in South Philly for several years and houses there were fairly cheap.

      When renting is drastically more extensive than buying, it’s been my experience that it’s cause by some other factor causing a distortion in the market. If you live in a university town, there’s usually a lot of competition for rental units and it drives up costs. In poorer areas, there’s typically a great deal of subsidized housing which also drives up costs, and you get a lot of very expensive units which are very undesirable or in undesirable neighborhoods. It also results in a huge premium that must be paid to get a decent rental.

      I used to live in DC and paid about $2,500/month in rent. About 10 years ago, I took a very big pay cut and moved to the midwest where my mortgage/insurance/taxes run $600/month.

      • tonberry says:

        bucks county actually. the house was also a short sale that we got for about $90,000 less than what was owed on it

        • crazedhare says:

          Same here – Central bucks.

          I think those who are crowing about how their rent was $1,200 and mortgage is $400 moved from somewhere pleasant to rural Florida or something. I looked at houses here in CB for awhile, and it’s about $300k to get a tiny 3 bed cape built in the 40s that needs a lot of work. And then property taxes on top of that – forget it! And as I would rather stay in beautiful Bucks than move to some hellhole, I’ll be renting for the rest of my life if I can manage it.

          I mean, look at the commenter above – I would by far rather and will have a higher quality of life if I rent in BC than buy in freaking Norristown. Mt. Airy and those neighborhoods are certainly something I am considering, but they are simply not comparable to living in central Bucks County.

  21. brianw76 says:

    We are building a new house, but due to the market conditions decided to refinance our old house and rent it out instead of sell it. After the refi we’ll be making an extra $375+ a month over the cost of the mortgage through renting (that’s including P&I, insurance, taxes, etc..) and since we have a signed contract for a 4 year lease that allows us to keep building up more equity until hopefully the market recovers and we can sell at full value.

    So crazy to us that we can make so much more renting our properly instead of selling it.

  22. lettucefactory says:

    Our jobs are in Northern Virginia, one of the most affluent and expensive places to live in the country. For us, buying is pretty much out of the question – to get a monthly payment we could afford, we would have to either move very far from work (and with the traffic around here, that means a 90 minute drive each way) or buy a very small condo closer to work. Both choices are impractical, because we have two small children and would like to, I don’t know, see them more than 15 minutes a day and maybe offer them a bedroom to sleep in.

    Plus, we don’t have thousands to hand over as a downpayment. We just don’t.

    I kind of hate renting. I hate knowing that I’m living at the whim of my landlord (she can send us packing at the end of any lease term) and relying on her to fix problems (which she is reluctant to do) and knowing that my payment will go up and up every year, as rents do in expensive areas like this, unless we move. And I’m so tired of moving.

    But with our monthly rent check, we live in a neighborhood close to work with excellent schools, and the area is also very walkable – not the “scorched earth” look of some of the less expensive, far-flung suburbs. The house we rent is small by most standards, but way more comfortable for a family than the one-bedroom condo we’d get in our neighborhood with a similar monthly mortgage payment.

    Renting is logical for our situation.

    But I still wish a fairy would come down from the sky and grant us a downpayment :)

    • pecan 3.14159265 says:

      I don’t know your budget, but have you considered Falls Church and Vienna? There are some fantastic homes out there that are much, much less expensive than other areas, and they’re established neighborhoods with great schools. I have friends who live in Vienna and they love it there.

  23. katarzyna says:

    Owning a semi-detached condo has worked out well for me. After two years, I converted my 30 year mortgage into a 15 year mortgage. It’s now been paid off for several years, and I’m able to enjoy a lot of extra money. With the extra money I saved in the first year, I hired a general contractor to finish my basement, giving me an extra 1000 square feet of living space. I don’t cut my grass or handle external repairs. I do have an association fee, but it’s very reasonable, and less than it would be for me to maintain a lawn mower, etc.

    If I do need to move quickly, I could sell the place for 10% less than market value, and still end up with a decent amount of money in my pocket, even with the market as depressed as it is. I figure my place is worth ~10-20% more than what I paid for it 20 years ago. (I could be wrong, but, even if it’s worth less than I initally paid for it, I’d still be ahead of the game.)

    Owning has worked out well for me.

  24. keepher says:

    What this article tells me is that with all the shenanigans of the financial sector where folks who did not qualify for a mortgage or the McMansion did with the help of some creative numbers. Now the cat is out of the bag and the home ownership numbers are now more in line with reality.

    I am purposely not addressing those that are losing homes due to unemployment, that is a different set of circumstances entirely.

  25. Anonymously says:

    Manufactured Home:

    I own the 900sq ft home outright and lease the land for less than property tax on an average house would cost me.

    The biggest downside is the constant threat of being evicted when the property owner decides to sell the land (probably to a shale drilling company).

  26. CrankyOwl says:

    I own a condo, but with what I’m paying for mortgage, property taxes & HOA fees (which are going up 20% next year), I could rent a fabulous apartment within walking distance to work. Property taxes keep going up every year even though the value of the condo has gone down, (thanks to a referendum voters passed in Oregon years ago that divorced property values from taxes). I’m going to try & sell it next year but doubt I’ll be able to get enough to even pay off the loan. Meh.

  27. Sian says:

    Going from $2000/month rent to $400/month mortgage for more sqft.

    Sure, I had to move to Florida…

  28. Harry Manback says:

    I am paying significantly more now than when I was renting a bedroom from a guy ($600 + split utilities is now $1500 + all utilities) but I couldn’t be happier. I have a 2 car garage (which is impossible to find in a place for rent that’s lower than $1500, a very private backyard with deck and hot tub, and a finished basement. I can host poker games, play the drums or guitar as loud as I want, and I can be naked whenever and wherever I want. When I rented before, I rented a very small 2 bedroom house with 1.5 parking spots, no basement, no garage, and 4 close neighbors for $950 a month plus ALL utilities. Sure, I have to fix whatever breaks, but the freedom to do whatever I want with the house, along with a garage for my 2 motorcycles and my car (I live in VT, that’s a big deal), more than makes up for the difference. If money gets tight I can rent out the other bedroom in the house.

    • MrEvil says:

      Don’t blame you there for wanting a garage. When I lived up in Amarillo and my garage was full of shit it took me 30 minutes to clean snow off my car so I could drive anywhere in the winter, and that was with just an inch or two. I can imagine when your snowfall is measured in feet it takes considerably longer to clean your car off.

  29. econobiker says:

    House owner- permanent difficult to move. Investment but hope your employer stays solvent. Worry about getting a new employer to fund a sale.

    House renter- mobile, easy to move. No investment but no care about changing job locations.

  30. Cantras says:

    My brother got a fixer-up duplex with the home-buyer credit. Now it’s fixed up, he lives in one half, and the renter in the other half pays some 80% of the mortgage.
    He turned 21 this past spring.

  31. B says:

    And just like every other trend, I’m 10 years behind the times. I bought my house last year.

  32. momtimestwo says:

    We didn’t buy a house for economic reasons, we bought one because this is where we live and wanted to raise our kids. It’s a place where our kids can say “I grew up there”. It’s our home, our place to grow old and all that stuff. Our home to pass down to our kids. Or more likely we will have to sell when our kids want to put us in an old folks home.

  33. c!tizen says:

    “tyranny of a HOA”

    HAHAHAHAHA, good one. A couple of stories about some BS HOAs and all of the sudden they’re all tyrannical? I guess for the case of your one-sided comment yeah, that works, but the reality is much different. The bottom line is that home ownership isn’t for lazy people or people with too little time to take care of things.

    Some people want a place to raise their kids, a home to leave their family. Some want to own a piece of land and to build something they love. Some people like to move a lot and have no ties. Some don’t have the financial means to buy so they rent.

    I certainly hope you all have some kind of substantial pension or supplemental income when you retire, cause rent may be a hell of a lot more expensive when you get older. And one last thing to think about, no matter if you rent or own, you’re paying someone’s mortgage… might as well be your own at some point.

  34. EBounding says:

    I’m renting a house right now. I don’t plan on buying until it makes personal finance sense to own. I also have no idea if I’ll be in the same area in the next 5-7 years.

    I could purchase a house and have a similar monthly payment even after factoring in interest, taxes, maintenance and insurance. But then I would have to tie up a big chunk of my savings into the house for the down payment. Plus I wouldn’t have any mobility.

    House prices in my area seem relatively stable now, but if interest rates go up, house prices will continue to take a beating unless income and employment rises significantly in my area.

  35. asok says:

    I am buying a house because Warren Buffet tells me to do what everyone else isn’t.

  36. sweetgreenthing says:

    We tried to buy. We were pre-approved for a little more than we actually intended to use, had a 20% downpayment, and put offers on 5 houses in our area. Investors paying cash outbid us every time, and now all 5 of those houses are being rented for double the mortgage.
    So we are renting and saving.

  37. Kate says:

    Most people aren’t allowed free ownership of whatever pets they want in rentals, so that’s a factor. I personally can’t stand to live somewhere where I can’t alter things how I want, but I can see if housing prices are going down, it seems silly to buy unless you have to.

  38. thedarkerside.to says:

    Let’s be honest here. Most people did not own their houses (otherwise they’d be still in them) they owned a mortgage.

    If people would understand that little difference it would have never gone as far as it did.

    Next up, my neck of the woods. You liked Vancouver during the Olympics? Come back to the bonfire of real estate, kindling already, starting in earnest in the next few months.

    Enjoy the show, oh, and bring popcorn.

  39. NumberSix says:

    It makes sense because I get to own the place where I freaking live. Economics be damned.

    Well, that and I bulit the place and am right side up on my mortgage. Even if I wasn’t it wouldn’t matter because I never intend to sell.

  40. Awesome McAwesomeness says:

    For us, it’s mowing, landscaping, upkeep, etc… that keeps us from buying again. Houses get old. They get outdated. They need new things like a/c’s, heaters/furnaces, fences, roofs, insulation, electrical wiring, plumbing, appliances, get foundation issues, termites, etc…. That costs time, effort, and money. I feel like all we did was spend money when we owned a house.

    We bought a nice house that was 25 years old (we sold it). At retirement, the house would have been 65 years old. We would have had to replace everything two or three times over, the neighborhood would have been in decline, and we would be elderly people trying to care for a 65 year-old house. No thanks.

    We’ve got the means to keep living in nice apartments for the rest of our lives. I have no problem with that. We know what we will be spending every month. We get no surprises. We have someone to come fix what’s broken whenever we need. We can move somewhere else if we get sick of it here or want to live somewhere newer or nicer. It works for us.

  41. Dave on bass says:

    I’d love to move closer to work, but since the bottom dropped out on prices, I am upside down on my home with no clear sign of recovery. It’d be probably about 20-25% cheaper for me to rent the exact same home I own, since the rent prices dropped with the purchase prices (but not as drastically, I think!). I like owning, though, as I’m not just throwing money down somebody else’s well… chipping away hoping to get back to an equity situation is a bit trying, though.

  42. ncbill says:

    You can fix a mortgage, but not total housing costs.

    Property taxes increase much faster than the rate of inflation.

    I grew up in a very nice, large (nearly 5000 sqft) house here in flyover country, in a low-cost part of the southern U.S.

    That house just sold for twice what mom sold it for 20 years ago.

    Property taxes went from $4,000/year to $15,000/year – nearly quadrupling over the same period.

    Want to own/can you afford to own that property in 20 years when taxes have quadrupled again? ($60,000/year!)

  43. zenpirate says:

    For me, it call came down to 7+ years of always dealing with tyrannical/psychotic landlords versus the hassle of owning my own place. Home ownership won, hands down, and I bought my first place last year. My mortgage + insurance + property taxes are less than most places I paid rent for, and I’ll take the periodic headache of paying a plumber or electrician to fix something rather than dealing with a landlord who just doesn’t care and takes forever to get anything fixed. I’m sure anyone who has ever rented has landlord horror stories to tell (I know I do). I understand why some people don’t want to buy a home, and it isn’t for anyone, but I’m glad I did it.