Before we get anyone too excited about buying a house though: depreciation, maintenance, repairs, taxes, and transaction costs are expenses not to be underestimated.
Buy a house for the lifestyle, not as an investment. A low-cost mutual fund is a way better place to save your money.
Most of that is already bundled in to rental prices, though. My coworker pays more in rent than I do for a 15 year mortgage, and it's not because his apartment is nicer than my house. Meanwhile, after 6 years I have around $80,000 of equity in my house, and he... doesn't. Obviously this various from region to region but the long term math usually works in favor of owning.
That said, if you do want to own, I would highly encourage learning to do some basic repairs on your own. You can patch up a lot of stuff with a few wrenches and a drill that would normally be hundreds of dollars to call someone for.
This is exactly my point. Rent includes expenses beyond what a mortgage covers, for example repairs. So it’s not right to compare just your mortgage to your friend’s rent.
You can save on repair costs if you learn to be handy. Which brings me back to: buy a house for the lifestyle.
If you want to be in a place a decade plus, and if it’s important that nobody can force you to move (very relevant for kids), if you are willing to learn a wide(!) variety of repair and maintenance tasks; buying a home is great.
But it’s nothing like renting. If you enjoy “I can walk away from this apartment to spend two months somewhere else and not worry about a thing” or “I don’t have to have $3,000 ready to go just in case the furnace breaks”, then don’t buy a house. You’ll be miserable.
The point I think you're missing is that part of the rent price is profit for the landlord. They don't rent out of the goodness of their hearts. So if you're renting you're paying some amount of money to make the landlord richer. If you buy, that money is making you richer.
Now as everyone has pointed out the math can get more complicated, and it's not as simple as saying the price difference between renting and mortgage is the profit you keep, but that extra money is real. And often times it means owning leaves you with more money later on. Hence, owning often is a worthwhile investment.
And the landlord is carrying the risk of losing money if housing prices crash.
True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way. Your options are give that money away, or invest it in a house. I feel pretty confident that the risk for a return below 0% is very low, so chances are high owning will be more profitable than renting.
"The world is a mess, and I just need to rule it" - Dr Horrible
You can always make a solution of actual cream and whatever milk substitute you use that ends up having enough volume and enough milk fat that it should work.
Assuming the milk substitutes still have sugars and proteins in them.
Iirc milk is just fat, sugar, and protein. Molecularly speaking
I don't think so. At least not from what I've seen. They are mainly fat, sugar, and protein, but they're different kinds that behave differently. Sometimes they substitute fine, other times not so much.
Yup, this.
Milk fat (an undefined mix of mostly saturated fats ), lactose, and whey/casein is chemically quite different from canola oil (unsaturated fat), oat starch derived sugar and oat protein.
We use oatmilk a lot and it's great for coffee, cereal, cold sauces (the oat sour cream) or for adding a smidgeon just before serving.
But if you want to cook a casserole or stew you'd better go with coconut oil or just a tomato base.
Edit: I did a case study 15 years ago at Uni together with a startup making oat-based yoghurt. We even got to taste it. It was horrible but 7 years later they improved it an it can be bought pretty much everywhere now over here. It's a really cool product from an engineering standpoint.
Less milk being bought, means less cows, means less pollution right?
We can all shift to oat milk!
Oat milk is a hard no for me. Vanilla almond is my go to daily table substitute (best cereal moisture there is, IMO), any more I only buy whole milk or cream when I bake or am looking to make a heavy bechamel. The way the proteins in every nut and soy milk I've tried denature leads to piss poor results and/or weird aftertastes.
BlackDragon480 on
No matter where you go...there you are. ~ Buckaroo Banzai
The more certain investors are that real estate will be profitable, the more theyll bake it into their cost projections. They arent renting out of the goodness of their hearts, but they also have to compete for renters and can't do much but sell or rent below profitability if thats how everyone else is pricing units.
All the small landlords around me barely break even, theyre all betting on appreciation to get them to a profitable exit and they increasingly cant raise rent because the bigger complexes have economies of scale.
Some luxury properties go empty instead of being rented but I think that is mostly a Vancouver/NYC/SF thing? Not the average unit, certainly.
The global milk market is $120billion, the non-dairy milk is $18billion, less than 10%
Walmart decided to make their own milk, so deans lost their biggest customer. Dean went from $43million in operating cash flow in 2018 to less than $3million in 2019. That's piss poor management, not a year end 2% decline in milk sales.
Yeah, they should have tried to compensate with an increase in whole milk sales.
Before we get anyone too excited about buying a house though: depreciation, maintenance, repairs, taxes, and transaction costs are expenses not to be underestimated.
Buy a house for the lifestyle, not as an investment. A low-cost mutual fund is a way better place to save your money.
Most of that is already bundled in to rental prices, though. My coworker pays more in rent than I do for a 15 year mortgage, and it's not because his apartment is nicer than my house. Meanwhile, after 6 years I have around $80,000 of equity in my house, and he... doesn't. Obviously this various from region to region but the long term math usually works in favor of owning.
That said, if you do want to own, I would highly encourage learning to do some basic repairs on your own. You can patch up a lot of stuff with a few wrenches and a drill that would normally be hundreds of dollars to call someone for.
This is exactly my point. Rent includes expenses beyond what a mortgage covers, for example repairs. So it’s not right to compare just your mortgage to your friend’s rent.
You can save on repair costs if you learn to be handy. Which brings me back to: buy a house for the lifestyle.
If you want to be in a place a decade plus, and if it’s important that nobody can force you to move (very relevant for kids), if you are willing to learn a wide(!) variety of repair and maintenance tasks; buying a home is great.
But it’s nothing like renting. If you enjoy “I can walk away from this apartment to spend two months somewhere else and not worry about a thing” or “I don’t have to have $3,000 ready to go just in case the furnace breaks”, then don’t buy a house. You’ll be miserable.
The point I think you're missing is that part of the rent price is profit for the landlord. They don't rent out of the goodness of their hearts. So if you're renting you're paying some amount of money to make the landlord richer. If you buy, that money is making you richer.
Now as everyone has pointed out the math can get more complicated, and it's not as simple as saying the price difference between renting and mortgage is the profit you keep, but that extra money is real. And often times it means owning leaves you with more money later on. Hence, owning often is a worthwhile investment.
And the landlord is carrying the risk of losing money if housing prices crash.
True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way. Your options are give that money away, or invest it in a house. I feel pretty confident that the risk for a return below 0% is very low, so chances are high owning will be more profitable than renting.
You are completely ignoring all the attendant costs associated with the purchase and sale of a home. Closing costs for a seller can reach up to 10% of the sale price. If you turn around and sell a house after just 2 years because your job shipped you across the country you will definitely lose money from purchasing a home instead of renting. Even without an '08 real estate collapse.
Before we get anyone too excited about buying a house though: depreciation, maintenance, repairs, taxes, and transaction costs are expenses not to be underestimated.
Buy a house for the lifestyle, not as an investment. A low-cost mutual fund is a way better place to save your money.
Most of that is already bundled in to rental prices, though. My coworker pays more in rent than I do for a 15 year mortgage, and it's not because his apartment is nicer than my house. Meanwhile, after 6 years I have around $80,000 of equity in my house, and he... doesn't. Obviously this various from region to region but the long term math usually works in favor of owning.
That said, if you do want to own, I would highly encourage learning to do some basic repairs on your own. You can patch up a lot of stuff with a few wrenches and a drill that would normally be hundreds of dollars to call someone for.
This is exactly my point. Rent includes expenses beyond what a mortgage covers, for example repairs. So it’s not right to compare just your mortgage to your friend’s rent.
You can save on repair costs if you learn to be handy. Which brings me back to: buy a house for the lifestyle.
If you want to be in a place a decade plus, and if it’s important that nobody can force you to move (very relevant for kids), if you are willing to learn a wide(!) variety of repair and maintenance tasks; buying a home is great.
But it’s nothing like renting. If you enjoy “I can walk away from this apartment to spend two months somewhere else and not worry about a thing” or “I don’t have to have $3,000 ready to go just in case the furnace breaks”, then don’t buy a house. You’ll be miserable.
The point I think you're missing is that part of the rent price is profit for the landlord. They don't rent out of the goodness of their hearts. So if you're renting you're paying some amount of money to make the landlord richer. If you buy, that money is making you richer.
Now as everyone has pointed out the math can get more complicated, and it's not as simple as saying the price difference between renting and mortgage is the profit you keep, but that extra money is real. And often times it means owning leaves you with more money later on. Hence, owning often is a worthwhile investment.
And the landlord is carrying the risk of losing money if housing prices crash.
True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way. Your options are give that money away, or invest it in a house. I feel pretty confident that the risk for a return below 0% is very low, so chances are high owning will be more profitable than renting.
You are completely ignoring all the attendant costs associated with the purchase and sale of a home. Closing costs for a seller can reach up to 10% of the sale price. If you turn around and sell a house after just 2 years because your job shipped you across the country you will definitely lose money from purchasing a home instead of renting.
This is not always true but is a good rule of thumb.
Before we get anyone too excited about buying a house though: depreciation, maintenance, repairs, taxes, and transaction costs are expenses not to be underestimated.
Buy a house for the lifestyle, not as an investment. A low-cost mutual fund is a way better place to save your money.
Most of that is already bundled in to rental prices, though. My coworker pays more in rent than I do for a 15 year mortgage, and it's not because his apartment is nicer than my house. Meanwhile, after 6 years I have around $80,000 of equity in my house, and he... doesn't. Obviously this various from region to region but the long term math usually works in favor of owning.
That said, if you do want to own, I would highly encourage learning to do some basic repairs on your own. You can patch up a lot of stuff with a few wrenches and a drill that would normally be hundreds of dollars to call someone for.
This is exactly my point. Rent includes expenses beyond what a mortgage covers, for example repairs. So it’s not right to compare just your mortgage to your friend’s rent.
You can save on repair costs if you learn to be handy. Which brings me back to: buy a house for the lifestyle.
If you want to be in a place a decade plus, and if it’s important that nobody can force you to move (very relevant for kids), if you are willing to learn a wide(!) variety of repair and maintenance tasks; buying a home is great.
But it’s nothing like renting. If you enjoy “I can walk away from this apartment to spend two months somewhere else and not worry about a thing” or “I don’t have to have $3,000 ready to go just in case the furnace breaks”, then don’t buy a house. You’ll be miserable.
The point I think you're missing is that part of the rent price is profit for the landlord. They don't rent out of the goodness of their hearts. So if you're renting you're paying some amount of money to make the landlord richer. If you buy, that money is making you richer.
Now as everyone has pointed out the math can get more complicated, and it's not as simple as saying the price difference between renting and mortgage is the profit you keep, but that extra money is real. And often times it means owning leaves you with more money later on. Hence, owning often is a worthwhile investment.
And the landlord is carrying the risk of losing money if housing prices crash.
True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way.
Sure it does. Usually it involves some kind of sizable downpayment and other initial costs so if you invest that same amount in something, if that something has a higher rate of return than the house, that is profit you are making over what you would have made buying the house.
While racing light mechs, your Urbanmech comes in second place, but only because it ran out of ammo.
It's just too conditional of a situation for there to be any 'right' answer. In my situation, buying at any point in my life would have been a terrible mistake, but that is just me.
This is very true.
We bought after knowing we'd spend at least another three years in Maryland. We also had government assistance which meant not making a down payment. So we bought a place in an area *packed* with an increasing number of government workers. Rent currently goes for $500 more than our mortgage.
If we weren't in this specific situation we probably wouldn't have.
Before we get anyone too excited about buying a house though: depreciation, maintenance, repairs, taxes, and transaction costs are expenses not to be underestimated.
Buy a house for the lifestyle, not as an investment. A low-cost mutual fund is a way better place to save your money.
Most of that is already bundled in to rental prices, though. My coworker pays more in rent than I do for a 15 year mortgage, and it's not because his apartment is nicer than my house. Meanwhile, after 6 years I have around $80,000 of equity in my house, and he... doesn't. Obviously this various from region to region but the long term math usually works in favor of owning.
That said, if you do want to own, I would highly encourage learning to do some basic repairs on your own. You can patch up a lot of stuff with a few wrenches and a drill that would normally be hundreds of dollars to call someone for.
This is exactly my point. Rent includes expenses beyond what a mortgage covers, for example repairs. So it’s not right to compare just your mortgage to your friend’s rent.
You can save on repair costs if you learn to be handy. Which brings me back to: buy a house for the lifestyle.
If you want to be in a place a decade plus, and if it’s important that nobody can force you to move (very relevant for kids), if you are willing to learn a wide(!) variety of repair and maintenance tasks; buying a home is great.
But it’s nothing like renting. If you enjoy “I can walk away from this apartment to spend two months somewhere else and not worry about a thing” or “I don’t have to have $3,000 ready to go just in case the furnace breaks”, then don’t buy a house. You’ll be miserable.
The point I think you're missing is that part of the rent price is profit for the landlord. They don't rent out of the goodness of their hearts. So if you're renting you're paying some amount of money to make the landlord richer. If you buy, that money is making you richer.
Now as everyone has pointed out the math can get more complicated, and it's not as simple as saying the price difference between renting and mortgage is the profit you keep, but that extra money is real. And often times it means owning leaves you with more money later on. Hence, owning often is a worthwhile investment.
And the landlord is carrying the risk of losing money if housing prices crash.
True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way. Your options are give that money away, or invest it in a house. I feel pretty confident that the risk for a return below 0% is very low, so chances are high owning will be more profitable than renting.
In the fallout of the last housing crash there is a Individual who ended up with most of the neighborhood I live in. He nearly owns every house on two streets.
I mean, I specifically said that it was more complicated than mortgage payment versus rental payment. I agree with you all that there are many things to consider, and there are very clearly situations where renting will be more profitable than owning.
I just think it's wrong to say that owning is not an investment vehicle, and should only be approached as something that offers different perks or cons for living. I do think it can be an investment vehicle, and for many, many people it will turn out to be a decent one.
Jebus314 on
"The world is a mess, and I just need to rule it" - Dr Horrible
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MrMonroepassed outon the floor nowRegistered Userregular
I find arguments to the tune of "owning is not always preferable to renting!" to be... mostly quibbling over the edge cases.
In the aggregate, it's clearly better. There are some edge cases where you come out worse, but they are extreme edge cases.
If it weren't a better option most of the time, there wouldn't be landlords. Folks who own rentable properties wouldn't rent them if the rent was less than the cost of capital + cost of maintenance
I mean, I specifically said that it was more complicated than mortgage payment versus rental payment. I agree with you all that there are many things to consider, and there are very clearly situations where renting will be more profitable than owning.
I just think it's wrong to say that owning is not an investment vehicle, and should only be approached as something that offers different perks or cons for living. I do think it can be an investment vehicle, and for many, many people it will turn out to be a decent one.
An investment vehicle whose value you can only access by becoming homeless.
It has benefit. There's a reason we have a condo. But it is first and foremost a place to lay my head and a means of eventually reducing a major line item of cost in life. After the mortgage is eventually paid off we just have to pay property tax and HOA dues. (Along with food and clothing, of course.) Which is great and a means of saving, but only after a kind.
I find arguments to the tune of "owning is not always preferable to renting!" to be... mostly quibbling over the edge cases.
In the aggregate, it's clearly better. There are some edge cases where you come out worse, but they are extreme edge cases.
If it weren't a better option most of the time, there wouldn't be landlords. Folks who own rentable properties wouldn't rent them if the rent was less than the cost of capital + cost of maintenance
I live and work in the heart of a major metropolitan area, and while renting is expensive, owning a condo larger than a shoebox or a home that isn’t about to fall over and sink into the swamp is a massively expensive undertaking, especially on a single income.
Like, sure, owning is definitely preferable.
But if I don’t have the down payment, I just... don’t. And with rent increasing leaps and bounds (like, 50% on average in the last 3 years), I’d be terrified to take a gamble on possibly getting fuuuuucked if I ended up having to be back in the rental game in the next few years. Like paying 50% more for a place half as good as I have now.
Toronto is a particularly expensive place to own in, granted, but I don’t feel it’s an edge case either.
Sure, I could look outside of town, as many of my colleagues do. I’d also be trading possible ownership for 10-20+ hours a week in commuting (with extra costs that add on top of those lost hours).
It’s not an easy thing to balance out, is all I’m trying to convey.
First they came for the Muslims, and we said NOT TODAY, MOTHERFUCKER!
Supposedly dairy farmers are raising prices because if they don"t theyll go bankrupt, but the market had an oversupply of milk at the same time. Demand is way down and they never cut back production even with plenty of small operators folding.
Seems like they are going to go bankrupt but maybe it helps on the insurance side somehow? Seems fishy.
Regarding the bold, a dairy farmer doesn't cut back on production because if you stop milking a cow it stops producing milk. It is better to milk the cow and dump the milk down the drain so that you can continue to milk it when demand goes back up than it is to stop milking and have no extra milk when demand goes back up. This makes it so when demand goes up more milk can be sold instead of the price rising while the farmer waits for the cow to gestate another calf to start producing milk again.
Supposedly dairy farmers are raising prices because if they don"t theyll go bankrupt, but the market had an oversupply of milk at the same time. Demand is way down and they never cut back production even with plenty of small operators folding.
Seems like they are going to go bankrupt but maybe it helps on the insurance side somehow? Seems fishy.
Regarding the bold, a dairy farmer doesn't cut back on production because if you stop milking a cow it stops producing milk. It is better to milk the cow and dump the milk down the drain so that you can continue to milk it when demand goes back up than it is to stop milking and have no extra milk when demand goes back up. This makes it so when demand goes up more milk can be sold instead of the price rising while the farmer waits for the cow to gestate another calf to start producing milk again.
Also, 2% milk is $2.19 a gallon here.
You also don't just stop because dairy cows in full production can develop infections or potentially die if not milked.
Just remember that half the people you meet are below average intelligence.
I mean, I specifically said that it was more complicated than mortgage payment versus rental payment. I agree with you all that there are many things to consider, and there are very clearly situations where renting will be more profitable than owning.
I just think it's wrong to say that owning is not an investment vehicle, and should only be approached as something that offers different perks or cons for living. I do think it can be an investment vehicle, and for many, many people it will turn out to be a decent one.
An investment vehicle whose value you can only access by becoming homeless.
It has benefit. There's a reason we have a condo. But it is first and foremost a place to lay my head and a means of eventually reducing a major line item of cost in life. After the mortgage is eventually paid off we just have to pay property tax and HOA dues. (Along with food and clothing, of course.) Which is great and a means of saving, but only after a kind.
You can access your investment by selling and buying a smaller residence (or switching to renting). Or you can borrow against it. Both are very popular with retirees here.
Incidentally, why are you all talking as if the only choice is "buy house" or "rent apartment"? I own a condo in a housing cooperative.
I haven't done squat on maintenance in 10 years, and I've got a new coat of paint, repaired gutters, fixed radiators, and new sewage pipes all done by professionals (covered by the cooperative's cash funds and organized by people who aren't me). I don't even have to mow the lawn or plow snow. Combines the advantages of living in an apartment and owning a house without (most of) the downsides.
Something I've always found interesting is the price of gas and milk in relation to each other.
It's ... probably not especially useful or indicative of anything specific, but it's always a neat comparison for me, because I've always found them to be relatively close together.
any food which has to be refrigerated in transit is gonna track the price of fuel pretty closely; milk of course, but also fruits and lots of other stuff. It basically has to come by truck, the margins are low and you can't reasonably stockpile.
it was the smallest on the list but
Pluto was a planet and I'll never forget
I mean, I specifically said that it was more complicated than mortgage payment versus rental payment. I agree with you all that there are many things to consider, and there are very clearly situations where renting will be more profitable than owning.
I just think it's wrong to say that owning is not an investment vehicle, and should only be approached as something that offers different perks or cons for living. I do think it can be an investment vehicle, and for many, many people it will turn out to be a decent one.
An investment vehicle whose value you can only access by becoming homeless.
It has benefit. There's a reason we have a condo. But it is first and foremost a place to lay my head and a means of eventually reducing a major line item of cost in life. After the mortgage is eventually paid off we just have to pay property tax and HOA dues. (Along with food and clothing, of course.) Which is great and a means of saving, but only after a kind.
You can access your investment by selling and buying a smaller residence (or switching to renting). Or you can borrow against it. Both are very popular with retirees here.
That isn't accessing your investment, it's taking on new debt at the risk of losing your home. The only way to actually access the savings of your home ownership is to sell your home. Like I said, become homeless.
That's certainly not impossible, nor necessarily a bad decision to undertake, and you can probably find something better suited if you want to cash out. But it's also not a minor inconvenience. I'm attached to where I live in a way that I'm not to a checking account, or share of stock. Dumping all my holdings in Visa won't materially impact my life. Finding a new home, moving into it, and adjusting to a new neighborhood would.
Barack 'Oh that's right this is what an actual President looks like, I had totally forgotten' Obama: Eleven years ago today, near the bottom of the worst recession in generations, I signed the Recovery Act, paving the way for more than a decade of economic growth and the longest streak of job creation in American history.
The President of the United States: IF OUR FORMALLY TARGETED FARMERS NEED ADDITIONAL AID UNTIL SUCH TIME AS THE TRADE DEALS WITH CHINA, MEXICO, CANADA AND OTHERS FULLY KICK IN, THAT AID WILL BE PROVIDED BY THE FEDERAL GOVERNMENT, PAID FOR OUT OF THE MASSIVE TARIFF MONEY COMING INTO THE USA!
Reminder that we have lost more money bailing out farmers than we could have ever gotten even in Trumps own fantasy best case scenario's with these tariffs.
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ButtersA glass of some milksRegistered Userregular
It's a wonder we have a trillion dollar deficit under this man
The President of the United States: IF OUR FORMALLY TARGETED FARMERS NEED ADDITIONAL AID UNTIL SUCH TIME AS THE TRADE DEALS WITH CHINA, MEXICO, CANADA AND OTHERS FULLY KICK IN, THAT AID WILL BE PROVIDED BY THE FEDERAL GOVERNMENT, PAID FOR OUT OF THE MASSIVE TARIFF MONEY COMING INTO THE USA!
Reminder that we have lost more money bailing out farmers than we could have ever gotten even in Trumps own fantasy best case scenario's with these tariffs.
We have given more money to Farmers for this stupidity than we have to Chrysler and GM during the Great Recession, over the complaints of Republicans. And then they paid us back with interest, which will not happen for these funds.
The President of the United States: IF OUR FORMALLY TARGETED FARMERS NEED ADDITIONAL AID UNTIL SUCH TIME AS THE TRADE DEALS WITH CHINA, MEXICO, CANADA AND OTHERS FULLY KICK IN, THAT AID WILL BE PROVIDED BY THE FEDERAL GOVERNMENT, PAID FOR OUT OF THE MASSIVE TARIFF MONEY COMING INTO THE USA!
Reminder that we have lost more money bailing out farmers than we could have ever gotten even in Trumps own fantasy best case scenario's with these tariffs.
Additional Reminder that "TARIFF MONEY" does not come "INTO THE USA," as tariffs are taxes paid by domestic businesses and passed on to their domestic consumers.
If you need to bail out farmers multiple years in a row because even with the massive subsidies they get then you need to seriously reasess WTF is going on with your policies.
Though it does ammuse me to no end that a bunch of these folks won't grasp that this is straight up socialism.
If you need to bail out farmers multiple years in a row because even with the massive subsidies they get then you need to seriously reasess WTF is going on with your policies.
Though it does ammuse me to no end that a bunch of these folks won't grasp that this is straight up socialism.
Even with all these additional subsidies farm bankruptcies are at highs not seen since the Great Recession. Trump is literally worse than a once in a lifetime (hopefully) economic catastrophe.
Commending on something posted in the immigration thread. Mulvaney was bemoaning the fact that the lack of immigration was hurting some businesses that relied on them. It's also worth pointing out that in addition to the nativist assholes making it harder for immigrants to get in, which lowers the potential labor pool for businesses. There is also the whole issue of many businesses being fucking cheap on wages, that many people have concluded that working isn't going to help them any more than being on social assistance. Hell, I think we're probably back to where we were before ADA was passed, where there are a number of individuals with disabilities that would love to work, but can't because our system would completely fuck them over and the worst thing is they could get the bare minimum of work and that would royally fuck them because republicans have gotten stuff changes to the point that any money gain will make someone ineligible for assistance, even if said amount is far, far, far, far, far, far away from the amount they'd need to cover all the cost they need to continuing surviving because their medical needs and/or accommodations aren't cheap.
Before we get anyone too excited about buying a house though: depreciation, maintenance, repairs, taxes, and transaction costs are expenses not to be underestimated.
Buy a house for the lifestyle, not as an investment. A low-cost mutual fund is a way better place to save your money.
Most of that is already bundled in to rental prices, though. My coworker pays more in rent than I do for a 15 year mortgage, and it's not because his apartment is nicer than my house. Meanwhile, after 6 years I have around $80,000 of equity in my house, and he... doesn't. Obviously this various from region to region but the long term math usually works in favor of owning.
That said, if you do want to own, I would highly encourage learning to do some basic repairs on your own. You can patch up a lot of stuff with a few wrenches and a drill that would normally be hundreds of dollars to call someone for.
This is exactly my point. Rent includes expenses beyond what a mortgage covers, for example repairs. So it’s not right to compare just your mortgage to your friend’s rent.
You can save on repair costs if you learn to be handy. Which brings me back to: buy a house for the lifestyle.
If you want to be in a place a decade plus, and if it’s important that nobody can force you to move (very relevant for kids), if you are willing to learn a wide(!) variety of repair and maintenance tasks; buying a home is great.
But it’s nothing like renting. If you enjoy “I can walk away from this apartment to spend two months somewhere else and not worry about a thing” or “I don’t have to have $3,000 ready to go just in case the furnace breaks”, then don’t buy a house. You’ll be miserable.
The point I think you're missing is that part of the rent price is profit for the landlord. They don't rent out of the goodness of their hearts. So if you're renting you're paying some amount of money to make the landlord richer. If you buy, that money is making you richer.
Now as everyone has pointed out the math can get more complicated, and it's not as simple as saying the price difference between renting and mortgage is the profit you keep, but that extra money is real. And often times it means owning leaves you with more money later on. Hence, owning often is a worthwhile investment.
And the landlord is carrying the risk of losing money if housing prices crash.
True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way. Your options are give that money away, or invest it in a house. I feel pretty confident that the risk for a return below 0% is very low, so chances are high owning will be more profitable than renting.
You are completely ignoring all the attendant costs associated with the purchase and sale of a home. Closing costs for a seller can reach up to 10% of the sale price. If you turn around and sell a house after just 2 years because your job shipped you across the country you will definitely lose money from purchasing a home instead of renting.
This is not always true but is a good rule of thumb.
Isn't the rule of thumb that it is better to buy if you plan on staying in the area 5+ years?
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MonwynApathy's a tragedy, and boredom is a crime.A little bit of everything, all of the time.Registered Userregular
Something I've always found interesting is the price of gas and milk in relation to each other.
It's ... probably not especially useful or indicative of anything specific, but it's always a neat comparison for me, because I've always found them to be relatively close together.
any food which has to be refrigerated in transit is gonna track the price of fuel pretty closely; milk of course, but also fruits and lots of other stuff. It basically has to come by truck, the margins are low and you can't reasonably stockpile.
Fuel costs have almost no bearing on bulk transport prices. Either carriers are working on a fixed, contracted rate, in which case the fuel cost is literally irrelevant because prices are locked in for 3+ months, or they're spot quoted, and the availability of trucks (at both ends of the route) is vastly more important.
Something I've always found interesting is the price of gas and milk in relation to each other.
It's ... probably not especially useful or indicative of anything specific, but it's always a neat comparison for me, because I've always found them to be relatively close together.
any food which has to be refrigerated in transit is gonna track the price of fuel pretty closely; milk of course, but also fruits and lots of other stuff. It basically has to come by truck, the margins are low and you can't reasonably stockpile.
Fuel costs have almost no bearing on bulk transport prices. Either carriers are working on a fixed, contracted rate, in which case the fuel cost is literally irrelevant because prices are locked in for 3+ months, or they're spot quoted, and the availability of trucks (at both ends of the route) is vastly more important.
Lol no. Fuel is the #1 expense of heavy transport logistics, more than driver pay, more than vehicle purchase and maintenance, more than insurance. When diesel goes up by 20%, so do shipping prices for almost everything.
Something I've always found interesting is the price of gas and milk in relation to each other.
It's ... probably not especially useful or indicative of anything specific, but it's always a neat comparison for me, because I've always found them to be relatively close together.
any food which has to be refrigerated in transit is gonna track the price of fuel pretty closely; milk of course, but also fruits and lots of other stuff. It basically has to come by truck, the margins are low and you can't reasonably stockpile.
Fuel costs have almost no bearing on bulk transport prices. Either carriers are working on a fixed, contracted rate, in which case the fuel cost is literally irrelevant because prices are locked in for 3+ months, or they're spot quoted, and the availability of trucks (at both ends of the route) is vastly more important.
Lol no. Fuel is the #1 expense of heavy transport logistics, more than driver pay, more than vehicle purchase and maintenance, more than insurance. When diesel goes up by 20%, so do shipping prices for almost everything.
Also, as Macron learned the hard way, fuel demand is inelastic, so you just can't just tell the transport sector to consume less fuel without them telling you to go fuck yourself.
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True, but every investment vehicle comes with associated risk. And it’s not like renting allows you to invest in some other way. Your options are give that money away, or invest it in a house. I feel pretty confident that the risk for a return below 0% is very low, so chances are high owning will be more profitable than renting.
Yup, this.
Milk fat (an undefined mix of mostly saturated fats ), lactose, and whey/casein is chemically quite different from canola oil (unsaturated fat), oat starch derived sugar and oat protein.
We use oatmilk a lot and it's great for coffee, cereal, cold sauces (the oat sour cream) or for adding a smidgeon just before serving.
But if you want to cook a casserole or stew you'd better go with coconut oil or just a tomato base.
Edit: I did a case study 15 years ago at Uni together with a startup making oat-based yoghurt. We even got to taste it. It was horrible but 7 years later they improved it an it can be bought pretty much everywhere now over here. It's a really cool product from an engineering standpoint.
I, for one, cannot think of a time in the last *checks notes* 10 years when house prices decreased and made all the morgages underwater
We can all shift to oat milk!
Oat milk is a hard no for me. Vanilla almond is my go to daily table substitute (best cereal moisture there is, IMO), any more I only buy whole milk or cream when I bake or am looking to make a heavy bechamel. The way the proteins in every nut and soy milk I've tried denature leads to piss poor results and/or weird aftertastes.
~ Buckaroo Banzai
All the small landlords around me barely break even, theyre all betting on appreciation to get them to a profitable exit and they increasingly cant raise rent because the bigger complexes have economies of scale.
Some luxury properties go empty instead of being rented but I think that is mostly a Vancouver/NYC/SF thing? Not the average unit, certainly.
Yeah, they should have tried to compensate with an increase in whole milk sales.
Ba dum psh
You are completely ignoring all the attendant costs associated with the purchase and sale of a home. Closing costs for a seller can reach up to 10% of the sale price. If you turn around and sell a house after just 2 years because your job shipped you across the country you will definitely lose money from purchasing a home instead of renting. Even without an '08 real estate collapse.
This is not always true but is a good rule of thumb.
Sure it does. Usually it involves some kind of sizable downpayment and other initial costs so if you invest that same amount in something, if that something has a higher rate of return than the house, that is profit you are making over what you would have made buying the house.
This is very true.
We bought after knowing we'd spend at least another three years in Maryland. We also had government assistance which meant not making a down payment. So we bought a place in an area *packed* with an increasing number of government workers. Rent currently goes for $500 more than our mortgage.
If we weren't in this specific situation we probably wouldn't have.
In the fallout of the last housing crash there is a Individual who ended up with most of the neighborhood I live in. He nearly owns every house on two streets.
I just think it's wrong to say that owning is not an investment vehicle, and should only be approached as something that offers different perks or cons for living. I do think it can be an investment vehicle, and for many, many people it will turn out to be a decent one.
In the aggregate, it's clearly better. There are some edge cases where you come out worse, but they are extreme edge cases.
If it weren't a better option most of the time, there wouldn't be landlords. Folks who own rentable properties wouldn't rent them if the rent was less than the cost of capital + cost of maintenance
An investment vehicle whose value you can only access by becoming homeless.
It has benefit. There's a reason we have a condo. But it is first and foremost a place to lay my head and a means of eventually reducing a major line item of cost in life. After the mortgage is eventually paid off we just have to pay property tax and HOA dues. (Along with food and clothing, of course.) Which is great and a means of saving, but only after a kind.
I live and work in the heart of a major metropolitan area, and while renting is expensive, owning a condo larger than a shoebox or a home that isn’t about to fall over and sink into the swamp is a massively expensive undertaking, especially on a single income.
Like, sure, owning is definitely preferable.
But if I don’t have the down payment, I just... don’t. And with rent increasing leaps and bounds (like, 50% on average in the last 3 years), I’d be terrified to take a gamble on possibly getting fuuuuucked if I ended up having to be back in the rental game in the next few years. Like paying 50% more for a place half as good as I have now.
Toronto is a particularly expensive place to own in, granted, but I don’t feel it’s an edge case either.
Sure, I could look outside of town, as many of my colleagues do. I’d also be trading possible ownership for 10-20+ hours a week in commuting (with extra costs that add on top of those lost hours).
It’s not an easy thing to balance out, is all I’m trying to convey.
Regarding the bold, a dairy farmer doesn't cut back on production because if you stop milking a cow it stops producing milk. It is better to milk the cow and dump the milk down the drain so that you can continue to milk it when demand goes back up than it is to stop milking and have no extra milk when demand goes back up. This makes it so when demand goes up more milk can be sold instead of the price rising while the farmer waits for the cow to gestate another calf to start producing milk again.
Also, 2% milk is $2.19 a gallon here.
You also don't just stop because dairy cows in full production can develop infections or potentially die if not milked.
You can access your investment by selling and buying a smaller residence (or switching to renting). Or you can borrow against it. Both are very popular with retirees here.
Incidentally, why are you all talking as if the only choice is "buy house" or "rent apartment"? I own a condo in a housing cooperative.
I haven't done squat on maintenance in 10 years, and I've got a new coat of paint, repaired gutters, fixed radiators, and new sewage pipes all done by professionals (covered by the cooperative's cash funds and organized by people who aren't me). I don't even have to mow the lawn or plow snow. Combines the advantages of living in an apartment and owning a house without (most of) the downsides.
any food which has to be refrigerated in transit is gonna track the price of fuel pretty closely; milk of course, but also fruits and lots of other stuff. It basically has to come by truck, the margins are low and you can't reasonably stockpile.
Pluto was a planet and I'll never forget
That isn't accessing your investment, it's taking on new debt at the risk of losing your home. The only way to actually access the savings of your home ownership is to sell your home. Like I said, become homeless.
That's certainly not impossible, nor necessarily a bad decision to undertake, and you can probably find something better suited if you want to cash out. But it's also not a minor inconvenience. I'm attached to where I live in a way that I'm not to a checking account, or share of stock. Dumping all my holdings in Visa won't materially impact my life. Finding a new home, moving into it, and adjusting to a new neighborhood would.
Reminder that we have lost more money bailing out farmers than we could have ever gotten even in Trumps own fantasy best case scenario's with these tariffs.
We have given more money to Farmers for this stupidity than we have to Chrysler and GM during the Great Recession, over the complaints of Republicans. And then they paid us back with interest, which will not happen for these funds.
Additional Reminder that "TARIFF MONEY" does not come "INTO THE USA," as tariffs are taxes paid by domestic businesses and passed on to their domestic consumers.
Though it does ammuse me to no end that a bunch of these folks won't grasp that this is straight up socialism.
Even with all these additional subsidies farm bankruptcies are at highs not seen since the Great Recession. Trump is literally worse than a once in a lifetime (hopefully) economic catastrophe.
battletag: Millin#1360
Nice chart to figure out how honest a news source is.
Isn't the rule of thumb that it is better to buy if you plan on staying in the area 5+ years?
Fuel costs have almost no bearing on bulk transport prices. Either carriers are working on a fixed, contracted rate, in which case the fuel cost is literally irrelevant because prices are locked in for 3+ months, or they're spot quoted, and the availability of trucks (at both ends of the route) is vastly more important.
Lol no. Fuel is the #1 expense of heavy transport logistics, more than driver pay, more than vehicle purchase and maintenance, more than insurance. When diesel goes up by 20%, so do shipping prices for almost everything.
Also, as Macron learned the hard way, fuel demand is inelastic, so you just can't just tell the transport sector to consume less fuel without them telling you to go fuck yourself.