Own or rent?

IceQueen · January 29th, 2006, 01:12 PM

Ok, so I'm stressing out over this:

Hubby and I own our house for a year. We just did our taxes and realized that the tax breaks really aren't that great... and our house payments (not to mention utilities and property taxes) are twice as much as they would be if we rented. Granted, we wouldn't have any equity - but how much is that really worth?

We've been in this house for over a year now, and are seriously contemplating selling and just renting so we can save. Our savings are non-existent and we don't even have money to fix up the house. Does anyone have any experience or advice?

If it isn't obvious, we went into buying the house blindly, and don't want to leave the same way.

UndercoverGator · January 29th, 2006, 02:29 PM

Do not sell!!! Hang in there. Just to give you an example of why not.

When we first moved to our town 16 years ago we had an average 4 bedroom 2 bath home built for around 90K and we were thinking exactly the same thing as you. My brother in law and his wife did the exact same thing we did, thought the same and ended up deciding to sell a year later. They actually lost money on the sale of the house.

Now this area is hot and my built for 90K house is worth nearly 500K and it's paid for. Our investment increased well beyond what we could have ever imagined. Putting your money into a home that you'll own one day is always better than renting, particularly when you're young. We're already planning on selling this place in a few years when Mr. Gator retires and moving elsewhere, to a smaller retirement place on the ocean and pocketing the difference towards our retirement expenses.

Tenaj · January 30th, 2006, 03:03 AM

Don't rent. Renting I feel is good for a first option to see if you can actually live together before buying, or for a group of friends say that may wish to move out at different points.

My boyfriend and I rented for 6 months before buying our own place. I think renting long term is silly, you are simply helping to pay off someone elses mortgage while you are there. It's dead money. At least if you own your house you are paying it off, granted it takes time though.

We've been in our house for a year and a half now and we also very rarely have enough money left to fix the house up. It takes time to do so. We're simply taking it a step at a time. We got our house cheap for the area it is in because so much work needs doing, but when it is done it will be worth a hell of a lot more. People my age are buying nice houses in worser areas to afford them, whilst we live in a house that needs an overhall but it is in a good area and when completed will be fab.

Just stick in there, don't lose heart. If I were considering what you are considering I would feel I am taking a step back. However you really need to decide what is best for you.

Tiara · January 30th, 2006, 03:34 AM

I'd definitely say buy, nobody I've ever know to rent have had good things to say about it.

My bf has just bought his first house its large and in a nice area, he was lucky to get it at a decent price because he' knows the person we're buying it from. A girl I work with has been bragging about moving to a nice area (where she lives now is a shit hole) but at the end of the day my bf's house is his, hers is being rented. If my bf wanted to rent he could afford a much nicer, bigger place in a much more expensive area than she can, but he would rather own his own house.

SammysMom · January 30th, 2006, 06:00 PM

Why not Monkey? We have rented for the past three years and we are able to put money back because we dont have to pay property, school or water taxes.

AliceInWonderland · January 30th, 2006, 06:05 PM

Yeah no shit! You should read "Rich Dad, Poor Dad" IceQueen and you'll see that houses are just money pits, bottomless money pits of constant upkeep, taxes, insurance, time and money...if you must buy; buy a multi-unit place and live in 1 unit and rent out the rest; which their rent goes to your mortgage. Thats how real money is made.

pacific breeze · January 30th, 2006, 07:01 PM

^^ There was an article a while ago -- I'll see if I can find it -- where analysts examined several case studies and proved, depending on your lifestyle needs, that if you rent and invest sensibly, you will almost always come out ahead of the game than an owner. Now there are variables involved like markets, real estate and stock, but bottom line, owning a house is often more about a feeling than an economic gain.

mklady · January 30th, 2006, 09:42 PM

We rented for about 2 years before we bought our house. For us, part of getting a house was location. We wanted to be in Maryland and our house is about an hour or less from cities and when we moved back to MD, the hubby was working for his parents until he could find a new job so we needed to be within reasonable driving distance to a couple of places. We bought this house in 1999 for $110K, it appraised for $204K this summer and our neighbors just sold theirs for $240K. Having a house gave us some leverage to get some bills taken care of and get a "new" used car (which has since been rear ended and totalled, grrr). Right now, even with refinancing this summer, we only owe $161K on the house which we're going to sell and then build a two story farmhouse modular at my in-laws farm. Eventually, we'll be without a mortgage, but the house will give us some leverage if we need it.

I will say that if we were still renting, some things would be easier. This house came with a pool and a yard. My husband doesn't want to take care of either. Handyman he is not. I am. So, there are things that are aggravating to take care of, but, it just comes with the territory. I just look at this house as an investment that will put us in a position to have the dream house that we want.

chatterweb · January 31st, 2006, 12:05 AM

Quote:

I will say that if we were still renting, some things would be easier. This house came with a pool and a yard. My husband doesn't want to take care of either. Handyman he is not. I am. So, there are things that are aggravating to take care of, but, it just comes with the territory. I just look at this house as an investment that will put us in a position to have the dream house that we want.

I agree with the above!!!
DH and I have bought 3 homes since 2001 ,and have sold just one so far...The first one we bought for 180K, sold it for 380K, almost 3 years later...We put 100K down on the next home...pool, spa, big yard...too big for us, it is just us and our 2 dogs and 1 cat...Well, we had some extra $$$ from selling the first home, so, we bought a brand new home out of state last year, for the tax write off, and for investing. It is a lot of work and stress. Sometimes, I think we should rent our homes out and rent a place...I wish we had never movedfrom house#1, but it was really old and this one is in a better area.

Voodoo Child · January 31st, 2006, 12:17 AM

I would say buy too. I am in the process of saving to buy my own place. I have put away every spare cent (apart from much needed skincare haircare shoes clothes!! ) since I was very young. It was always drummed into my head about saving early for an investment property. I don't have enough for a deposit yet. If I could get past the ~buying mindless crap~, then I could achieve my dream faster.

Being a poor uni student with a part time job in sales, does not help my cause much.

Tiara · January 31st, 2006, 03:05 AM

My mum owns her house completely she doesn't pay anything but her monthly bills for water, gas, light etc.

buttmunch · January 31st, 2006, 04:02 AM

We rent and happy to do so. Great place in a great city neighborhood and no strings attached. But it's really such a personal decision. We owned a house for awhile but felt it was not worth it, so switched back to renting. It depends in part as to whether or not you plan on staying in the area for a long time. We're quite nomadic, so renting is fine with us. The only I'll probably ever buy is a beach house, simply so I can always have a place by the ocean.

A*O · January 31st, 2006, 05:50 AM

Seems to me that renting is much more the norm (and 'socially acceptable') in the US and Europe. If you rent in the UK then people assume you are either an impoverished student, unemployed layabout on benefits, or on temporary work contract from overseas. The Ultimate Dream of most Brits is to own their own home and many put themselves into hopeless debt to achieve it.

Tiara · January 31st, 2006, 05:51 AM

^^ Don't forget chavs!!

Tenaj · January 31st, 2006, 05:56 AM

Quote:

Originally Posted by A*O

Seems to me that renting is much more the norm (and 'socially acceptable') in the US and Europe. If you rent in the UK then people assume you are either an impoverished student, unemployed layabout on benefits, or on temporary work contract from overseas. The Ultimate Dream of most Brits is to own their own home and many put themselves into hopeless debt to achieve it.

Sorry to disagree here but when I was renting I was only paying £20 less than I am now? I don't think £20 difference is going to be be in serious debt. I don't look down on people who rent, I just don't see the point of paying off someone elses mortgage. As a temporary measure renting is fine, but long term you may aswell flush your money away.