These sliders are immensely helpful with quick estimates!
NY times again telling people it’s better to own nothing.
“Save” 133k over 10 years, but throw all the rest of your housing money directly down the toilet. Can’t sell a rented apartment when you no longer need it, so even if the house doesn’t appreciate, you still come out far ahead with buying in most situations.
Plus you never stop paying for rent, but eventually you stop paying the mortgage.
It’s definitely different for every person, and situationally dependent.
If you are as well off as Taylor Swift and get to choose… yeah, rent if you don’t want to deal with the hassle of home ownership. You’re rich and will be fine no matter what you do.
For everyone else, if you generally are going to work in the same geographic area (even if a bit of a commute) for the next decade… then yeah, if afforded the opportunity, buy. It’s better to own something if given the chance (in general).
Hard to say in this current market. I took a 0% down payment mortgage out a decade ago, have paid off 30k, and have 200k in fake equity. Fake equity as the valuation is real estate bubble BS, and buying now could result in a massive negative equity (putting borrowers under water) if/when that bubble bursts, but simple fact of the matter is, as the above poster mentions, as long as you keep paying the mortgage, you actually get some equity/own something.
Worst case, your loan does go under… you go bankrupt and end up… right back where you were if you were renting anyways.
The way I like to look at it, is a mortgage (fixed) only gets cheaper. A decade from now, you’re making more money, but inflation has devalued your income? Your mortgage principle + interest did not change in that time, so inflation has technically made your mortgage cheaper; whereas we’ve seen rents double, triple, or even quadruple in the past decade.
Note for the curious: While FDA and similar loans can get you lower down payments, what I used for 0% was a USDA Rural Development loan - only allows you to buy in certain areas (not metros typically), but you may be surprised what areas do qualify - check out the map, anything not highlighted qualifies - zoom on in, maybe that ‘small town’ a 10 minute drive outside the big city does: https://eligibility.sc.egov.usda.gov/eligibility/welcomeAction.do … even winning a bid on homes in the current market may be tough though…
It’s an intersting contradiction trying to square what seems to be two completely different approches to housing. You seem to be mainly concerned with having stable housing on your own terms as your priority. This article seems to be targeted toward those whose priority is capital gains. While you and I see a house as a place to live, the market sees housing as a financial asset and the main financial asset available to the average person. Through that lens, this article demonstrates that one could actually lose money on their investment instead of gaining it implying it would be better to invest elsewhere.
The own nothing and like it model works very well for plutocrats since what they “own” are valuable financial assets which can be leveraged to borrow as much tax-free cash as they want for as long as they live, using their unlimited credit to borrow more cash to pay back the loans until they die. A step below that are people who understand that it’s always better to risk the bank’s money than one’s own and live their lives on credit as well. That’s all the capitalists who can basically live through arbitrage. The model breaks down a bit for us workers who are expected to behave like capitalists but without access to the credit that comes from the social classes described above. There are some people who luck out doing this, but this system was not made for regular people. I personally would rather live like a person with a house.
You can’t make such a decision based on simple financial calculations, not in the least as there is no way to make reasonable predictions in our current market environments. Ask any investment advisor, and they will tell you to buy your home if you can afford it.
This is off-topic: Why is the NYT accessing the camera when going to the linked article?
Why is the NYT accessing the camera when going to the linked article?
This isn’t happening to me. Not sure why it’s happening to you.
Why is the NYT accessing the camera
Didn’t happen to me on Waterfox…
Not US-based, German, but residential prices go crazy here as well.
For me it was the best decision to buy a house. For two reasons: you surf on the asset inflation as well. Moving to a new house last year wasn’t that pricey as I only had to borrow the difference old vs new bigger house.
Second reason is psychology: I don’t know somebody who has stocks in their account in same height as a house price. Paying mortgage forces you to save money. Having a (low) 6-digit stock account, feels being rich and money flows out into buying things.