I in principal agree with that. Currently when I'm having trouble making ends meet as it is, and then something happens when it comes down to dinner or fixing the air conditioning what do you do? I'm not saying my situation is QUITE that bad, but it aint much better lol. I'm just dropping back for a bit, getting ourselves in a better position, then we move forward. Just right now is not the time.
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I'm so tired of owning a home
- Thread starter OscarTheGrouch
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I in principal agree with that. Currently when I'm having trouble making ends meet as it is, and then something happens when it comes down to dinner or fixing the air conditioning what do you do? I'm not saying my situation is QUITE that bad, but it aint much better lol. I'm just dropping back for a bit, getting ourselves in a better position, then we move forward. Just right now is not the time.
Totally understand - every situation is different and you have to do what makes the most sense for you, personally and financially.
Simply stated.
And I agree.
But there are times when owning a home/townhome/condo/whatever, that it is simply not fun. This can be for a variety of reasons, but usually it seems the reason is bad such as broken pluming and flooding, termites, foundation issues, etc.
And if you happen to rent out your property, the issues multiply.
Reminds me of a friend who owned a home in Portland Oregon that he rented out. The renters turned it into a crack/cocaine house. Lucky him.
But bottom line, if you can rent or own and pay around the same amount, I would choose owning. Even if the property value stays the same or decreases, you will still have more worth than if you rent.
Yep, quite true. As I said earlier, there are trade-offs with everything - you've cited some good ones with repsect to home ownership, and things which prospective home buyers should keep in mind especially if they are considering the rental angle.
As with any major decision or purchase, do your due diligence ahead of time, weigh the pros and cons and decide what you truly want.
There. Fixed it for you.Yep, quite true. As I said earlier, there are trade-offs with everything - you've cited some good ones with repsect to home ownership, and things which prospective home buyers should keep in mind especially if they are considering the rental angle.
As with any major decision or purchase, do your due diligence ahead of time, weigh the pros and cons and decide what you truly want.
Agree 100% Well said.
It is a nice feeling when you can say you own a small piece of the big pie.
That's true. No pie for me until I finish my last degree. I've watched my dad grumble through almost thirty years of home maintenance and I'm convinced that, unless you are fabulously wealthy, home ownership is better than renting.
$60k! For student loans? That's it?
Where did you go to school that you think that is cheap? Good lord, you can get 2 BAs and an MA for that price from a state university.
You gave me the best answer I have heard so far. Congrats on your pursuing a master's in economics. I loved the one econ class I took in MBA school but it was only the most brief of courses touching a little on micro and some on macro. Basically, most MBA school models call for a semester and the most they get into it is on a supply-demand model, which I know is simplistic.
I know the business related MS degrees in economics, quantitative analysis, accounting, or operations management (and others) are far more detailed and specialized than the general MBA. I thought of an MS instead but there was far too much math.
What looked like what happened in Silicon Valley is that the prices shot up so high that a lot of my friends got disgusted and in the 2000s, got out or seriously considered it and then the houses that once were hot suddenly were not. I thought that was simply due to other areas looking far more attractive because the housing prices outside of the Silicon Valley were so much lower.
I'm in limbo between MBA and a Masters in Econ -- the Masters in Econ -- There are a lot of young guys (and girls) trying to break into Finance and i'm trying to make myself as marketable as possible -- one way or the other i'll be doing the CFA (Chartered Financial Analyst) designation, but what graduate level work to compliment it is still a decision i have to make.
~Shard~ said:
"Blush"
sushi said:
The cost of buying is quite high
considering a $220,000 home will cost $430,000 but the time you put that $20,000 down payment, and amortize your $200,000 over 25 years at 7% (mortgage rates are lower right now, but that won't last forever) by the time you add insurance, taxes, repairs, that home can easily cost you $600,000 over those 25 years
on the flip side, renting at $1,000 a month for 25 years will cost you $300,000 (This assumes your rent never goes up over that time period -- highly unlikely unless you have rent control -- and that will reduce your living standards)
Given that you HAVE to live somewhere if you can take the $600,000 you spend on your home, and subtract the $300,000 of sunk costs you would incur renting (unadjusted for inflation) and that leaves you needing your home appreciating to $300,000 over 25 years to -- that's a mear 1.6% growth rate per year, and you've now passively set aside some equity that you might of not (as many people don't) for the future.
even if your growth rate doubled to a mere 3.2% per year over that time, then you now have $483,520 in equity --- much further ahead then if you sunk $300,000 + in renting
cheers
well let's see
if I do all this living at home
my BA was $6,000 in tuition per year for 4 years + $1500 in books over 4 years + $2500 additional professional based certification and extra courses + then if I do my MBA rather then my Masters in Econ, and I do it in Canada (keeping with my stipulation that i live at home) $35,000 per year estimated costs for 2 years
= total cost of BA and MBA $102,500 <-- this doesn't include costs that would of been associated IF i lived away
$60,000 is not that unreasonable
Yeah, it's rock. I had a killer mac set up on that desk, but moved all that stuff into storage. Realtors sometimes leave the door unlocked when they show the place and I'm not taking any chances with mac / photo gear, and my firearm collection (which wouldn't look good to potential buyers anyway). It came in handy when I wanted to scare my neighbors though.
I certainly don't know the Canadian market, but in the states, there are slow times when the MBA is a diploma like Confederate currency and thus not worth a lot. In good economic times, then there seems to be way more jobs than MBAs to fill them and it's a pretty hot ticket. But I have never seen a master's in economics considered an empty diploma. Everyone will respect you which cannot always be said of the extremely common MBA.
A pretty good compromise, if you find such a school with specialized MBAs, would be an MBA in Economics. Have you considered an MBA in Accounting or an MS in Accounting?
The MBA programs i've been looking at are the MBA/CFA so a specialization in Finance
many of my industry contacts say this combination would have me head hunted while still in school
I haven't really asked around about the Masters in Econ
My understanding is that the MBA, many times, is valued by WHERE you go to get it, versus what you learn in it?
As an MBA holder ... what are you thoughts on that?
You've obviously done your research, which is good - many people do not factor in all the associated costs with a home. The mortgage alone - as you alluded to, depending on the interest rate and such, a person could end up paying twice as much for their house over the span of the mortgage! People criticize renters for "throwing their money away" in rent, however what about home owners who pay property taxes and (in Canada) non-deductable interest on their mortgage? That money does not add to your investment at all, so it's essentially money you're throwing away as well.
Further to this, this is the big difference I discovered between the US and Canada - in the US your mortgage interest is tax deductible - in Canada it is not. To offset that I believe in the States you pay more tax when you sell your home though whereas in Canada if it is deemed your primary residency you pay no capital gains. Anyway, the interest thing is huge. As a result, my wife and I structured things such that we avoided "bad interest" (i.e. non-deductible) for our house and instead have "good interest" (i.e. deductible) which is going to save us tens of thousands of dollars over the long run, if not more.
This gets into a whole other discussion though on money management techniques, tax strategies, investing, etc. and although I have a passion for all things financial I won't bother putting that hat on right now in this thread lest I hijack it.
You've obviously done your research, which is good - many people do not factor in all the associated costs with a home. The mortgage alone - as you alluded to, depending on the interest rate and such, a person could end up paying twice as much for their house over the span of the mortgage! People criticize renters for "throwing their money away" in rent, however what about home owners who pay property taxes and (in Canada) non-deductable interest on their mortgage? That money does not add to your investment at all, so it's essentially money you're throwing away as well.
Further to this, this is the big difference I discovered between the US and Canada - in the US your mortgage interest is tax deductible - in Canada it is not. To offset that I believe in the States you pay more tax when you sell your home though whereas in Canada if it is deemed your primary residency you pay no capital gains. Anyway, the interest thing is huge. As a result, my wife and I structured things such that we avoided "bad interest" (i.e. non-deductible) for our house and instead have "good interest" (i.e. deductible) which is going to save us tens of thousands of dollars over the long run, if not more.
This gets into a whole other discussion though on money management techniques, tax strategies, investing, etc. and although I have a passion for all things financial I won't bother putting that hat on right now in this thread lest I hijack it.
aww hell we should just make this the official MR Nerdy Mortgage math thread
ha ha ha
my sad story...bring out the violins
i got more than halfway through an mba in arts administration (a labor of love essentially), with a 3.7 gpa, but ran out of money but i will always value what i took and may return if i can have $15000 come my way that is disposable income
Ouch!ha ha ha
my sad story...bring out the violins
i got more than halfway through an mba in arts administration (a labor of love essentially), with a 3.7 gpa, but ran out of money but i will always value what i took and may return if i can have $15000 come my way that is disposable income
I hate when that happens!
aww hell we should just make this the official MR Nerdy Mortgage math thread
I'd love to participate in a Finance-related sub-Fourm, but I don't think MacRumors is the best place for it.
Ah well, I'm a part of the forex trading thread here at least (although I haven't posted there in a while...)
Oh, dear.
Everything that has gone wrong with my almost 10 year old home has driven me crazy, but it's been on the market for about 1.5 weeks. I signed the paperwork a week ago Sunday. I had 5 showings last week and 3 so far this week and had 1 offer and a silly counter-counter offer that was equal to their first offer. (What was that? We can't count? Don't bet on it.)
Now, mind you, the market is bad compared to 2005 and only those with a stronger financial position are going to get loans now but when sellers are willing to accept reality, I think the market will be decent. It'll be another 10 years before it really looks good again, if ever.
Everything that has gone wrong with my almost 10 year old home has driven me crazy, but it's been on the market for about 1.5 weeks. I signed the paperwork a week ago Sunday. I had 5 showings last week and 3 so far this week and had 1 offer and a silly counter-counter offer that was equal to their first offer. (What was that? We can't count? Don't bet on it.)
Now, mind you, the market is bad compared to 2005 and only those with a stronger financial position are going to get loans now but when sellers are willing to accept reality, I think the market will be decent. It'll be another 10 years before it really looks good again, if ever.
That's the issue here as well. We are in the middle of a huge economic boom and our province is leading the country in practically all economic metrics - as a result, the housing market has gotten silly here - we had over 50% price increases last year. Things are finally starting to cool off now (for how long though who knows...) so once the sellers realize their homes are no longer going to receive 10 offers in the first day and there are no longer going to be bidding wars, they will lower their asking prices to what they should have been listed for initially and then things will hopefully get back to somewhat normal. I'm just glad I bought when I did a couple years ago!
Right.
One of my neighbours with the same model house, while drunk, went on and on to criticise me for pricing my house so low. Of course, they bought at the peak in 2005 and it'll probably take them 20 years to recover their money. That's not my fault, though. However, my house is still worth a bit less than double compared to 10 years ago. Someone down the block has theirs listed for what it was worth in 2005 and even with upgrades, they won't sell it. Putting gold plating on it wouldn't sell it for that price.
As I move to another town, I think the prices are still too high, but apartment rents are far too expensive in comparison in many communities.
Ouch!
I hate when that happens!
it's so many years ago and now i have no aspirations for being a manager or promoter in the entertainment business
at this point in my life, i would not take a job like that if it was offered to me for a huge salary
i did spend a lot of my youth thinking it would be cool to either be in a rock band, or be a roadie, manager/promoter, engineer, or somebody going in a huge tour bus from town to town like a circus
some years before i entered grad school i met a musician who was a professional backup bassist for many solo artists and he spent nearly 20 years on the road, but with no money to show for it but a lot of great stories and more music equipment than anybody could possibly own
anyway, being young then, i still thought that was far cooler than somebody who retired after 20 years of being an accountant or district manager of a fast food chain
.....
but back to the thread
*homes*
in my market, it will definitely take at least a decade to fully recover if one bought at the peak in '05-'06, but maybe longer if we don't get out of this recession in the next few years
people who rented this decade will be very happy they did since the next decade (may) be a great time to buy a home
$60k! For student loans? That's it?
I wish.
My BA cost me 30k. (for two years mind you. I paid the first two out of pocket.)
Now I have 2 years of grad school to pay for. That ends up costing me 10K/semester. I'm hoping that after my first year (30K) I can manage to find some type o job on campus that gives tuition deferments. They tend not to want to give them to first years.
At the end of the day, I could end up owing 90k or 60k. Either way, it's going to have to be refinanced into something that is 20 or 30 years.