What is your current housing situation?

Things that don't belong anywhere else. (Check first).

Moderators: Moderators General, Prelates, Magistrates

What is your current housing situation?

Live for free with family
19
15%
Rent from family
8
6%
Rent a room you share with strangers
0
No votes
Rent your own room in a home shared with strangers
27
21%
Rent an apartment of your own
35
27%
Rent a whole house of your own
7
5%
Own (with mortgage) a home, but rent land (e.g. condo, mobile home, etc)
5
4%
Own (free and clear) a home, but rent land (e.g. condo, mobile home, etc)
1
1%
Own (with mortgage) a home on its own land
25
19%
Own (free and clear) a home on its own land
3
2%
 
Total votes: 130

User avatar
Pfhorrest
Posts: 5484
Joined: Fri Oct 30, 2009 6:11 am UTC
Contact:

Re: What is your current housing situation?

Postby Pfhorrest » Thu May 15, 2014 8:00 pm UTC

There is a cost of upkeep, and food and such, yes, but those are things you can skimp on in hard times. I've had times in my life where I could barely afford to eat for many months on end, and I just... went hungry. It didn't completely derail my entire existence and prevent me from being able to work to get out of that situation. It just meant I had to bear an unpleasant deficit in my quality of life until it ended. If I couldn't afford rent, on the other hand, then BAM one month later I'm out on the street, hiding from the cops (can't sleep/loiter pretty much anywhere) and other malicious strangers, with nowhere to put any of my stuff so all my possessions that I can't carry with me are gone too, and now suddenly I'm on the absolute bottom rung of society and my entire life has collapsed. I'd take "shit I can't afford to fix that leaky roof" over that situation any day.

Of course it's always going to cost to maintain a decent standard of living, but it's the failure modes that I'm concerned about, and without a space that is yours, the failure mode is complete abject poverty. With a space that is yours, the failure mode is you can't keep the lights on or bathe maybe, or fix a leaky roof or broken window, but you've still got a place to sleep and keep your stuff behind a locked door, and that's a huge step up from a backpack and a bush in the back of a park.
Last edited by Pfhorrest on Thu May 15, 2014 8:07 pm UTC, edited 1 time in total.
Forrest Cameranesi, Geek of All Trades
"I am Sam. Sam I am. I do not like trolls, flames, or spam."
The Codex Quaerendae (my philosophy) - The Chronicles of Quelouva (my fiction)

User avatar
JBJ
Posts: 1263
Joined: Fri Dec 12, 2008 6:20 pm UTC
Location: a point or extent in space

Re: What is your current housing situation?

Postby JBJ » Thu May 15, 2014 8:05 pm UTC

Enuja wrote:I don't agree that owning a home is a good safety net. Even if you own a place, you have to pay taxes, you have to pay insurance, and you have to keep paying upkeep. My mom bought a house. And then a hurricane came through and put a tree on her roof. Yes, she had insurance, but homeowner's insurance is not free. It takes money to keep buying food, to buy clean water, and to keep any living situation in a good, supportive society (taxes) and to do the continuous upkeep a safe and secure living place provides. Often, rent is the best and cheapest long term way to pay the inevitable costs of a having a place to live.

Rent is not the cheapest. It's the most predictable and generally the easiest to obtain, but not cheapest. The landlord also has to pay taxes, insurance (not including renter's insurance, which is up to the renter), and upkeep. And all that money comes from the rent. Plus a little extra. You know, for profit and all that. If you do own a house free and clear and suddenly lose all your income so you can't pay taxes, insurance, etc.... you're still sitting on a huge asset. Going by the current median home price of $150,000 and let's go with $1000/mo for rent, that's 12.5 years worth of rent from the sale of the home. That's a damn good safety net. Or if you want to stay in your home, there are reverse mortgages.
So, you sacked the cocky khaki Kicky Sack sock plucker?
The second cocky khaki Kicky Sack sock plucker I've sacked since the sixth sitting sheet slitter got sick.

User avatar
Enuja
Posts: 1576
Joined: Tue Apr 14, 2009 9:40 pm UTC
Location: Chicago, IL
Contact:

Re: What is your current housing situation?

Postby Enuja » Thu May 15, 2014 9:44 pm UTC

I just did some searches, and found evidence that supported my position that home ownership is often a bad financial investment. But they weren't the type of convincing, primary source research that would be likely to convince other people, just "experts" expounding in ways that I agree with. Here's one of them, on Talk of the Nation: (soundbite of laughter" in the transcript is actually the host, Neal Conan, laughing)
Prof. GYOURKO: It depends. Not everyone should own. Some of us should. I do, and I certainly think it was a good decision for me, but it depends. You shouldn't let mortgage interest rates drive your decision. It depends on whether the costs, you know, exceed the benefits of owning. And if they do, you should rent. There are number of costs, besides the fact that you have to pay on a mortgage, pay property taxes, heat your home, fix the roof if it starts to leak.

The other costs that I think are underappreciated by a lot of households have to do with mobility. Owning ties you down. It's an expensive asset, and people live in them for very long time periods of time to defray the costs of owning over a lot of years. And for a lot of people, like me, that's not a big cost because I'm on the wrong side of 50 now.

(Soundbite of laughter)

Prof. GYOURKO: My kids are in the school system that I want them to be in, and I have a very stable job. But if you're young, if you might need to move to opportunity or need to change location to get a better school quality match, maybe you shouldn't be owning because very expensive round trips cost you six to nine percent of house value, just to sell a home and buy a new one. So I think there are a lot of unappreciated costs with owning that would lead some people, if they thought about them more seriously, not to own.

CONAN: But isn't housing a great long-term investment?

Prof. GYOURKO: You know, it is actually not a particularly great long-term investment. The RIOs(ph) are after inflation. So, adjust for inflation, average return in the United States since 1975 has been about one percent a year. So, it's - that's not zero. It's positive. That's a good thing. But it's not a particularly great way to build wealth. You would have done a lot better in a -even a one-year treasury bond index over that period of time, quite frankly. So, financially, no. It's not nearly as good as people think it is.

CONAN: But isn't it the great psychological investment? People have a stake in their community. They're better citizens.

Prof. GYOURKO: Yeah, that I agree with. I think there - and also in a different way then the one you mentioned, I certainly think people have a stake in their community. And I think that can make for better communities. I also think people just like the control of owning their own home. And that's a - there's a pride of ownership, and that's real. So I'm not saying there aren't benefits. There are. And you just mentioned a few. But there are costs. And housing's an expensive, durable good, and durable goods are costly to maintain. And sometimes those costs can make it such that you actually should know.
CONAN: Some people also say, you know, paying rent is just, well, it's just dropping money down a rat hole. You're not getting any return on that money.

Prof. GYOURKO: That - well, there is that myth out there that all my realtor friends tell me all the time...

(Soundbite of laughter)

Prof. GYOURKO: ...that owning saves on your rent. It actually doesn't. And if you think about it, imagine that you could either rent your house or own your house. And if you rented it from some landlord, you would have to write a rent check, and the landlord would use that rent check to cover the costs of owning, to pay for his or her mortgage, the property taxes, the heating bill and the like. All right? Now, if you own the house yourself, you obviously don't write yourself a rent check, because that's a waste of paper.

But you still have to cover all the costs of occupying the house. You just have to do it without a rent check. So, I sort of tell my non-realtor friends: Remember, the landlord you're stiffing when you don't pay yourself a rent check as an owner is yourself. So, you can't save. The operating costs are the same whether you rent or own the house.
I disagree with this guy about one thing: I think if people built social networks of support in living groups, that would create a much more cohesive community than lots of isolated single family homes.

The amount of profit that landlords make is actually fairly small. Most people would end up with more money if they rented, and invested a little bit of money in stocks and bonds, instead of investing in a home. And those savings can be used as a cushion in hard times, just as a house you own can be used as a cushion in hard times. Except if your cushion is cash, instead of a home, it's probably larger and it's definitely more fungible. And a fungible cushion is a good thing.

speising
Posts: 2365
Joined: Mon Sep 03, 2012 4:54 pm UTC
Location: wien

Re: What is your current housing situation?

Postby speising » Thu May 15, 2014 9:58 pm UTC

that's a good point. owning a house is only a safety net because it represents a value. a value which you had to purchase first. if you don't invest your money into real estate, you keep it in your bank account, to invest it anywhere else.
if you mortgage, well, banks only give you money for securities, and if you're broke they'll take those securities, probably the house itself, away from you.
so, owning a house is really only safer in that you can't easily loose it all in las vegas or spend it on booze.

User avatar
WilliamTheConqueror
Posts: 245
Joined: Thu Nov 08, 2012 10:16 pm UTC
Location: *tips meme*

Re: What is your current housing situation?

Postby WilliamTheConqueror » Thu May 15, 2014 10:19 pm UTC

I'm currently living with my parents, but I'm 16, so it's not uncommon. Once I'm in college and not living in the dorms I'll just rent an apartment with some friends. I don't think I'll ever actually own a house, though. Too much money, and I'd rather a landlord be responsible for fixing stuff than me, because I'm crap at it and really lazy. :/
addams wrote:Fucking Nature.

Tomlidich the second wrote:You cannot surgically graft enough middle fingers to my body to express how fed up I am with this.

User avatar
Pfhorrest
Posts: 5484
Joined: Fri Oct 30, 2009 6:11 am UTC
Contact:

Re: What is your current housing situation?

Postby Pfhorrest » Thu May 15, 2014 10:22 pm UTC

speising wrote:owning a house is only a safety net because it represents a value.

And the absence of a continued expense. It cuts off a continuous debt that you would otherwise pay forever. That's my primary concern. I don't care about having a house that's worth a lot of money as an investment that I can leverage at a later date (and it rather pisses me off that other people so flippantly treat such an important basic necessity of life as nothing more than a means to get rich, pushing it further out of the reach of the people who just need it as an end in itself in the process). I just care about being able to fall flat on my ass income-wise and not lose all of my assets in the process, unless I choose to sell them off for money.

Of course if you don't actually own a house outright and are just mortgaging it, you're still at risk of losing everything if you lose your income, but you're at least on the way to that kind of security. And yeah you have to pour a lot of money that might otherwise go into another kind of safety net to acquire that security, and you risk losing all of that money too if you lose the house because you lost your income before you finished paying for it. It's a big expense and a big risk, to get something so simple and basic. That's my complaint. There should be a cheap and safe way to just get some kind of basic foothold in the world quickly when you're young. And upgrade from there as suits your needs and your means. But everyone deserves a little something of their own.
Forrest Cameranesi, Geek of All Trades
"I am Sam. Sam I am. I do not like trolls, flames, or spam."
The Codex Quaerendae (my philosophy) - The Chronicles of Quelouva (my fiction)

User avatar
Pfhorrest
Posts: 5484
Joined: Fri Oct 30, 2009 6:11 am UTC
Contact:

Re: What is your current housing situation?

Postby Pfhorrest » Thu May 15, 2014 10:23 pm UTC

WilliamTheConqueror wrote:I'd rather a landlord be responsible for fixing stuff than me, because I'm crap at it and really lazy. :/

You know you don't actually have to do the work yourself. Your landlord likely won't do the work himself either. You can pay someone else to do it, just like a landlord would. Why not cut out the middle man if you can?
Forrest Cameranesi, Geek of All Trades
"I am Sam. Sam I am. I do not like trolls, flames, or spam."
The Codex Quaerendae (my philosophy) - The Chronicles of Quelouva (my fiction)

User avatar
WilliamTheConqueror
Posts: 245
Joined: Thu Nov 08, 2012 10:16 pm UTC
Location: *tips meme*

Re: What is your current housing situation?

Postby WilliamTheConqueror » Thu May 15, 2014 11:04 pm UTC

Pfhorrest wrote:
WilliamTheConqueror wrote:I'd rather a landlord be responsible for fixing stuff than me, because I'm crap at it and really lazy. :/

You know you don't actually have to do the work yourself. Your landlord likely won't do the work himself either. You can pay someone else to do it, just like a landlord would. Why not cut out the middle man if you can?


You... Have a point. That's probably a smarter idea.

However, renting an apartment in the town where I'm going to be living is actually cheaper than owning a house there in the long run. Plus, if I need to move for some reason I won't have to worry about selling a house!!
addams wrote:Fucking Nature.

Tomlidich the second wrote:You cannot surgically graft enough middle fingers to my body to express how fed up I am with this.

User avatar
Jorpho
Posts: 6290
Joined: Wed Dec 12, 2007 5:31 am UTC
Location: Canada

Re: What is your current housing situation?

Postby Jorpho » Fri May 16, 2014 3:39 am UTC

Pfhorrest wrote:You know you don't actually have to do the work yourself. Your landlord likely won't do the work himself either. You can pay someone else to do it, just like a landlord would. Why not cut out the middle man if you can?
Eh, you'd have to hunt that someone else down, you'd have to make sure he was reputable, and you'd probably have to stick around to be there whenever he shows up. I think all the maintenance stuff in my apartment building is handled by the same friendly, competent, timely maintenance personnel, and I never see a bill for anything they need to do.

I'm very pleased with my apartment; I've been stuck in some crappy ones before. That's why I don't want to buy a condo – I might end up in a bad situation, and then I'd have to sell or rent the condo, and I'd probably lose a substantial amount of money in the process.

User avatar
Ormurinn
Posts: 1033
Joined: Tue Apr 03, 2012 3:42 pm UTC
Location: Suth Eoferwicscire

Re: What is your current housing situation?

Postby Ormurinn » Fri May 16, 2014 11:44 am UTC

Jorpho wrote:
Pfhorrest wrote:You know you don't actually have to do the work yourself. Your landlord likely won't do the work himself either. You can pay someone else to do it, just like a landlord would. Why not cut out the middle man if you can?
Eh, you'd have to hunt that someone else down, you'd have to make sure he was reputable, and you'd probably have to stick around to be there whenever he shows up. I think all the maintenance stuff in my apartment building is handled by the same friendly, competent, timely maintenance personnel, and I never see a bill for anything they need to do.


The flip side of this is you'd get to control the quality of work done. About once a month or so the landlords plumber comes and worries at our piping, because subdividing the house was done on the cheap and the piping leaks. Furniture is constantly breaking.

In the long run the landlord would save money hiring competent people. But then since renting student housing is a licence to print money, the business doesn't weed out people who only think short term.
"Progress" - Technological advances masking societal decay.

Chen
Posts: 5580
Joined: Fri Jul 25, 2008 6:53 pm UTC
Location: Montreal

Re: What is your current housing situation?

Postby Chen » Fri May 16, 2014 12:20 pm UTC

Pfhorrest wrote:And the absence of a continued expense. It cuts off a continuous debt that you would otherwise pay forever. That's my primary concern. I don't care about having a house that's worth a lot of money as an investment that I can leverage at a later date (and it rather pisses me off that other people so flippantly treat such an important basic necessity of life as nothing more than a means to get rich, pushing it further out of the reach of the people who just need it as an end in itself in the process). I just care about being able to fall flat on my ass income-wise and not lose all of my assets in the process, unless I choose to sell them off for money.

Of course if you don't actually own a house outright and are just mortgaging it, you're still at risk of losing everything if you lose your income, but you're at least on the way to that kind of security. And yeah you have to pour a lot of money that might otherwise go into another kind of safety net to acquire that security, and you risk losing all of that money too if you lose the house because you lost your income before you finished paying for it. It's a big expense and a big risk, to get something so simple and basic. That's my complaint. There should be a cheap and safe way to just get some kind of basic foothold in the world quickly when you're young. And upgrade from there as suits your needs and your means. But everyone deserves a little something of their own.


This might have something to do with how easy/hard it is to evict a tenant. It's quite a process to do that here. I'm fairly comfortable that I could miss 2 months of rent and still not have the process started to evict me. Not to mention I could likely just pay the 2 months back rent at any hearing and likely get to keep the lease (though it likely wouldn't be renewed the next year). The laws here are very tenant friendly. As such, the "safety" in renting vs owning is not all that different. If I don't pay my property taxes or my school taxes I'm going to run into similar problems. If I skimp on maintenance I may not run into immediate problems but I definitely increase the risk of a catastrophic failure in the house which could render it unliveable (say a roof collapsing with no money set aside to fix it). And this is of course not including the length of time it takes to actually purchase the house. At which point its basically just like paying rent. I don't know too many people who actually pay off their house in even 10 years. The mortgage lengths now are generally a lot longer than that, especially since the rates are very low. Putting extra payments onto my mortgage of ~2.9% seems pretty inefficient compared to just flat out investing it in the market (or paying off higher percentage debts).

Tyndmyr
Posts: 11443
Joined: Wed Jul 25, 2012 8:38 pm UTC

Re: What is your current housing situation?

Postby Tyndmyr » Fri May 16, 2014 1:45 pm UTC

Pfhorrest wrote:Of course it's always going to cost to maintain a decent standard of living, but it's the failure modes that I'm concerned about, and without a space that is yours, the failure mode is complete abject poverty. With a space that is yours, the failure mode is you can't keep the lights on or bathe maybe, or fix a leaky roof or broken window, but you've still got a place to sleep and keep your stuff behind a locked door, and that's a huge step up from a backpack and a bush in the back of a park.


The big issue is taxes. If you fail to pay your power bill, you have no power, but...you still have something. If you fail to pay taxes for long enough, seizures can happen. Then, you're essentially in the same place, out on the street. The failure mode there is rough. Taxes in my area usually runs to many thousands of dollars per year, enough to be a serious impediment to low income home ownership(even if prices already weren't).

Home ownership CAN be really good...or not. I mean, it kind of is an asset, but it's a place to live first and foremost. Your car isn't a good investment in terms of resale value, but owning one can be great for your quality of life. Homes are similar(if less extreme). And renting isn't a good investment at all. You have to live SOMEWHERE.

Pfhorrest wrote:
speising wrote:owning a house is only a safety net because it represents a value.

And the absence of a continued expense. It cuts off a continuous debt that you would otherwise pay forever. That's my primary concern. I don't care about having a house that's worth a lot of money as an investment that I can leverage at a later date (and it rather pisses me off that other people so flippantly treat such an important basic necessity of life as nothing more than a means to get rich, pushing it further out of the reach of the people who just need it as an end in itself in the process). I just care about being able to fall flat on my ass income-wise and not lose all of my assets in the process, unless I choose to sell them off for money.


The principle you advocate is solid...reducing recurring expenses to a minimum let's you cope with income variation. It's a little discouraging sometimes how much of a paycheck just vanishes automatically for recurring bills. Sometimes, I dream about self-generating power, septic system, etc so bills are essentially nil. The issue is, setting this up is far from cheap.

Also, speculation isn't really driving home prices at the moment. At least, in the US. It totally *did*, but after the bubble, people got cautious again. People are still more wary about buying. The big thing determining price is...homes are expensive to build. Also, local land prices. Right now, building homes isn't the best of industries in terms of profit, and it totally is a good place to be when speculation is rampant.

User avatar
ahammel
My Little Cabbage
Posts: 2135
Joined: Mon Jan 30, 2012 12:46 am UTC
Location: Vancouver BC
Contact:

Re: What is your current housing situation?

Postby ahammel » Fri May 16, 2014 2:11 pm UTC

speising wrote:owning a house is only a safety net because it represents a value.
The thing is that the pile of money which you exchange for the house also represents a value.

I would not feel comfortable at all if my house was my only significant investment. Strikes me as an "eggs in one basket" kind of situation.
He/Him/His/Alex
God damn these electric sex pants!

User avatar
Brace
Posts: 1169
Joined: Wed Jul 15, 2009 5:40 am UTC
Location: Denver, Co
Contact:

Re: What is your current housing situation?

Postby Brace » Fri May 16, 2014 2:40 pm UTC

This post had objectionable content.
Last edited by Brace on Mon Oct 06, 2014 12:52 am UTC, edited 1 time in total.
"The future is the only kind of property that the masters willingly concede to the slaves" - Albert Camus

speising
Posts: 2365
Joined: Mon Sep 03, 2012 4:54 pm UTC
Location: wien

Re: What is your current housing situation?

Postby speising » Fri May 16, 2014 3:45 pm UTC

ahammel wrote:
speising wrote:owning a house is only a safety net because it represents a value.
The thing is that the pile of money which you exchange for the house also represents a value.

I would not feel comfortable at all if my house was my only significant investment. Strikes me as an "eggs in one basket" kind of situation.


yes. which is basically what my next two sentences said.

User avatar
JBJ
Posts: 1263
Joined: Fri Dec 12, 2008 6:20 pm UTC
Location: a point or extent in space

Re: What is your current housing situation?

Postby JBJ » Fri May 16, 2014 5:46 pm UTC

Right, having a home doesn't exclude having other investments. The nice thing about a home, even with a mortgage, is that you are building equity with every payment. With rent, not so. Rent only goes to cover living expenses for the period in which it is paid. Pay one month's rent, get one month's shelter. Pay one month's mortgage, get one month's shelter AND some portion of your payment goes towards equity. What you don't get back is interest (although you can deduct interest on your income taxes in many cases), property taxes, and insurance. I wouldn't necessarily include maintenance and upkeep as that helps retain the value of the home. In some cases it can't be recouped. Others it can.

Another advantage is that mortgage payments always stay the same (at least for fixed rate). Rent will increase over time. An apartment I used to rent 15 years ago was $560 per month. Now it's $699. That's only a 1.7% per year average increase. Not much, and probably just keeping up with inflation. Mortgages are immune to inflation. A $560 mortgage payment 15 years ago will be a $560 mortgage payment today. Paying more (by choice) as your income grows only builds equity faster.

So owning a home does have a number of financial advantages, as long as you're in a position to take advantage of them. If not, they can be financially ruinous. Rent is easier to manage, for sure. It's more predictable and the renter is not assuming any of the risk of owning the property. Ownership does come with risk. But risk also comes with reward.
So, you sacked the cocky khaki Kicky Sack sock plucker?
The second cocky khaki Kicky Sack sock plucker I've sacked since the sixth sitting sheet slitter got sick.

speising
Posts: 2365
Joined: Mon Sep 03, 2012 4:54 pm UTC
Location: wien

Re: What is your current housing situation?

Postby speising » Fri May 16, 2014 5:58 pm UTC

the mortgage payment will be higher than the rent for a home of comparable quality, though. so the correct calculation would be mortgage on one side, and rent plus savings in the other.

User avatar
JBJ
Posts: 1263
Joined: Fri Dec 12, 2008 6:20 pm UTC
Location: a point or extent in space

Re: What is your current housing situation?

Postby JBJ » Fri May 16, 2014 6:21 pm UTC

Huh? If the landlord holds a mortgage on a rental house, they are going to have the same expenses as someone who is mortgaging their own house. And unless the landlord is willing to rent "at cost", they're going to tack on a few extra dollars to the rent. That may hold true for a landlord that doesn't hold a mortgage on their rental property. In which case they're just expanding their profit margin because they can undercut all the other rental owners whose properties are mortgaged.
So, you sacked the cocky khaki Kicky Sack sock plucker?
The second cocky khaki Kicky Sack sock plucker I've sacked since the sixth sitting sheet slitter got sick.

speising
Posts: 2365
Joined: Mon Sep 03, 2012 4:54 pm UTC
Location: wien

Re: What is your current housing situation?

Postby speising » Fri May 16, 2014 6:36 pm UTC

don't forget the capital. mortgage is basically rent plus payback of the loaned amount.

it's a fact. for the rent i'm paying now, i could buy a hovel.

User avatar
JBJ
Posts: 1263
Joined: Fri Dec 12, 2008 6:20 pm UTC
Location: a point or extent in space

Re: What is your current housing situation?

Postby JBJ » Fri May 16, 2014 7:30 pm UTC

Well, yeah. The interest being paid on the loan is essentially rent to the homeowner. That and taxes and insurance. Basically, any money paid to live there that you don't get back in equity or value. I already said that.

Depending on the rate and term, the ratio of "rent" to "capital" will vary. In a low interest, 10 or 15 year mortgage, the "rent" portion is a smaller part, and will continue to get smaller as the loan progresses. For a 15 year, 4% loan, it starts out at 55/45 principal to interest. Halfway through, it's 68/32, and in the last year it's 98/2. Longer loan term, yeah it gets worse. On a 30 year fixed at 4%, is 30/60 principle to interest to start. It doesn't get to 50/50 until about 13 years in. You can wind up paying twice as much or more of the value of the house just in interest. Not a good situation, and one I wouldn't recommend anyone get in unless it's just to float payments temporarily while waiting on the sale of another home or something to pay for the current one. And don't get me started on interest only loans...

There are financial benefits if you go into home ownership prepared, knowing what to expect, and working it to your advantage.

For a 15 year, 4% mortgage of a $150,000 house paid on schedule, the cumulative interest is going to be about $50,000 ($49,715.40 to be precise). If we consider the interest the "rent", that averages out to be $276.20 per month in rent. Holy shit, I'd love to have that as a rental rate. Not to mention that now I've got a $150,000 asset, not including appreciation. It would take 15.5 years of putting $276.20 a month into an investment returning a reliable 12% to reach $150,000 just by investing. Which is money I wouldn't be able to put towards housing.
So, you sacked the cocky khaki Kicky Sack sock plucker?
The second cocky khaki Kicky Sack sock plucker I've sacked since the sixth sitting sheet slitter got sick.

speising
Posts: 2365
Joined: Mon Sep 03, 2012 4:54 pm UTC
Location: wien

Re: What is your current housing situation?

Postby speising » Fri May 16, 2014 7:38 pm UTC

that's actually in the ballpark of what i thought. i pay about double that in rent, and an equivalent flat would cost about 250000 eur.

User avatar
cplns
Posts: 213
Joined: Mon Apr 08, 2013 4:23 am UTC
Location: l'astéroïde B612

Re: What is your current housing situation?

Postby cplns » Fri May 16, 2014 8:08 pm UTC

25 years old, on medical leave from college, living for free with mother and sister in a rented apartment. Because of my health issues, both of my parents support me financially, including living arrangements. I wish I could be independent enough to live on my own, but as it's not possible right now, I've learned to accept it.

User avatar
Pfhorrest
Posts: 5484
Joined: Fri Oct 30, 2009 6:11 am UTC
Contact:

Re: What is your current housing situation?

Postby Pfhorrest » Fri May 16, 2014 9:16 pm UTC

@JBJ, your kind of reasoning is what I'm on about. (That's me agreeing with you).

I'm paying $500/mo for land rent on what is essentially a stand-alone one-bedroom apartment (just for a way to describe the kind of space and privacy I have in my mobile home). That is a way better deal than what I was getting for the same $500/mo I used to pay for a just bedroom in a shared house, and all the money I was saving was saving up to buy a house eventually anyway, so for me, dropping those savings to buy this mobile home was a no-brainer. (Plus I got the place below market value anyway, though I'm not sure how far below, and then appreciation just adds to that).

Given current 15yr interest rates of 3.22%, that means I could borrow up to $500*12/0.0322=$186335.40 before the interest rate would exceed my current rent. Payments on the principle would then be $186335.40/(15*12)=$1035.20/mo, which is about the rate at which I am saving right now. Given that everything I'm saving is just saving up to buy a house eventually anyway, it's almost a no-brainer to take up such a deal, if I could find it. The 'almost' is because I want to be putting aside more money to I can recover from unexpected expenses too, but just finding a slightly cheaper place to I can still save something fixes that problem. So let's say I'm aiming to borrow about $160k, which would actually lower my "rent" (interest, which actually is rent [on money] anyway) and the amount of my savings I'd have to dedicate toward building equity to something I could afford.

The difficulty for me is finding something for under $160k/0.8=$200k (because 20% down) that's neither (A) Very far away from home, where I've always lived, where everyone and everything I care about is, and which sets my standards for what a decent place to live is; (B) In some kind of atrociously horrible place that's not so far away, like the middle of a desert, or Oildale (which is like it sounds: nothing but oilfields in the middle of nowhere); nor (C) In a decrepit dilapidated state that I won't be able to put any money into repairing until after the mortgage is paid off in 15 years. And that seems to be really hard to find.

If I could find that, I would buy it in a heartbeat. Or well, in a couple years when I can save up the $200k*0.2=$40k needed to put 20% down. Failing that... assuming work stays stable and I don't have some kind of unexpected catastrophe, I'd just have to stay in this mobile home for 15 years until I have enough savings that I can put 50% down on the $400k starter homes that aren't so scarce around here. And then finally start paying off a 15 year mortgage, at around age 47... which might leave me 5 years before retirement to start saving up for that, yay fuck the California housing market :(
Forrest Cameranesi, Geek of All Trades
"I am Sam. Sam I am. I do not like trolls, flames, or spam."
The Codex Quaerendae (my philosophy) - The Chronicles of Quelouva (my fiction)

Chen
Posts: 5580
Joined: Fri Jul 25, 2008 6:53 pm UTC
Location: Montreal

Re: What is your current housing situation?

Postby Chen » Mon May 19, 2014 3:17 pm UTC

Your calculations are not taking taxes into account. For an apartment or home that you're renting, there are also maintenance issues handled by the landlord that don't show up on your rent, not to mention heating/hot water/electricity depending on what you got included in your rent.

As Speising said, for what I was paying in rent prior to buying a place, if I wanted the exact same payments per month, I'd be living in a shack, if I didn't want to move out of the city. This seems to be more of an issue in big cities. The building I used to rent in was old and probably already paid off. The landlord needed to only charge enough to cover taxes and maintenance, with a little profit on top to come out ahead. This was significantly lower than what it would take to buy a condo that was similar sized. I know this because there was a condo for sale in one of the exact same buildings next door to the one I was renting from. The mortgage payment on it + property taxes would have likely been double the amount being paid to rent it, forget the fact that my rent in those buildings included heating and hot water, which presumably I'd have to have paid if I bought the place.

speising
Posts: 2365
Joined: Mon Sep 03, 2012 4:54 pm UTC
Location: wien

Re: What is your current housing situation?

Postby speising » Mon May 19, 2014 3:23 pm UTC

of course, utility costs are always in addition. when discussing rent, i've always thought of the base rent without costs an owner has to pay, too. in our billing, those have to be shown separately anyway.

User avatar
Yablo
Posts: 636
Joined: Thu Feb 02, 2012 9:57 am UTC
Location: Juneau, Alaska

Re: What is your current housing situation?

Postby Yablo » Mon May 19, 2014 7:25 pm UTC

My wife and I rent a house. My sister-in-law, her husband, and their two kids moved to Alaska from Arizona, and they are staying with us. The theory is that they would help with rent and bills until they find a place, but the reality is starting to look more like buying food for the house in exchange for two bedrooms, and half of the garage. If someone had told me a few years ago that this would be my situation, I would probably have been very opposed to it, but as it stands now I actually don't mind much. With the exception of a baby flipping the switch on my surge protector, or disrupting the organization of my bookshelf, I have little to complain about.
If you like Call of Cthulhu and modern government conspiracy, check out my Delta Green thread.
Please feel free to ask questions or leave comments.

User avatar
Bloopy
Posts: 220
Joined: Wed May 04, 2011 9:16 am UTC
Location: New Zealand

Re: What is your current housing situation?

Postby Bloopy » Tue May 20, 2014 1:20 am UTC

Own my own apartment/condo with a mortgage in Auckland, NZ. One bedroom, live by myself. I'm with a few other users in that the terminology "rent land" in the poll doesn't quite fit me, since the building is on freehold land. My unit title is effectively a small share in the land title. What I do pay goes towards upkeep of the building, insurance, administration etc.

Mortgage + body corporate fees + council rates/taxes is about NZ$325 per week currently, and the mortgage is 75% of that. The more I pay my mortgage down, the cheaper it gets, give or take interest rate variations. In the end I have something to show for it. No landlords who might want to kick me out and use it themselves. If I was renting at that price here, I'd be lucky to get either a car park or a bedroom much bigger than the bed, and the cost is just going to keep rising. So from my point of view, if you're ever potentially able to climb the initial hurdle and buy your own place which you'd like to settle down in, go for it.

User avatar
PhoenixEnigma
Posts: 2303
Joined: Fri Sep 18, 2009 3:11 am UTC
Location: Sasquatchawan, Canada
Contact:

Re: What is your current housing situation?

Postby PhoenixEnigma » Tue May 20, 2014 3:16 am UTC

The rule of thumb I've heard is that if you're paying more than 1% of the purchase price of your domicile in rent, it makes more sense to buy. If you can rent for under 1% the purchase price, it makes sense to do so, once interest, repairs, taxes and everything else is factored in. I'm currently paying something like 0.5% of of what I'd need to spend for a 1 bedroom condo in this city on rent every month because selling prices have been going nuts for the past decade here, but rentals haven't shot up nearly as much. I'm better off sticking the difference in a TFSA until that gap narrows a lot (from either side), even if you discount the fact that the mobility is important to me - I expect to be moving soon enough that any equity I'd build would be wiped out by closing costs when I moved anyways.
"Optimism, pessimism, fuck that; we're going to make it happen. As God is my bloody witness, I'm hell-bent on making it work." -Elon Musk
Shivahn wrote:I am a motherfucking sorceror.

User avatar
Pfhorrest
Posts: 5484
Joined: Fri Oct 30, 2009 6:11 am UTC
Contact:

Re: What is your current housing situation?

Postby Pfhorrest » Tue May 20, 2014 3:22 am UTC

PhoenixEnigma wrote:1% of the purchase price of your domicile in rent

Per what time period?
Forrest Cameranesi, Geek of All Trades
"I am Sam. Sam I am. I do not like trolls, flames, or spam."
The Codex Quaerendae (my philosophy) - The Chronicles of Quelouva (my fiction)

User avatar
PhoenixEnigma
Posts: 2303
Joined: Fri Sep 18, 2009 3:11 am UTC
Location: Sasquatchawan, Canada
Contact:

Re: What is your current housing situation?

Postby PhoenixEnigma » Tue May 20, 2014 3:29 am UTC

Pfhorrest wrote:
PhoenixEnigma wrote:1% of the purchase price of your domicile in rent
Per what time period?
Per month, sorry.
"Optimism, pessimism, fuck that; we're going to make it happen. As God is my bloody witness, I'm hell-bent on making it work." -Elon Musk
Shivahn wrote:I am a motherfucking sorceror.

User avatar
ucim
Posts: 6892
Joined: Fri Sep 28, 2012 3:23 pm UTC
Location: The One True Thread

Re: What is your current housing situation?

Postby ucim » Tue May 20, 2014 4:13 am UTC

Pfhorrest wrote:That's my complaint. There should be a cheap and safe way to...
rephrased, it comes out like "Society should give me a cheap and safe way to..." and while that would be nice, I'm not convinced that society (which means "everyone else") should have an obligation to provide everything that would be nice to have.

JBJ wrote:The nice thing about a home, even with a mortgage, is that you are building equity with every payment. With rent, not so.
... but, as has been said, it generally costs more to service a mortgage and other ancillary costs than to pay rent on equivalent property. If the difference would go towards beer, you're better off buying. But if the difference would go towards other investments, then you simply weigh one investment (real estate) against another (stocks, bonds, education, whatever), taking taxes into consideration, and factoring in things like security vs. flexibility. The point is no one answer is the "right" answer for everyone.

This leads to another option - buy a multifamily home and rent the other units out. It's not a gimme, but getting other people to pay your mortgage is not a bad idea. The flip side is that you just got yourself a job. Can you handle another job?

JBJ wrote:You can wind up paying twice as much or more of the value of the house just in interest
But "future money" is not as valuable as "present money".

Pfhorrest wrote:If I could find that, I would buy it in a heartbeat.
... so would everybody else. :)

One thing I'm struck by (I never really gave it much thought although I've been exposed to it) is the wide variety of housing situations that exist, both on the needs and the solutions sides. I'm glad all these options are available.

Jose
Order of the Sillies, Honoris Causam - bestowed by charlie_grumbles on NP 859 * OTTscar winner: Wordsmith - bestowed by yappobiscuts and the OTT on NP 1832 * Ecclesiastical Calendar of the Order of the Holy Contradiction * Heartfelt thanks from addams and from me - you really made a difference.

User avatar
Yablo
Posts: 636
Joined: Thu Feb 02, 2012 9:57 am UTC
Location: Juneau, Alaska

Re: What is your current housing situation?

Postby Yablo » Tue May 20, 2014 7:24 pm UTC

ucim wrote:But "future money" is not as valuable as "present money".

That's not technically always true though. Depending on various factors including interest rates, inflation, and time, the future value could actually be much greater.
If you like Call of Cthulhu and modern government conspiracy, check out my Delta Green thread.
Please feel free to ask questions or leave comments.

User avatar
Brace
Posts: 1169
Joined: Wed Jul 15, 2009 5:40 am UTC
Location: Denver, Co
Contact:

Re: What is your current housing situation?

Postby Brace » Tue May 20, 2014 8:21 pm UTC

This post had objectionable content.
Last edited by Brace on Mon Oct 06, 2014 12:51 am UTC, edited 1 time in total.
"The future is the only kind of property that the masters willingly concede to the slaves" - Albert Camus

stickler
Posts: 85
Joined: Sun Jan 01, 2012 12:40 pm UTC

Re: What is your current housing situation?

Postby stickler » Wed May 21, 2014 12:30 am UTC

As a uni student I am in a shared house with friends which is about £325 per month.

One day I want to build (with help) my own house, so I will need to own the land. This could be expansive expensive.
Last edited by stickler on Wed May 21, 2014 1:44 pm UTC, edited 1 time in total.

User avatar
ucim
Posts: 6892
Joined: Fri Sep 28, 2012 3:23 pm UTC
Location: The One True Thread

Re: What is your current housing situation?

Postby ucim » Wed May 21, 2014 4:11 am UTC

Yablo wrote:
ucim wrote:But "future money" is not as valuable as "present money".
That's not technically always true though. Depending on various factors including interest rates, inflation, and time, the future value could actually be much greater.
Yes, you are right, although that doesn't happen often. Also, I am not using the technical term "future value" (of a given amount of present money), but rather, in the colloquial "I'll give you ten dollars today, or ten dollars ten years from now" sense.
stickler wrote:One day I want to build (with help) my own house, so I will need to own the land. This could be expansive.
Expensive too, especially if the land is expansive. :)

Jose
Order of the Sillies, Honoris Causam - bestowed by charlie_grumbles on NP 859 * OTTscar winner: Wordsmith - bestowed by yappobiscuts and the OTT on NP 1832 * Ecclesiastical Calendar of the Order of the Holy Contradiction * Heartfelt thanks from addams and from me - you really made a difference.

User avatar
Diadem
Posts: 5654
Joined: Wed Jun 11, 2008 11:03 am UTC
Location: The Netherlands

Re: What is your current housing situation?

Postby Diadem » Wed May 21, 2014 9:30 am UTC

I'm confused by the 'own a condo but rent the land' option. Is that common abroad?

Over here when you buy an apartment you generally buy shared-ownership of the entire building. You don't rent anything, you co-own it with everybody else living there. Owning property on rent land does exist, but it's rare. Such rent is then usually 'erfpacht', which means it's perpetual and inheritable, so that practically it's pretty much he same as owning the land.

I take it in the US things work differently?
It's one of those irregular verbs, isn't it? I have an independent mind, you are an eccentric, he is round the twist
- Bernard Woolley in Yes, Prime Minister

User avatar
SecondTalon
SexyTalon
Posts: 26529
Joined: Sat May 05, 2007 2:10 pm UTC
Location: Louisville, Kentucky, USA, Mars. HA!
Contact:

Re: What is your current housing situation?

Postby SecondTalon » Wed May 21, 2014 2:17 pm UTC

I don't know how it'd work with a condo as you usually own the four walls and, while you aren't renting "Land", you may have to rent a parking space and likely pay some sort of monthly or annual fee for lawncare and the like, but if you own a trailer, you might be renting the land it's on.
heuristically_alone wrote:I want to write a DnD campaign and play it by myself and DM it myself.
heuristically_alone wrote:I have been informed that this is called writing a book.

Tyndmyr
Posts: 11443
Joined: Wed Jul 25, 2012 8:38 pm UTC

Re: What is your current housing situation?

Postby Tyndmyr » Wed May 21, 2014 3:56 pm UTC

Diadem wrote:I'm confused by the 'own a condo but rent the land' option. Is that common abroad?

Over here when you buy an apartment you generally buy shared-ownership of the entire building. You don't rent anything, you co-own it with everybody else living there. Owning property on rent land does exist, but it's rare. Such rent is then usually 'erfpacht', which means it's perpetual and inheritable, so that practically it's pretty much he same as owning the land.

I take it in the US things work differently?


It's essentially buying an apartment. Common area maint fees, etc are a thing, and this effectively forms a rent. Nobody's going to actually say you need to move your condo off the land, because this is usually wildly impractical, but neither do you have exclusive rights to any land to change as you wish. It's almost a halfway point between renting and buying, really.

It's a thing, but it's not extremely common. We have a lot of straight renters and homeowners too. Hell, even condos don't all work the same. Some DO have a tiny patch of land that's exclusively yours, not rented. Lots of variety in possible arrangements.

User avatar
Enuja
Posts: 1576
Joined: Tue Apr 14, 2009 9:40 pm UTC
Location: Chicago, IL
Contact:

Re: What is your current housing situation?

Postby Enuja » Wed May 21, 2014 4:14 pm UTC

In the market I live in (Chicago), the "condominium assessment fee," what you pay for your share of building upkeep, a reserve fund for major expenses (new roof, ect), heat if there's just one boiler in the building, maybe a door person, and other things, is often a good fraction of what rent for a simliar apartment would be. Condo assessments run from about $100 a month to around $600, with many being about $350 a month. Right now, I'm paying $412 a month in rent. Which tells you something about how financially undesirable owning would be, for me, here in Chicago. And like rent, condo fees go up over time. Since Phforrest is interested in reducing his ongoing expenses, condo fees probably seem very analogous to land rent (a unwanted fee that doesn't go away when you buy something), so he put them in the same category in the poll.

User avatar
slinches
Slinches get Stinches
Posts: 1036
Joined: Tue Mar 26, 2013 4:23 am UTC

Re: What is your current housing situation?

Postby slinches » Wed May 21, 2014 7:14 pm UTC

On the whole mortgage interest cost subject, if you have the income to afford the payments, the rates on a 10yr fixed loan can be as low or lower than the rate of inflation. Since you're paying them back with inflated dollars, they're essentially paying you to use their money. Great deal, if you can make it happen. With good timing and some help from family in the mortgage industry, that's the situation I'm in now.

Pfhorrest, I think a big part of your problem with housing affordability is that you're in CA. I have some family there and that state is just unreasonably expensive to live in, especially if you work in a major city (LA, SF, San Diego, heck even Sacramento). Rural areas on the other side of the central valley aren't too bad on price, but taxes, fees and utilities are all still very expensive. I'm in Phoenix with a salary approaching six figures, which I can live on quite comfortably (2000 ft^2 house on a 1/3 acre lot in the city, <30 min. commute to downtown). To get anything resembling that in LA or the bay area, I'd need to be making at least 3x what I do now.

And for reference, I'm about the same age as you are. Also, my sister is a teacher making ~$35k and she just recently bought a small (~1100 ft^2, on a 30yr fixed loan) house just a couple of miles away from mine. Interestingly (hah!) she'll end up paying almost as much as I will overall if we both continue to pay our monthly mortgage payments until the end of the term.


Return to “General”

Who is online

Users browsing this forum: No registered users and 28 guests