Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

victor wrote:
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

true... in my case, its about even.

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time

all depends... my mortgage is about $400 *less* than a comparable
2br/2ba apartment, with indoor laundry and a garage.

you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN

not necessarily... i could probably make double payments now, if i
wanted. that would pay it off in about 10 years or so.

APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.



3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price.

the price you sell at is set by what comparable properties sell for. if
the selling price of similar houses goes up, yours does too.

Assuming that the neighborhood doesn't go down the
tubes.

dude, i already live in "the tubes". theres nowhere to go but up from
here, and this place has *still* appreciated $100k in a little over 2
years.

even when the rates rise, and prices fall, they ARENT going to fall $100k.

granted, thats a "paper profit", but it entitles me to have more
options, if i need them. home equity loans (which are stupid ), or even
the chance to get the hell out of here and have a $100k down payment on
a house somewhere else cheaper in the southwest, if and when the time
comes.

do you have that with your apartment? no.

Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

mine did. i made a full price offer with the stipulation that the seller
pay closing cost. they did. total out of pocket? $6000 down payment,
which came off the selling price, and a $150 home inspection.

you only get screwed if you WANT to get screwed.



4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

is it really? how much does your rent go up each year? my payments will
be the same 30 years from now as they are today. will your rent
payments? i doubt it. no such thing as FREE, chachi. and if i pay it off
early? its mine. youll still be paying rent forever.


In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

yes, they should just let you wallow in your happiness. sounds more like
sour grapes on your part, than them being "holier than thou".

"victor" wrote in message
news
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

Last year, after refinancing (and dramatically reducing my interest paid), I
the tax I save on my interest payment is 25% more than my real estate tax.
In 2002, prior to refinancing, it was 80% more.


2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

2&3 kinda go together - to benefit, you don't have to wait until the
mortgage is completely paid off. I've been in my house 5 years & I have 23%
equity, above the balance on the mortgage. To reduce the risk of the
neighbourhood depreciating & to pay off the mortgage quicker, you.....errr
pay the mortgage off quicker - take a 15,20 or 25 year mortgage (or just
take a 30 year mortgage & make double payments when you can - although you
probably won't get as good a rate, that way)..


4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

I'm an exempt employee (software integration engineer) for my company - I
work as many hours as it takes, to get the job done - last year I averaged
between 60 & 70 hours a week, 2 weeks out of every 4 on call, about 20
business trips & yes - my house needed cleaning. But the total maintenance
was replacing a roof tile ($60) & replacing a water heater with a blown
element ($0 - under warranty). I also did some painting myself ($25 for
paint).


In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

Before I bought my house, I lived in 11 different apartments & 2 condos in 8
years. I've been a renter and been a buyer & (for me) there's no comparison.
Not sure how old you are - but if you feel that a mortgage will take forever
to pay off, you might be quite young - I'm 41YO & the remaining 14 years on
my mortgage seems like a few days. I'm in the process of buying land to
build a $400,000 home - I'll probably end up with a 30 year mortgage for
that (in 30 years I'll be 71).

It may be that buying a house isn't for you - but it is for me, that's all I
can say. And I've met far more people, that were glad they bought, rather
than regretted it.

victor wrote:
|| Ok, ok, ok. My friends and family keep nagging at me to stop renting
|| and buy a house. I'm so sick of them droning on about points-this
|| and closing costs-that. But the more I think about, the less sense
|| it seems to make for me. Here's why:
||
|| 1. "You'll save a fortune on taxes." True. But the property taxes
|| will pretty much cancel out any savings you got on the income taxes.
||
|| 2. "You're throwing rent money down the toilet." True. In all
|| likelihood, your mortgage payment will be twice your rent. By the
|| time you pay it off, you'll be drinking Ensure, wearing Depends, and
|| too old to maintain the house. Then you'll be wanting to move back
|| to ... AN APARTMENT! By that time, an assisted living apartment.
|| And let's be realistic. You're NOT going to be like those power
|| couples in Money magazine who claim they're going to pay off the
|| mortgage in 5 years and retire in 10. Yeah, right.
||
|| 3. "It's one of the few things you buy that appreciate in value."
|| Assuming that you find someone who is willing to pay your inflated
|| selling price. Assuming that the neighborhood doesn't go down the
|| tubes. Assuming that the new house you buy will end costing as much
|| as you think it's going to (not!). Too many assumptions.
||
|| 4. Maintenance. I'm lucky if I have time to clean my apartment, let
|| alone a house. I've worked customer service for plumbing, HVAC, and
|| home maintenance companies before, and I hear how much people pay for
|| this stuff. In an apartment, it's all FREE.
||

Earth to dodo...it's in the rent which goes up if these costs escalate.




|| In the end, I suppose it's a matter of personal preference. But I do
|| wish my home-owning friends would cut out the holier-than-thou
|| attitude.

Rufio wrote:
|| "victor" wrote in message
|| news ||| Ok, ok, ok. My friends and family keep nagging at me to stop
||| renting and buy a house. I'm so sick of them droning on about
||| points-this and closing costs-that. But the more I think about,
||| the less sense it seems to make for me. Here's why:
|||
||| 1. "You'll save a fortune on taxes." True. But the property taxes
||| will pretty much cancel out any savings you got on the income taxes.
||
|| Last year, after refinancing (and dramatically reducing my interest
|| paid), I the tax I save on my interest payment is 25% more than my
|| real estate tax. In 2002, prior to refinancing, it was 80% more.
||
|||
||| 2. "You're throwing rent money down the toilet." True. In all
||| likelihood, your mortgage payment will be twice your rent. By the
||| time you pay it off, you'll be drinking Ensure, wearing Depends,
||| and too old to maintain the house. Then you'll be wanting to move
||| back to ... AN APARTMENT! By that time, an assisted living
||| apartment. And let's be realistic. You're NOT going to be like
||| those power couples in Money magazine who claim they're going to
||| pay off the mortgage in 5 years and retire in 10. Yeah, right.
|||
||| 3. "It's one of the few things you buy that appreciate in value."
||| Assuming that you find someone who is willing to pay your inflated
||| selling price. Assuming that the neighborhood doesn't go down the
||| tubes. Assuming that the new house you buy will end costing as
||| much as you think it's going to (not!). Too many assumptions.
||
|| 2&3 kinda go together - to benefit, you don't have to wait until the
|| mortgage is completely paid off. I've been in my house 5 years & I
|| have 23% equity, above the balance on the mortgage. To reduce the
|| risk of the neighbourhood depreciating & to pay off the mortgage
|| quicker, you.....errr pay the mortgage off quicker - take a 15,20 or
|| 25 year mortgage (or just take a 30 year mortgage & make double
|| payments when you can - although you probably won't get as good a
|| rate, that way)..
||
|||
||| 4. Maintenance. I'm lucky if I have time to clean my apartment,
||| let alone a house. I've worked customer service for plumbing,
||| HVAC, and home maintenance companies before, and I hear how much
||| people pay for this stuff. In an apartment, it's all FREE.
||
|| I'm an exempt employee (software integration engineer) for my
|| company - I work as many hours as it takes, to get the job done -
|| last year I averaged between 60 & 70 hours a week, 2 weeks out of
|| every 4 on call, about 20 business trips & yes - my house needed
|| cleaning. But the total maintenance was replacing a roof tile ($60)
|| & replacing a water heater with a blown element ($0 - under
|| warranty). I also did some painting myself ($25 for paint).
||
|||
||| In the end, I suppose it's a matter of personal preference. But I
||| do wish my home-owning friends would cut out the holier-than-thou
||| attitude.
||
|| Before I bought my house, I lived in 11 different apartments & 2
|| condos in 8 years. I've been a renter and been a buyer & (for me)
|| there's no comparison. Not sure how old you are - but if you feel
|| that a mortgage will take forever to pay off, you might be quite
|| young - I'm 41YO & the remaining 14 years on my mortgage seems like
|| a few days. I'm in the process of buying land to build a $400,000
|| home - I'll probably end up with a 30 year mortgage for that (in 30
|| years I'll be 71).

As a houseowner myself, WHAT THE HELL is the point of spending THAT much for
a house when it takes you THAT long to pay it off? People can't understand
why, since we have paid off our mortgage, don't take out a NEW mortgage and
"move on up". Thanks to OUR attitude, I was able to 80% retire at the age of
42 and my wife will be entirely retired at 55. Guess you want to keep on
working those 60 to 70 hour weeks. Enjoy the rat race.



||
|| It may be that buying a house isn't for you - but it is for me,
|| that's all I can say. And I've met far more people, that were glad
|| they bought, rather than regretted it.

A couple comments....

When you rent, your landlord still has to pay property taxes,
mortgage, maintenance, deal with less than 100% occupancy and/or
deadbeat tenants, and make a profit besides. Do you think those
expenses aren't just getting passed on to the tenants? When you buy
your own home, you at least cut out the expense of the middleman.

The second thing is lifestyle; you have more choices and control when
you buy rather than rent. I bought my first house, for instance,
because I was having a lot of trouble finding a nice rental that would
allow me to have pets (2 indoor cats, in my case).

-Sandra

"SHARX" wrote in message
news:rCPHc.14958$Rf.13054@edtnps84...
Rufio wrote:
|| "victor" wrote in message
|| news ||| Ok, ok, ok. My friends and family keep nagging at me to stop
||| renting and buy a house. I'm so sick of them droning on about
||| points-this and closing costs-that. But the more I think about,
||| the less sense it seems to make for me. Here's why:
|||
||| 1. "You'll save a fortune on taxes." True. But the property taxes
||| will pretty much cancel out any savings you got on the income taxes.
||
|| Last year, after refinancing (and dramatically reducing my interest
|| paid), I the tax I save on my interest payment is 25% more than my
|| real estate tax. In 2002, prior to refinancing, it was 80% more.
||
|||
||| 2. "You're throwing rent money down the toilet." True. In all
||| likelihood, your mortgage payment will be twice your rent. By the
||| time you pay it off, you'll be drinking Ensure, wearing Depends,
||| and too old to maintain the house. Then you'll be wanting to move
||| back to ... AN APARTMENT! By that time, an assisted living
||| apartment. And let's be realistic. You're NOT going to be like
||| those power couples in Money magazine who claim they're going to
||| pay off the mortgage in 5 years and retire in 10. Yeah, right.
|||
||| 3. "It's one of the few things you buy that appreciate in value."
||| Assuming that you find someone who is willing to pay your inflated
||| selling price. Assuming that the neighborhood doesn't go down the
||| tubes. Assuming that the new house you buy will end costing as
||| much as you think it's going to (not!). Too many assumptions.
||
|| 2&3 kinda go together - to benefit, you don't have to wait until the
|| mortgage is completely paid off. I've been in my house 5 years & I
|| have 23% equity, above the balance on the mortgage. To reduce the
|| risk of the neighbourhood depreciating & to pay off the mortgage
|| quicker, you.....errr pay the mortgage off quicker - take a 15,20 or
|| 25 year mortgage (or just take a 30 year mortgage & make double
|| payments when you can - although you probably won't get as good a
|| rate, that way)..
||
|||
||| 4. Maintenance. I'm lucky if I have time to clean my apartment,
||| let alone a house. I've worked customer service for plumbing,
||| HVAC, and home maintenance companies before, and I hear how much
||| people pay for this stuff. In an apartment, it's all FREE.
||
|| I'm an exempt employee (software integration engineer) for my
|| company - I work as many hours as it takes, to get the job done -
|| last year I averaged between 60 & 70 hours a week, 2 weeks out of
|| every 4 on call, about 20 business trips & yes - my house needed
|| cleaning. But the total maintenance was replacing a roof tile ($60)
|| & replacing a water heater with a blown element ($0 - under
|| warranty). I also did some painting myself ($25 for paint).
||
|||
||| In the end, I suppose it's a matter of personal preference. But I
||| do wish my home-owning friends would cut out the holier-than-thou
||| attitude.
||
|| Before I bought my house, I lived in 11 different apartments & 2
|| condos in 8 years. I've been a renter and been a buyer & (for me)
|| there's no comparison. Not sure how old you are - but if you feel
|| that a mortgage will take forever to pay off, you might be quite
|| young - I'm 41YO & the remaining 14 years on my mortgage seems like
|| a few days. I'm in the process of buying land to build a $400,000
|| home - I'll probably end up with a 30 year mortgage for that (in 30
|| years I'll be 71).

As a houseowner myself, WHAT THE HELL is the point of spending THAT much
for
a house when it takes you THAT long to pay it off? People can't understand
why, since we have paid off our mortgage, don't take out a NEW mortgage
and
"move on up". Thanks to OUR attitude, I was able to 80% retire at the age
of
42 and my wife will be entirely retired at 55. Guess you want to keep on
working those 60 to 70 hour weeks. Enjoy the rat race.


Simple answer - because it's what I want. I asked myself a question a couple
of years ago "Given a choice, where in the city (Metro Phoenix, Arizona)
would I build a house" - this is IT. The major cost is the land. I WAS
planning on retiring in a few years (at 45YO). But I chose to push that back
to get the house I want, in the location I want. I will almost certainly
make double payments most of the time - I just may not be able to get a 15
year mortgage right now.

I'm single with no dependents - I plan on spending my income on what I
enjoy. Too many people save & save & save......and never spend their savings
on the things they enjoy (it makes the reading of the will exciting though)
This can be either an investment OR a house to retire in. I have plenty of
money in the stock market right now, but it's not doing much. I could sell
this new house in 8-10 years & I conservatively project 40-50% growth - not
a huge gain, but pretty safe & not too shabby either.

I bet I STILL retire before the age of 60.

P.S. The new house has a clear view for 12 miles across the roof line of
Phoenix as far North as Squaw Peak mountain, and it backs on to Phoenix
South Moutain Park. It's awesome.

"victor" wrote in message
news
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.


Many people seem to parrot that idea. You need to run the numbers. The
standard deduction (what you can deduct from taxes even if you had no
expenses)is pretty high.



2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

"victor" wrote in message
news
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

this has no effect on me - i think with other tax exemtions we still benefit

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

my home will be paid off when I am 45. We bought at 27, refinanced to a 15
year. I pay 1 extra payment a year and it knocks 2 years off my mortgage!

My mortgage payment IS twice what my rent was...BUT...my apartment was
attached to someone elses home, I had no yard and I only had 3 rooms and a
bathroom. My house has a wonderful yard, 8 rooms, 2 bathrooms, an attic and
a basement. I think it's worth it to raise my family in a beautiful home in
a beautiful area.

I am going to start a vegetable garden this summer (well to plant in next
spring), I have swingset and bird baths. I don't think you can have all this
in an apt. If you rent a house it costs the same as a mort. payment and then
you have to wait for your landlord to come jiggle the handle when your
toilet is running!


3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.


if you choose carefully you should be ok - our home has more than doubled
it's value in 5 years.

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.


Well, I guess you are qualified to jiggle your own toilet handle But
really, you still are at the mercy of others.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

ok - to each his own but i don't think the home-owners are trying to get you
to join the "crazy home-owner cult" - i think they have also lived in
apartments and see the benefits of owning a home.


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Checked by AVG anti-virus system (http://www.grisoft.com).
Version: 6.0.713 / Virus Database: 469 - Release Date: 6/30/2004

"victor" wrote in message
news
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

I'm over 50 and looking at moving from apartment to house with a 30 year
mortgage. I'd prefer to stay in an apartment and let someone else worry
about all the maintenance issues. The apartment I rented 20 years ago,
however, is now renting for 3 times what I paid. If the same trend
continues, my rent is going to be close to $3,000 per month in 20 years. I
can't afford not to buy a house.

On Sat, 10 Jul 2004 05:19:06 -0400, victor
wrote:

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

That is where I disagree with you. There are not too many
assumptions. History has shown us the appreciation of real estate and
with a little bit of thinking about where/what you buy, you are too
quick to dismiss the single largest investment asset that most people
will ever own.

On Sat, 10 Jul 2004 05:19:06 -0400, victor wrote:

Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

There are many pros and cons to buying a house and there is no quick answer; it
is a lifestyle question as much as an economic one. However, the property tax
offset is bogus because as a renter you still pay the property taxes. You just
don't get to deduct them.

victor wrote in message ...
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

You'd have to run the numbers, but in my case, buying enabled me to
raise the number of exemptions I take from 2 to 9 and substantially
increase the net amount of my paycheck. I have more money available. I
suppose lots of people use this extra money to pay the mortgage. I
didn't - I kept with a reasonable mortgage payment, keep some of it to
give me a cushion each month, and stuff the rest into 401K. Before
buying, I could not afford to contribute to 401K.

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent.

Not in my case. My rent kept going up year after year, sucking up any
raise increase I got. I bought a house in which the mortgage payment +
taxes + insurance equalled what I was paying in rent, but it will
never go up from here on out. Any future raises will be gravy.

By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment.

Yep, and you can sell the house to afford that assisted living
apartment. We know a couple who bought a house in 1965 for $25,000.
Today it's worth $640,000, despite the fact that in recent years it
has not been well maintained. (It would get another $100K or so if it
was in better condition, but $640 is still nothing to sneeze at).

And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

True if you're looking at short term timeline. Not true if you
consider long term. If you're not in the position to settle down and
commit to one neighborhood for longer than 7 years, I wouldn't advise
buying (particularly with your attitude about it).

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

Shrug. My landlord was really stingy and let the place go to hell. He
only paid for what was absolutely necessary - the bare minimum of
maintenance. I got tired of living in a dump.

Besides, you could always consider a condo and pay an association fee
to have someone else do all the maintenance.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

How old are you? Are you settled in a relatively secure job with
stable income? Do you like the area where you live? I think these are
key questions. No, home buying is not for everyone.

jen

"victor" wrote in message
news
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

You're indirectly paying for property taxes when you rent. The cost is
included in the rent, where it's non-deductible on your Federal tax return.
There's at least the possibility that you'll be able to deduct property
taxes on your return if you buy.

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent.

That depends on what you buy and what you were renting. In my personal
experience, the mortgage payment - principle, interest, taxes, insurance,
and PMI - totalled less over the ten years I was in that house than the
total rent over those then years would have been had I stayed in my last
apartment. And that was before taking tax effects into account. And when I
sold the place and paid everything off, I got all of that money back.

By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment.

If you're lucky, you'll live long enough to be drinking Ensure and wear
Depends whether you buy or rent. If you bought, at that time you can sell
the place and use the proceeds to finance that assisted living apartment.
If you rent, you're going to have to save up that money in addition to your
rent.

And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

Probably not. But I don't see how that leaves you any worse off than if you
rent, where you'll be making those monthly payments for the rest of your
life.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

If you buy and some years later you decide to sell, you generally get at
least some of your money back. Not always, granted. But in a statistical
sense, residential real estate is the second soundest investment in America.
The first is stocks.

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

NOTHING is free - the price is included in your rent.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

Practice what you preach.

(shinypenny) wrote:

Not in my case. My rent kept going up year after year, sucking up any
raise increase I got. I bought a house in which the mortgage payment +
taxes + insurance equalled what I was paying in rent, but it will
never go up from here on out. Any future raises will be gravy.

Uhhh, don't expect that. Insurance in Florida skyrocketed after hurricane
Andrew, and contines to go up. Property taxes here were rising so fast that
many seniors had to sell their homes. That one got capped locally with a
constitutional ammendment capping property tax increases to 2% per year. Most
places don't have that safeguard.

Many people make the mistake of treating this as a purely financial
decision, when it should be much more of a lifestyle decision. A few
sites that might help -

http://www.bankrate.com/brm/news/rea...-rent-quiz.asp

http://biz.yahoo.com/pfg/e10buyrent

http://www.economics.pomona.edu/Gary...ms/houses.html

SoCalMike wrote:


is it really? how much does your rent go up each year? my payments will
be the same 30 years from now as they are today. will your rent
payments? i doubt it. no such thing as FREE, chachi. and if i pay it off
early? its mine. youll still be paying rent forever.


Actually, your payment will be substantially higher due to
property tax increases, assuming you live outside of California
that is. I co-owned a house with my father back in the 80's,
and during those 7 years the house payment (which included
payments into an escrow account for taxes and insurance) went
up from $645 to almost $900, a better than 35% increase. I
can assure you that the family income did not increase by
anywhere near the same amount in that time.

I worked out a formula once that included among other items
the interest paid over the life of the loan, and determined
that it was very unlikely that a house could be sold for
what the interest alone cost, and that was in spite of the
interest deduction.

That being said, the median house price around here is 5.5x
the average annual income and rising.

JazzMan
--
************************************************** ********
Please reply to jsavage"at"airmail.net.
Curse those darned bulk e-mailers!
************************************************** ********
"Rats and roaches live by competition under the laws of
supply and demand. It is the privilege of human beings to
live under the laws of justice and mercy." - Wendell Berry
************************************************** ********

Sandra Loosemore wrote in message ...
A couple comments....

When you rent, your landlord still has to pay property taxes,
mortgage, maintenance, deal with less than 100% occupancy and/or
deadbeat tenants, and make a profit besides. Do you think those
expenses aren't just getting passed on to the tenants? When you buy
your own home, you at least cut out the expense of the middleman.

The second thing is lifestyle; you have more choices and control when
you buy rather than rent. I bought my first house, for instance,
because I was having a lot of trouble finding a nice rental that would
allow me to have pets (2 indoor cats, in my case).

If you had to move tomorrow, how would having to go through the time
and expense of selling your home give you more choices and control?

I've seen this scenario played out a 1/2 dozen or more times in my
neighborhood. Wal-Mart big shot comes to town and buys home. 2
or 3 years later he/she is transferred to another state and
is making payments on the home left behind as well as their new
place of residence. The house across the street sat empty/for sale
for 2 years after one Wal-Mart family moved.

JazzMan wrote:
SoCalMike wrote:


is it really? how much does your rent go up each year? my payments will
be the same 30 years from now as they are today. will your rent
payments? i doubt it. no such thing as FREE, chachi. and if i pay it off
early? its mine. youll still be paying rent forever.



Actually, your payment will be substantially higher due to
property tax increases, assuming you live outside of California
that is. I co-owned a house with my father back in the 80's,
and during those 7 years the house payment (which included
payments into an escrow account for taxes and insurance) went
up from $645 to almost $900, a better than 35% increase. I
can assure you that the family income did not increase by
anywhere near the same amount in that time.

I worked out a formula once that included among other items
the interest paid over the life of the loan, and determined
that it was very unlikely that a house could be sold for
what the interest alone cost, and that was in spite of the
interest deduction.

But you didn't take into account the rent you weren't paying.
To get an realistic estimate of what it actually cost you need
to subtract your typical rent payment over the years from your PIT.

/dan

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

These savings are touted by almost everyone. The mortgage interest
you pay currently counts as a tax deduction. This translates to maybe
20 cents of tax savings on every dollar that you pay. Don't buy a
house just for the tax savings because you'll be paying several times
that in interest!

2. "You're throwing rent money down the toilet."

Some people are advocating that you take your money out of your house
(sell) and rent for a while because housing prices are so high. This
is speculative, but if you have six-figure appreciation on your house
(which my wife's aunt just got after owning her Northern VA house for
only three years!) that covers ten years' renting! It's not always
throwing money down the toilet to rent; sometimes it's good not to own
something and just to lease it.


3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

This is true. Things are often riskiest when everyone thinks that
appreciation is a sure thing. Home prices can, and do, go down --
sometimes a lot.


4. Maintenance....

Heat pumps are big things to go. It's worth it for us now to continue
our home buyers' warranty -- $300/year with a $50 deductible to
replace the heat pump if it goes.


In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

Home ownership vs. renting does have pros and cons both sides. If the
hassle of home ownership is too much, then there's no real reason to
buy if you're not ready. You're also exposing yourself to the real
estate market by buying a house, which does have the potential to cost
you a lot of money if for some reason you have to sell in a hurry and
prices are depressed.

In short, it's not cut and dried that home ownership is the best thing
for everyone, and you have to look at your own situation to make a
good decision.

mbh


----------------------------
Spend less the easy way!
www.mightybargainhunter.com

wrote:
(shinypenny) wrote:

Not in my case. My rent kept going up year after year, sucking up any
raise increase I got. I bought a house in which the mortgage payment
+ taxes + insurance equalled what I was paying in rent, but it will
never go up from here on out. Any future raises will be gravy.

Uhhh, don't expect that. Insurance in Florida skyrocketed after
hurricane Andrew, and contines to go up. Property taxes here were
rising so fast that many seniors had to sell their homes. That one
got capped locally with a constitutional ammendment capping property
tax increases to 2% per year. Most places don't have that safeguard.

Um, actually the Save Our Homes act (Amendment 10) limits homesteaded
property tax increases in Florida to 3% or the percentage change in the
Consumer Price Index, whichever is lower.

Dan Ganek wrote:

JazzMan wrote:
SoCalMike wrote:


is it really? how much does your rent go up each year? my payments will
be the same 30 years from now as they are today. will your rent
payments? i doubt it. no such thing as FREE, chachi. and if i pay it off
early? its mine. youll still be paying rent forever.



Actually, your payment will be substantially higher due to
property tax increases, assuming you live outside of California
that is. I co-owned a house with my father back in the 80's,
and during those 7 years the house payment (which included
payments into an escrow account for taxes and insurance) went
up from $645 to almost $900, a better than 35% increase. I
can assure you that the family income did not increase by
anywhere near the same amount in that time.

I worked out a formula once that included among other items
the interest paid over the life of the loan, and determined
that it was very unlikely that a house could be sold for
what the interest alone cost, and that was in spite of the
interest deduction.

But you didn't take into account the rent you weren't paying.
To get an realistic estimate of what it actually cost you need
to subtract your typical rent payment over the years from your PIT.

/dan

Rent prices around here tend to say within the same general
range as house payments for equivalent sizes, with the rent
being a little higher most of the time. Unless one pays cash
for a house there will always be a payment due every month for
shelter. Being in a house is better than an apartment from the
sense that a house may or may not break even over the life of
the mortgage, but rent is a total loss. From a strict sense of
just cash outlay from the monthly budget it's a wash either way.

JazzMan
--
************************************************** ********
Please reply to jsavage"at"airmail.net.
Curse those darned bulk e-mailers!
************************************************** ********
"Rats and roaches live by competition under the laws of
supply and demand. It is the privilege of human beings to
live under the laws of justice and mercy." - Wendell Berry
************************************************** ********

"Travis Jordan" wrote:

wrote:
(shinypenny) wrote:

Not in my case. My rent kept going up year after year, sucking up any
raise increase I got. I bought a house in which the mortgage payment
+ taxes + insurance equalled what I was paying in rent, but it will
never go up from here on out. Any future raises will be gravy.

Uhhh, don't expect that. Insurance in Florida skyrocketed after
hurricane Andrew, and contines to go up. Property taxes here were
rising so fast that many seniors had to sell their homes. That one
got capped locally with a constitutional ammendment capping property
tax increases to 2% per year. Most places don't have that safeguard.

Um, actually the Save Our Homes act (Amendment 10) limits homesteaded
property tax increases in Florida to 3% or the percentage change in the
Consumer Price Index, whichever is lower.

M'I bad. You're right. Without it, the fiscal responsibility of Broward and
Miami Dade governments would probably be worse than they are now. I voted for
it, and given a chance I'll vote for the ammendment that proposes to increase
the homestead exemption to more fairly represent actual values. Home ownership
implies a greater interest in politics and public spending, as well as almost
always assuring at least a couple of bouts of jury duty.

On Sat, 10 Jul 2004 05:19:06 -0400, victor
wrote:

Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

Okay first, not everyone should buy a house, its something everyone
has to think about for themselves. Its not up to your friends and
family, its up to you, this is not a one size fits all thing

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

Depends on where you live. I live in northern virginia and this is
not true once I take all my deductions

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

I dont know where you are, but where I live, rents for the house
similar to mine is much more than my mortage. Why?? Because they need
to make a profit. So the guy down the street renting his house is
charging x......my mortage is less. We saved money by buying a home,
once we realized that we would be there for awhile.

Aslo, in my house, I can paint the walls any color I want, remove the
carpet and strip the floors, knock walls out. Make ungodly holes in
the wall instead of only using little picture hooks, and so on. This
is important to us, as we wanted something that was ours. We are also
the home is castle types, and spend much of our free time there.

The above is, I think the main reason we bougth. That and the desire
for permaancy. A landlord (which we are at the moment) can decide to
sell the house, can decide to come and live in the house, can
arbitrarily raise the rent.

So If you think you want to stay in one place, and put down roots for
any period of time, then buying a home iw worth considering.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

Depends on hwere you live. Where I live, home prices only go up or
stay the same, they wont be going down. Its an established older
neighborhood,

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.
Umm no, its included in the rent as part of the cost. Granted it is a
regular amount. And as the costs of such things increase, rent
increases. Nothing is free.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

Tell them when and if you want to buy a house, youll let th em know.

To live in.

"JazzMan" wrote in message ...
SoCalMike wrote:


is it really? how much does your rent go up each year? my payments will
be the same 30 years from now as they are today. will your rent
payments? i doubt it. no such thing as FREE, chachi. and if i pay it off
early? its mine. youll still be paying rent forever.


Actually, your payment will be substantially higher due to
property tax increases, assuming you live outside of California
that is. I co-owned a house with my father back in the 80's,
and during those 7 years the house payment (which included
payments into an escrow account for taxes and insurance) went
up from $645 to almost $900, a better than 35% increase. I
can assure you that the family income did not increase by
anywhere near the same amount in that time.

Sure, but rent increases at the same rate too,
because the landlord has to pay those property taxes.

I worked out a formula once that included among
other items the interest paid over the life of the loan,
and determined that it was very unlikely that a house
could be sold for what the interest alone cost, and
that was in spite of the interest deduction.

And the reality for those who have actually bought a house is that
that isnt seen that often, specially in these low interest rate times.

That being said, the median house price around
here is 5.5x the average annual income and rising.

And that relative increase isnt seen by those who
rent. THEY get to see their rent hike to pay for that.

"victor" wrote in message news
2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house.

Not necessarily. You don't have to wait until you own it free and clear
to recover your money. I resold my first house 10 years after I bought
it and got back every penny in taxes, principal, interest, and maintenance
I had ever put into it. ...And then some.

If you compare similar housing units-
houses-to-houses or condos-to-apartments, the monthly cost of
renting is probably higher than buying.

What you pay for by renting is the freedom to move out at the
end of the lease. If you want more freedom, you can pay more on
a monthly basis, or go to a hotel and pay more by the day, or go
to a motel and pay more by the hour.

Don

wrote:
"Travis Jordan" wrote:

wrote:
(shinypenny) wrote:

Not in my case. My rent kept going up year after year, sucking up
any raise increase I got. I bought a house in which the mortgage
payment + taxes + insurance equalled what I was paying in rent,
but it will never go up from here on out. Any future raises will
be gravy.

Uhhh, don't expect that. Insurance in Florida skyrocketed after
hurricane Andrew, and contines to go up. Property taxes here were
rising so fast that many seniors had to sell their homes. That one
got capped locally with a constitutional ammendment capping property
tax increases to 2% per year. Most places don't have that
safeguard.

Um, actually the Save Our Homes act (Amendment 10) limits homesteaded
property tax increases in Florida to 3% or the percentage change in
the Consumer Price Index, whichever is lower.

M'I bad. You're right. Without it, the fiscal responsibility of
Broward and Miami Dade governments would probably be worse than they
are now. I voted for it, and given a chance I'll vote for the
ammendment that proposes to increase the homestead exemption to more
fairly represent actual values. Home ownership implies a greater
interest in politics and public spending, as well as almost always
assuring at least a couple of bouts of jury duty.

I'm not sure that the proposed amendment to raise the homestead
exemption by 25K per home is a good idea. I'd encourage you to look
into this a little bit before you vote for it - in order to maintain
revenue taxes will simply shift to those with "higher priced" homes - by
my estimate around 300K seems to be the valuation above which you could
expect to pay higher taxes. Since Amendment 10 applies to market
valuation, not to tax rates there isn't any law to prevent the
municipalities from simply raising rates to make up for the lost income.
Which of course they will do. I don't see that information anywhere in
the hoo-hah publicity touting the increased homestead exemption. In
fact, the web site for the proponents says that taxing authorities
already have a 'windfall' from increasing property values so they don't
need any more money. Of course, how silly of me.

"Don K" wrote:
Not necessarily. You don't have to wait until you own it free and clear
to recover your money. I resold my first house 10 years after I bought
it and got back every penny in taxes, principal, interest, and maintenance
I had ever put into it. ...And then some.

Maybe so (calculation of ROI on a house can be pretty complex), but I
hope folks realize this is not something to expect, given the
long-term history of housing prices...

wrote:

(shinypenny) wrote:


Not in my case. My rent kept going up year after year, sucking up any
raise increase I got. I bought a house in which the mortgage payment +
taxes + insurance equalled what I was paying in rent, but it will
never go up from here on out. Any future raises will be gravy.


Uhhh, don't expect that. Insurance in Florida skyrocketed after hurricane
Andrew, and contines to go up. Property taxes here were rising so fast that
many seniors had to sell their homes. That one got capped locally with a
constitutional ammendment capping property tax increases to 2% per year. Most
places don't have that safeguard.

that also applies to landlords who own apartments, and they raise rents
accordingly.

If you buy and some years later you decide to sell, you generally get at
least some of your money back. Not always, granted. But in a statistical
sense, residential real estate is the second soundest investment in America.
The first is stocks.

for the past 4 years, real estate has kicked stocks ass. its good to
have both. and if youre locked in to a 15 or 30, that means more money
for the 401k!

JazzMan wrote:

SoCalMike wrote:


is it really? how much does your rent go up each year? my payments will
be the same 30 years from now as they are today. will your rent
payments? i doubt it. no such thing as FREE, chachi. and if i pay it off
early? its mine. youll still be paying rent forever.



Actually, your payment will be substantially higher due to
property tax increases, assuming you live outside of California
that is. I co-owned a house with my father back in the 80's,
and during those 7 years the house payment (which included
payments into an escrow account for taxes and insurance) went
up from $645 to almost $900, a better than 35% increase. I
can assure you that the family income did not increase by
anywhere near the same amount in that time.


rent will likely do the same. unless apartments arent subject to
property tax.

I worked out a formula once that included among other items
the interest paid over the life of the loan, and determined
that it was very unlikely that a house could be sold for
what the interest alone cost, and that was in spite of the
interest deduction.

That being said, the median house price around here is 5.5x
the average annual income and rising.


which means a good time to have gotten in would have been yesterday, or
3 years ago. i couldnt afford to live where i do now if i had to buy now.

JazzMan

If you had to move tomorrow, how would having to go through the time
and expense of selling your home give you more choices and control?

for me, id be able to make a 100k down payment on a new place. not
possible if i was renting. and you can sell with the stipulation that
your closing runs concurrently with the closing of the property you are
buying.

I've seen this scenario played out a 1/2 dozen or more times in my
neighborhood. Wal-Mart big shot comes to town and buys home. 2
or 3 years later he/she is transferred to another state and
is making payments on the home left behind as well as their new
place of residence. The house across the street sat empty/for sale
for 2 years after one Wal-Mart family moved.

they either overpaid, or never should have bought in the first place.

if you are likely to move withing a few years, why bother buying? thats
the only instance it might be better to hedge your bets and not buy. me?
ill be here for a while.

hopefully, eventually, mister walmart will be at a place they like and
want to stay there.

now, if walmart is so draconian that they threaten to fire you if you
dont transfer, well, theyre a sucky company anyway.

mightybargainhunter wrote:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.


These savings are touted by almost everyone. The mortgage interest
you pay currently counts as a tax deduction. This translates to maybe
20 cents of tax savings on every dollar that you pay. Don't buy a
house just for the tax savings because you'll be paying several times
that in interest!

look at the bottom line... you pay rent regardless, and that goes up.


2. "You're throwing rent money down the toilet."


Some people are advocating that you take your money out of your house
(sell) and rent for a while because housing prices are so high. This
is speculative, but if you have six-figure appreciation on your house
(which my wife's aunt just got after owning her Northern VA house for
only three years!) that covers ten years' renting! It's not always
throwing money down the toilet to rent; sometimes it's good not to own
something and just to lease it.

then after 10 years? youre back to paying rent. if shes planning on
dying before then, she can live it up!



3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.


This is true. Things are often riskiest when everyone thinks that
appreciation is a sure thing. Home prices can, and do, go down --
sometimes a lot.

just like everything else. i think were getting close to max property
values now.



4. Maintenance....


Heat pumps are big things to go. It's worth it for us now to continue
our home buyers' warranty -- $300/year with a $50 deductible to
replace the heat pump if it goes.



In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.


Home ownership vs. renting does have pros and cons both sides. If the
hassle of home ownership is too much, then there's no real reason to
buy if you're not ready. You're also exposing yourself to the real
estate market by buying a house, which does have the potential to cost
you a lot of money if for some reason you have to sell in a hurry and
prices are depressed.

In short, it's not cut and dried that home ownership is the best thing
for everyone, and you have to look at your own situation to make a
good decision.

if you arent going anywhere, its better to buy while youre there.

Steve wrote:

"Don K" wrote:

Not necessarily. You don't have to wait until you own it free and clear
to recover your money. I resold my first house 10 years after I bought
it and got back every penny in taxes, principal, interest, and maintenance
I had ever put into it. ...And then some.


Maybe so (calculation of ROI on a house can be pretty complex), but I
hope folks realize this is not something to expect, given the
long-term history of housing prices...


long term? values have risen. short term? values have risen
astronomically. in fact, i think theyre probably peaking right now. less
than a mile from me, a 3 bedroom in a "brady bunch" looking neighborhood
is on the market for $750k. thats three quarters of a friggin million
bucks.

that would likely take a combined income of $225k/yr to afford. so after
all the doctors, lawyers, and nurses have bought their homes, whats
left? who can afford these places?

"Travis Jordan" wrote:

I'm not sure that the proposed amendment to raise the homestead
exemption by 25K per home is a good idea. I'd encourage you to look
into this a little bit before you vote for it - in order to maintain
revenue taxes will simply shift to those with "higher priced" homes - by
my estimate around 300K seems to be the valuation above which you could
expect to pay higher taxes. Since Amendment 10 applies to market
valuation, not to tax rates there isn't any law to prevent the
municipalities from simply raising rates to make up for the lost income.
Which of course they will do. I don't see that information anywhere in
the hoo-hah publicity touting the increased homestead exemption. In
fact, the web site for the proponents says that taxing authorities
already have a 'windfall' from increasing property values so they don't
need any more money. Of course, how silly of me.

I understand that concern, but I'm not sure that it applies. The raising of
property tax rates would most directly affect _new_ home buyers of houses
valued at $300K or more, and thus cool the real estate market to a point that
would be unacceptable, especially now that it appears interest rates may rise.
Just like in "Sim City" higher tax rates equate to slower growth (a gross
oversimplification, but generally true).

However, the current cap on increases is _not_ affected, and since the yearly
tax increases for current property owners already come at or close to the legal
limit, from what I've experienced, the new amendment would still have a
positive effect for long-term home owners unless the tax rates went totally
wild. In essence, I would pay less property tax, and new purchasers of more
expensive properties would pay more property tax. While I don't have a serious
problem with the ethics of that, I don't think that it will play out that way -
either in general statewide, or on a local level - where our town has been
fiscally responsible.

The proposed amendment will more likely result in county add-ons to the sales
tax, and increased property taxes upon commercial property, including
apartments. Broward is currently about the only county without an added county
sales tax, so that first part is almost a given where I live. Since businesses
have increasingly been allowed tax concessions to locate in a town, I don't
take issue with their taxes going up.

The un-needed "windfall" propaganda is just propaganda that can be dismissed
out of hand, but I do feel that a realistic homestead exemption is in the best
interest of fixed income seniors and those who struggle to keep their property,
and that the adjustment is only fair. Inflation, which is what this is really
about, is a hidden tax that politicians don't have to answer for.

Whereas the save-our-homes amendment now has an increasing effect of slowing
the musical chairs style of real estate sales here, and improving the feel of
community, I see the new amendment less as a quality of life issue and more as
a redistribution of the tax burden that more accurately reflects current day
valuations. I certainly respect that not everyone feels this way.

wrote in message
...
(shinypenny) wrote:

Not in my case. My rent kept going up year after year, sucking up any
raise increase I got. I bought a house in which the mortgage payment +
taxes + insurance equalled what I was paying in rent, but it will
never go up from here on out. Any future raises will be gravy.

Uhhh, don't expect that. Insurance in Florida skyrocketed after hurricane
Andrew, and contines to go up. Property taxes here were rising so fast
that
many seniors had to sell their homes. That one got capped locally with a
constitutional ammendment capping property tax increases to 2% per year.
Most
places don't have that safeguard.

True, but if you rent you're going to cover those costs for the landlord
anyway. And where insurance is concerned, I discovered that the premiums on
my rental property were rising at a way faster rate than on my homeowners'
insurance. Don't know if that's universally applicable, but it was my
experience.

"victor" wrote in message
news
Ok, ok, ok. My friends and family keep nagging at me to stop renting
and buy a house. I'm so sick of them droning on about points-this and
closing costs-that. But the more I think about, the less sense it seems
to make for me. Here's why:

1. "You'll save a fortune on taxes." True. But the property taxes
will pretty much cancel out any savings you got on the income taxes.

Don't you realize that when you pay rent you're paying the property tax for
the owner anyway? In fact, you're covering all the landlord's costs plus
paying them additional for the use of the property. And as you realize,
you're getting no tax break for it whatsoever.

2. "You're throwing rent money down the toilet." True. In all
likelihood, your mortgage payment will be twice your rent. By the time
you pay it off, you'll be drinking Ensure, wearing Depends, and too old
to maintain the house. Then you'll be wanting to move back to ... AN
APARTMENT! By that time, an assisted living apartment. And let's be
realistic. You're NOT going to be like those power couples in Money
magazine who claim they're going to pay off the mortgage in 5 years and
retire in 10. Yeah, right.

DH and I paid off our mortgage when we were 40 and 45, respectively. We were
middle-income people. We later chose to move to a larger, more costly house
and take on a new mortgage, but if we hadn't, we'd have been looking at
about 30 years or more of no-rent, no-mortgage living, with money stashed
away to pay for that assisted living facility when the time came.

3. "It's one of the few things you buy that appreciate in value."
Assuming that you find someone who is willing to pay your inflated
selling price. Assuming that the neighborhood doesn't go down the
tubes. Assuming that the new house you buy will end costing as much as
you think it's going to (not!). Too many assumptions.

People have indeed been burned on sale price alone, and I can tell you that
the house DH and I owned for more than 20 years certainly didn't appreciate
in value enough to keep up with the inflation rate at the time. However, we
had the use of the property to live in over that time, and we were building
up equity. The neighborhood didn't go anywhere--it was pretty much the same
when we left. It was an established area of 40-year-old houses. Had we
decided to stay another 30 years, I suspect nothing much would have changed
either. Too soon to say for sure, though.

4. Maintenance. I'm lucky if I have time to clean my apartment, let
alone a house. I've worked customer service for plumbing, HVAC, and
home maintenance companies before, and I hear how much people pay for
this stuff. In an apartment, it's all FREE.

Free??? At this point I'm starting to agree that you shouldn't buy a house,
because you have to be either extremely stupid or trolling. THE LANDLORD
DOESN'T SUPPLY YOU WITH FREE MAINTENANCE. You pay for it in your rent. As in
#1 above, you also pay a surcharge for the maintenance services the landlord
arranges for. It's part of his/her PROFIT.

In the end, I suppose it's a matter of personal preference. But I do
wish my home-owning friends would cut out the holier-than-thou attitude.

Actually it's obvious you've made up your mind. I only spent time responding
to your post for the benefit of other people who might be reading. Your
friends are probably not being holier-than-thou, they're more likely just
being smarter-than-thou. That said, though, I absolutely agree it's a matter
of personal preference. Enjoy your apartment lifestyle, but don't try to
convince anyone it's necessarily fiscally responsible.

wrote in message
...

...and given a chance I'll vote for the ammendment that proposes to
increase the homestead exemption to more fairly represent actual values.

Sadly, it probably won't make the ballot - too much lost revenue at stake.
But I'm keeping my fingers crossed just the same. Bumping the exemption to
$50k sure would be sweet.

Thanks to the 3% cap, my home's taxable value - currently assessed at an
unrealistically low $58k - would result in future property tax bills
amounting to next to nothing. Sounds too good to be true, so it probably
won't happen.

Low rates or not, it must be tough times for (single) young
adults/first-time buyers seeking home ownership.

Anything less than $200k seems like a deal these days. And when you factor
in (likely very high) property taxes, insurance, utilities, etc. - well, I
don't know how (or if at all) they do it. I sure as hell couldn't...

Mike

wrote:
"Travis Jordan" wrote:

I'm not sure that the proposed amendment to raise the homestead
exemption by 25K per home is a good idea. I'd encourage you to look
into this a little bit before you vote for it - in order to maintain
revenue taxes will simply shift to those with "higher priced" homes
- by my estimate around 300K seems to be the valuation above which
you could expect to pay higher taxes. Since Amendment 10 applies to
market valuation, not to tax rates there isn't any law to prevent the
municipalities from simply raising rates to make up for the lost
income. Which of course they will do. I don't see that information
anywhere in the hoo-hah publicity touting the increased homestead
exemption. In fact, the web site for the proponents says that
taxing authorities already have a 'windfall' from increasing
property values so they don't need any more money. Of course, how
silly of me.

I understand that concern, but I'm not sure that it applies. The
raising of property tax rates would most directly affect _new_ home
buyers of houses valued at $300K or more, and thus cool the real
estate market to a point that would be unacceptable, especially now
that it appears interest rates may rise. Just like in "Sim City"
higher tax rates equate to slower growth (a gross oversimplification,
but generally true).

However, the current cap on increases is _not_ affected, and since
the yearly tax increases for current property owners already come at
or close to the legal limit, from what I've experienced, the new
amendment would still have a positive effect for long-term home
owners unless the tax rates went totally wild. In essence, I would
pay less property tax, and new purchasers of more expensive
properties would pay more property tax. While I don't have a serious
problem with the ethics of that, I don't think that it will play out
that way - either in general statewide, or on a local level - where
our town has been fiscally responsible.

The proposed amendment will more likely result in county add-ons to
the sales tax, and increased property taxes upon commercial property,
including apartments. Broward is currently about the only county
without an added county sales tax, so that first part is almost a
given where I live. Since businesses have increasingly been allowed
tax concessions to locate in a town, I don't take issue with their
taxes going up.

The un-needed "windfall" propaganda is just propaganda that can be
dismissed out of hand, but I do feel that a realistic homestead
exemption is in the best interest of fixed income seniors and those
who struggle to keep their property, and that the adjustment is only
fair. Inflation, which is what this is really about, is a hidden tax
that politicians don't have to answer for.

Whereas the save-our-homes amendment now has an increasing effect of
slowing the musical chairs style of real estate sales here, and
improving the feel of community, I see the new amendment less as a
quality of life issue and more as a redistribution of the tax burden
that more accurately reflects current day valuations. I certainly
respect that not everyone feels this way.

http://www.myflorida.com/dor/property/limitations.html

Unfortunately, Amendment 10 only caps the ASSESSED VALUATION of
homesteaded property. The millage RATE isn't capped. If the property
tax decreases for homeowners across the state by an estimated $611 each
the cities and counties will raise the millage rate to make up for the
lost revenue. You are correct that some locales may find it more
politically popular to raise sales taxes.