I'm 52. I rented until I was 44. I moved several times between 25 - 31 yrs old. Once I was in my 30's was able to save money. Then by 44, I bought a house with a 68% down payment and paid it off in 3 years. My short advice, rent as long as you want, just make sure you are saving money during the process.
My father ran a very successful medical practice and earned a decent return in the stock market but the primary reason he was able to retire comfortably was due to the value of his primary home and investment properties. My wife and I have very high incomes and a considerable amount of savings and investments but the primary reason we are able to retire early is due to the value of our primary home and investment properties. It's important to look at the stats when making a specific rent versus buy decision but reality has convinced me that owning is almost always the way to go.
I bought my first home this year. Terrible time to buy, but I didn't care to rent and needed to move out. Have a 6 month emergency saved, my housing expenses are less than 25% of my gross. If the value of my house tanks, I'll just rent it, which was my plan anyway. It's not an ideal situation, but oh well. I think people also need to plan for it not getting any better than this.
I needed this, I feel that a lot of people feel guilty or feel behind because they can’t get a house. I love the flexibility and the liquidity of ETFs and Index funds
Everyone's situation is different. I did not save enough, early enough and I don't have a lot of time to catch up. It made sense to me to downsize and have no mortgage or rent by the time I retire so I can live off SS, pension, etc.
I own a home that my disabled daughter lives in alone. I rent an apartment because I work a lot of crazy hours in the medical field and need the peace and quietness and alone time when I'm not at work. I also know that as my mother (86) ages, I may have to move in with her. (I could be there at night and my sister can be available during the day). At the present, my apartment is strictly utilitarian. I'm only "home" long enough to cook, clean, eat, shower and sleep. As a widow, I don't need an entire house to look after with all of it's care and maintenance. Even mowing the lawn would be a huge hassle or expense fo me. I'm more than happy to let my landlord take care lawn care, repairs, utilities, painting, trash removal, etc.
unless you really want to move often or don’t like being tied down, I feel like owning a condo or garden-styled apartment is a good inbetween state of having something you can sell later for a profit while not worrying about general homeownership issues like roofing
@@justthebrttrk It depends. I can definitely tell you after owning a garden-styled condo in a state with a top-5 property tax rate (2%) that after 1.75 years I was able to walk away with $30k more after fees/taxes/etc. in my account after selling it than when I started. Mortgage, interest, insurance, taxes, utilities, HOA fee all came to about $900/month for a 1 bed 1 bath. Rent in the same area for the same size was $1,300-1,600/month. Since it was a garden-styled condo, you only worried about what happened between the walls. So, when the roof leaked I didn't pay anything. When the dryer keeled over, I replaced it. The cost of the dryer was made up in one month of ownership. Probably doesn't make sense somewhere like Texas where rent is on par or better a lot of times cost-wise, but in my personal experience in the Midwest, I was able to walk away with a good chunk of change. We upgraded to a townhouse that now has appreciated $125k since we bought it. Net if we sold it today after agent fees, other fees, moving costs, mortgage payoff, etc. would be over $115k. 3 bed / 3 bath now costs us $2,200 per month for everything housing-related, including putting money away for replacements that'll need to be done in the future and the high property taxes.
It’s interesting that Brian’s perspective is that American home owners lack of savings outside the home is an indictment of their priorities as opposed to a commentary on them buying homes they can’t actually afford if they also want to contribute like they NEED to to their retirement savings.
completely backwards. mortgages are the amount of money owed at the time of purchase. rent is the amount of money owed on a landlords yearly appraisal.
@@commonsense-og1gz that’s just the mortgage. Buying a home adds property taxes, home insurance, closing costs, finance costs, maintenance, appliance purchases, and other costs. If I rent, my only variable expense is renters insurance which is usually no more than $7 a month.
We bought early pandemic. And have a 3.25 interest rate. I love it. No debt, and emergency fund is done.i love my interest rate on my home. But I’ve found that I love investing more, and I’m severely behind for my age. (30) Which to prioritize 🤔
I'm going to assume by prioritizing you have been making more than the required payments for your mortgage. So I would strongly suggest that you make 1 additional mortgage payment a year which would bring down the time and interest you pay on the loan by a lot (4-6 years/ hundreds of thousands of dollars). With any other left over margin you have I would strongly suggest that you get up to 25% savings rate for retirement and build up a strong emergency fund if you have not done so.
@@jonahlim5977At 3.25%, they'd be better off investing that additional mortgage payment and paying off the loan entirely with the returns after 15-20 years. It's faster. Putting an extra payment with current interest rates makes more sense, though.
@@ErosisThat's been proven to cause people to overspend and go into debt as they try to keep up with their neighbors' richer lifestyles. Doesn't matter if they have an iron will or not, it's just how people function Also richer neighbors can be much, much worse than regular neighbors because they have the resources and lawyers to be as petty and obnoxious as they want. Needless to say, we disagree on that assessment Charlie would be best-off just knocking on the potential neighbors' doors and introducing themself. A quick conversation can go far to helping you decide if you want to live next to that person
@@rayzerotsuburbanites are way nicer and safer to be around than most poor people. I remember playing in the street unsupervised when I was a kid and I could do that because my parents lived on a safe street in a nice neighborhood.
This happened to an older couple I know. They live in an expensive area of million dollar homes and the house next door was always nicer than theirs. For 21 years there were great neighbors all around & then about 15 years ago the wife left next door and slowly things began to deteriorate. The porch is full of odds, ends and various chairs. It’s completely neglected & wild skunks visit to eat cat food by the front door which is often left open all hours of the night, the garage door is warped and partly open, it has strange rain stains, 4 vehicles are parked in front and the lawn has turned to 3 foot weeds. The couple I know needs to downsize but who is going to buy a beautifully remodeled 1M home next to that wreck?
The thing I tell friends when they ask this question is that your primary residence may or may not be a good investment, but buying a house with a fixed-rate mortgage locks in a big chunk of your expenses. Yes, taxes will go up. Yes, insurance will go up. But that principal+interest payment will stay the same. And during that time you'll hopefully be advancing in your career and making more money. All else being equal, that means increasingly more room in your budget for saving and investing. In short, owning a home can allow _you_ to be a better investor. Homeownership is not an automatic ticket to wealth, but it can be a great opportunity for folks who are intentional with their money to save and invest even more money.
4:26 Exactly! A house you live in is generally a horrible asset. From 1900-2000 the annual return was 2.5% to 3% after inflation and sunken costs. The past dozen or so years was simply a result of high inflation and unsustainable near 0% interest rates.
The number of homes on the market with outrageous price tags that are sitting dormant for months is indicative of an oversaturated and inflated housing market. It is obvious that the bubble bursts of our generation will probably be among the worst in contemporary history. I'm 48 and looking for the best ways to turn $250k into $1 million or more and buy a nice house for retirement.
A lot of insurance companies are leaving Florida, so homeowners are at a big time loss, and the insurance companies that are left over are beyond expensive, plus the weather is only getting worse with storms and hurricanes the more issues the more the cost over time, inflation is bad enough the cost of living is terrible, my goal,is to move out of Florida paying nearly $1700.00 a month with rent water and electric price included ( the place is a dump ) I’m finding places in Georgia $800-1200.00 range and these have pools gyms much much nicer conditions, I could still never own a home.
Given the temporal state of the job market, prices of homes and interest rates… really hard to say either way whether a person can feel good about committing to one place for 10 years buying right now. Feels like it comes down to size of down payment to bring down the time component of that equation. No one knows the future. Do what works for you and ignore us in the comments… also, make sure you run the numbers.
Thank you for being honest about the housing situation. We are due for a down turn and people are needing to evaluate keeping their homes for at least the next decade
We're not going to hit a downturn for over a decade. At least. Bare minimum The housing market is in a state where many, many people are not buying houses because they're deliberately holding out for a lower price or they're priced out entirely. This means that the moment house prices dip, even a little, the pent up demand will keep prices from dropping any further as sidelined consumers jump back into the market and stabilize the price The supply falls further behind demand every year due to overly respective zoning laws. Nothing will change until zoning laws allow for more housing and more multi-family housing
@@rayzerotPlausible but no one can predict the future. Prices are already dropping in many areas and we don't see the frenzy your are speaking of. People made the same argument before the gfc. There was a fomo back then too created by realtors and lenders, the market "felt strong" before it crashed. Not saying the situation is the same but that it is very hard the predict the markets.
The fixed mortgage, rent , stays constant. Renting costs go up with inflation. Stocks, cash, bonds and real-estate are assets one should own to create wealth. No taxes paid as real-estate increases in value. If not wanting to own a house, see town homes, less maintenance. ( not sure about condos) .
(Brian’s Troll here) 2:11 Bo… absolutely not true for much of the US. If your gonna podcast to the nation, get your head out of Tennessee and look at broader statistics. it’s interesting that they have rule of a mortgage being around 25% of gross , while (in many areeas) rent far exceeds the 25%. There are tax advantages to a mortgage and as long as your mortgage (and maintenance expenses) are equal to rent rates in your region, it’s a good investment.
Trump/the Federal Government (Pick your favorite scapegoat) effectively removed the tax advantage of mortgage interest payments when they raised the federal income standard deduction. That's no longer a point in favor of owning a home
100% of people that rented for life are worse off than people that bought a home and stayed longer term. If you are moving every 1-2 years, you are not responsible enough for home ownership.
![I.N "HALLUCINATION" | [Stray Kids : SKZ-PLAYER]](http://i.ytimg.com/vi/n5B5q1Hwt_U/mqdefault.jpg)
I'm 52. I rented until I was 44. I moved several times between 25 - 31 yrs old. Once I was in my 30's was able to save money. Then by 44, I bought a house with a 68% down payment and paid it off in 3 years. My short advice, rent as long as you want, just make sure you are saving money during the process.
Before you buy, you need to have a fully funded emergency fund and ensure that you’re going to be in the area for at least five to seven years.
My father ran a very successful medical practice and earned a decent return in the stock market but the primary reason he was able to retire comfortably was due to the value of his primary home and investment properties.
My wife and I have very high incomes and a considerable amount of savings and investments but the primary reason we are able to retire early is due to the value of our primary home and investment properties.
It's important to look at the stats when making a specific rent versus buy decision but reality has convinced me that owning is almost always the way to go.
I bought my first home this year. Terrible time to buy, but I didn't care to rent and needed to move out.
Have a 6 month emergency saved, my housing expenses are less than 25% of my gross.
If the value of my house tanks, I'll just rent it, which was my plan anyway. It's not an ideal situation, but oh well.
I think people also need to plan for it not getting any better than this.
The time i got my house it was cheaper than renting. That seemed like a better deal to buy a home.
I needed this, I feel that a lot of people feel guilty or feel behind because they can’t get a house. I love the flexibility and the liquidity of ETFs and Index funds
Everyone's situation is different. I did not save enough, early enough and I don't have a lot of time to catch up. It made sense to me to downsize and have no mortgage or rent by the time I retire so I can live off SS, pension, etc.
The marketing by Realtors is what makes people fall victim. A realtor is always going to say it is an excellent time to buy.
I own a home that my disabled daughter lives in alone. I rent an apartment because I work a lot of crazy hours in the medical field and need the peace and quietness and alone time when I'm not at work. I also know that as my mother (86) ages, I may have to move in with her. (I could be there at night and my sister can be available during the day). At the present, my apartment is strictly utilitarian. I'm only "home" long enough to cook, clean, eat, shower and sleep. As a widow, I don't need an entire house to look after with all of it's care and maintenance. Even mowing the lawn would be a huge hassle or expense fo me. I'm more than happy to let my landlord take care lawn care, repairs, utilities, painting, trash removal, etc.
unless you really want to move often or don’t like being tied down, I feel like owning a condo or garden-styled apartment is a good inbetween state of having something you can sell later for a profit while not worrying about general homeownership issues like roofing
@@justthebrttrk It depends.
I can definitely tell you after owning a garden-styled condo in a state with a top-5 property tax rate (2%) that after 1.75 years I was able to walk away with $30k more after fees/taxes/etc. in my account after selling it than when I started. Mortgage, interest, insurance, taxes, utilities, HOA fee all came to about $900/month for a 1 bed 1 bath. Rent in the same area for the same size was $1,300-1,600/month. Since it was a garden-styled condo, you only worried about what happened between the walls. So, when the roof leaked I didn't pay anything. When the dryer keeled over, I replaced it. The cost of the dryer was made up in one month of ownership.
Probably doesn't make sense somewhere like Texas where rent is on par or better a lot of times cost-wise, but in my personal experience in the Midwest, I was able to walk away with a good chunk of change. We upgraded to a townhouse that now has appreciated $125k since we bought it. Net if we sold it today after agent fees, other fees, moving costs, mortgage payoff, etc. would be over $115k. 3 bed / 3 bath now costs us $2,200 per month for everything housing-related, including putting money away for replacements that'll need to be done in the future and the high property taxes.
I just don’t want to retire and have high rent on a limited income
It’s interesting that Brian’s perspective is that American home owners lack of savings outside the home is an indictment of their priorities as opposed to a commentary on them buying homes they can’t actually afford if they also want to contribute like they NEED to to their retirement savings.
Rent is the maximum amount you pay each month; a mortgage is the minimum you pay.
Great way to put it!!
OK Ramit Sethi.
completely backwards. mortgages are the amount of money owed at the time of purchase. rent is the amount of money owed on a landlords yearly appraisal.
@@commonsense-og1gz that’s just the mortgage. Buying a home adds property taxes, home insurance, closing costs, finance costs, maintenance, appliance purchases, and other costs.
If I rent, my only variable expense is renters insurance which is usually no more than $7 a month.
@@commonsense-og1gzyou got this one a little confused bud it’s okay keep listening to the picket fence propaganda lmao
It's so weird to me to look at my home as an investment. I need a place to live and I love the house that I live in.
We bought early pandemic. And have a 3.25 interest rate. I love it. No debt, and emergency fund is done.i love my interest rate on my home. But I’ve found that I love investing more, and I’m severely behind for my age. (30) Which to prioritize 🤔
I'm going to assume by prioritizing you have been making more than the required payments for your mortgage. So I would strongly suggest that you make 1 additional mortgage payment a year which would bring down the time and interest you pay on the loan by a lot (4-6 years/ hundreds of thousands of dollars). With any other left over margin you have I would strongly suggest that you get up to 25% savings rate for retirement and build up a strong emergency fund if you have not done so.
@@jonahlim5977At 3.25%, they'd be better off investing that additional mortgage payment and paying off the loan entirely with the returns after 15-20 years. It's faster. Putting an extra payment with current interest rates makes more sense, though.
I'm terrified of buying a home because of the chances of getting stuck with bad and nuisance neighbors.
Buy the cheapest home in a nice neighborhood. That's how you lower the odds of a problem.
@@ErosisThat's been proven to cause people to overspend and go into debt as they try to keep up with their neighbors' richer lifestyles. Doesn't matter if they have an iron will or not, it's just how people function
Also richer neighbors can be much, much worse than regular neighbors because they have the resources and lawyers to be as petty and obnoxious as they want. Needless to say, we disagree on that assessment
Charlie would be best-off just knocking on the potential neighbors' doors and introducing themself. A quick conversation can go far to helping you decide if you want to live next to that person
@@rayzerotsuburbanites are way nicer and safer to be around than most poor people. I remember playing in the street unsupervised when I was a kid and I could do that because my parents lived on a safe street in a nice neighborhood.
This happened to an older couple I know. They live in an expensive area of million dollar homes and the house next door was always nicer than theirs. For 21 years there were great neighbors all around & then about 15 years ago the wife left next door and slowly things began to deteriorate. The porch is full of odds, ends and various chairs. It’s completely neglected & wild skunks visit to eat cat food by the front door which is often left open all hours of the night, the garage door is warped and partly open, it has strange rain stains, 4 vehicles are parked in front and the lawn has turned to 3 foot weeds. The couple I know needs to downsize but who is going to buy a beautifully remodeled 1M home next to that wreck?
The thing I tell friends when they ask this question is that your primary residence may or may not be a good investment, but buying a house with a fixed-rate mortgage locks in a big chunk of your expenses. Yes, taxes will go up. Yes, insurance will go up. But that principal+interest payment will stay the same. And during that time you'll hopefully be advancing in your career and making more money. All else being equal, that means increasingly more room in your budget for saving and investing. In short, owning a home can allow _you_ to be a better investor. Homeownership is not an automatic ticket to wealth, but it can be a great opportunity for folks who are intentional with their money to save and invest even more money.
4:26
Exactly! A house you live in is generally a horrible asset. From 1900-2000 the annual return was 2.5% to 3% after inflation and sunken costs. The past dozen or so years was simply a result of high inflation and unsustainable near 0% interest rates.
I prefer freedom and owning a home ties you down.
4:28
Exactly!
The number of homes on the market with outrageous price tags that are sitting dormant for months is indicative of an oversaturated and inflated housing market. It is obvious that the bubble bursts of our generation will probably be among the worst in contemporary history. I'm 48 and looking for the best ways to turn $250k into $1 million or more and buy a nice house for retirement.
Stupid bots
Landlords borrow money, over the years rents tend to increase. Mortgage stays the same. It’s similar to renting a car. Owning wins.
A lot of insurance companies are leaving Florida, so homeowners are at a big time loss, and the insurance companies that are left over are beyond expensive, plus the weather is only getting worse with storms and hurricanes the more issues the more the cost over time, inflation is bad enough the cost of living is terrible, my goal,is to move out of Florida paying nearly $1700.00 a month with rent water and electric price included ( the place is a dump ) I’m finding places in Georgia $800-1200.00 range and these have pools gyms much much nicer conditions, I could still never own a home.
Given the temporal state of the job market, prices of homes and interest rates… really hard to say either way whether a person can feel good about committing to one place for 10 years buying right now.
Feels like it comes down to size of down payment to bring down the time component of that equation.
No one knows the future. Do what works for you and ignore us in the comments… also, make sure you run the numbers.
Do you think 5 to 7 years is still a correct assumption when house prices increase with 5 to 7 % p.y. ?
5-7%/yr is not normal
hella sick😌
Thank you for being honest about the housing situation. We are due for a down turn and people are needing to evaluate keeping their homes for at least the next decade
We're not going to hit a downturn for over a decade. At least. Bare minimum
The housing market is in a state where many, many people are not buying houses because they're deliberately holding out for a lower price or they're priced out entirely. This means that the moment house prices dip, even a little, the pent up demand will keep prices from dropping any further as sidelined consumers jump back into the market and stabilize the price
The supply falls further behind demand every year due to overly respective zoning laws. Nothing will change until zoning laws allow for more housing and more multi-family housing
@@rayzerotPlausible but no one can predict the future. Prices are already dropping in many areas and we don't see the frenzy your are speaking of. People made the same argument before the gfc. There was a fomo back then too created by realtors and lenders, the market "felt strong" before it crashed. Not saying the situation is the same but that it is very hard the predict the markets.
The fixed mortgage, rent , stays constant. Renting costs go up with inflation. Stocks, cash, bonds and real-estate are assets one should own to create wealth. No taxes paid as real-estate increases in value. If not wanting to own a house, see town homes, less maintenance. ( not sure about condos) .
Economy is completely broken
Do wealthy people rent or own?? I would guess more wealthy people own over rent!!
I'd presume the ultra-wealthy have multiple homes, and would rather rent to avoid the pains of home ownership.
commonly hear wealthy people say "rent where you live and own what you can rent." - they often view owning property as a business
@@abluelark wealthy people are to cheap to lose money renting
Most regular millionaires have home equity as the second biggest component of their net worth.
(Brian’s Troll here) 2:11 Bo… absolutely not true for much of the US. If your gonna podcast to the nation, get your head out of Tennessee and look at broader statistics.
it’s interesting that they have rule of a mortgage being around 25% of gross , while (in many areeas) rent far exceeds the 25%. There are tax advantages to a mortgage and as long as your mortgage (and maintenance expenses) are equal to rent rates in your region, it’s a good investment.
Trump/the Federal Government (Pick your favorite scapegoat) effectively removed the tax advantage of mortgage interest payments when they raised the federal income standard deduction. That's no longer a point in favor of owning a home
the average home value increase nation wide is right around 3%/yr, in line with inflation
100% of people that rented for life are worse off than people that bought a home and stayed longer term. If you are moving every 1-2 years, you are not responsible enough for home ownership.
wrong. I and many of my friends are millionaires in our late 20s without ever owning a personal residence
@@firstlast9217 I never made the claim you couldn't be a millionaire without owning a home.
100% of people? So you surveyed all the people who rented for life versus those who bought a home and their financial situations?
@@FaintAura Don't need to, it's just math.
@@bens3134 so you've got nothing, got it