patrick.net

StoutFiles says

I think he meant that a customizable wall color should not be a huge selling point for getting a 30 year mortgage.

Correct.

ch_tah says

Ok, so your problem is that you, like Klarek, already know everything, so this article was useless to you.

As opposed to a fresh, new homeowner whiffing the euphoric moment of peak debtitude?

I would imagine the article isn't talking about CA where you can see 3 identical houses next to each other, one for 599, one for 399 and one for 199 and wonder what will happen once interest rates go back up.

edvard2 says

Sure- I’ll buy a house someday. But its not going to be due to me suddenly being able to swing a sledge hammer and demolish dining room walls.

Exactly. It's like suggesting buying a car (for the same monthly payment) is better than leasing the car, because if you buy you can throw on a huge spoiler and lower the chassis if you like.

2 things there. 1) Those things are frivolous and cost money (just "getting" to do them is no benefit necessarily) and 2) very few people care about doing that crap anyway.

Seriously, how many of you renting really sit around thinking, "man, if only I owned this place...I'd put in an island right here!" or, "Man I wish I could knock this wall down and combine these rooms!" People talk all the time about how owners are better citizens than renters, because renters don't care about the property (having no vested interest in it), yet all of the sudden not being able to throw $25k into a new kitchen in their rental unit is eating away at them? Please. Renters don't sit around dreaming of how they'd like to remodel the unti they are renting. They sit around thinking of what they want to do with their place once they buy one. No one renting is seriously lamenting not being able to tear walls down in their home. (Especially because any assertion to the contrary assumes that all renters are involuntary renters. If I go to lease a car, it is with a firm understanding that I won't get to lower it and put 22 inch rims on. Similarly, when one chooses to rent, they know a full kitchen remodel is not in the cards going in)

ch_tah says

Ok, so your problem is that you, like Klarek, already know everything, so this article was useless to you. Perhaps there are people not as smart as you, and this article provided some useful information.

It is a worthless article. It's about as enlightening as those, "5 skincare tips for summer!" articles. How many times do we have to be told to wear sunblock, limit sun exposure between 1pm-3pm, wear sunglasses -especially when out on the water, know the difference between UVA and UVB, and always bring a hat during periods of long exposure? Sure it's 'pertinent' information, but it still makes for a worthless article.

Schizlor says

2) very few people care about doing that crap anyway.

If very few people care about that crap anyway, then why would someone write about it? Either the author and everyone else who mentions it is seriously out of touch with the world, or it is something people (shallow or not) can relate to.
Schizlor says

They sit around thinking of what they want to do with their place once they buy one.

So you ARE saying renters want to own a place to be able to remodel it.
Schizlor says

It is a worthless article. It’s about as enlightening as those, “5 skincare tips for summer!” articles.

Based on the fact that you agree you'd like to own your own house to be able to remodel it, you don't have a problem with the content of the article, you just feel there is nothing new. I guess for those who have just started looking into housing, some of this information may be enlightening.

ch_tah says

If very few people care about that crap anyway, then why would someone write about it?

Because, like the very few people who care about it, the author is a shallow moron.

ChrisLA says

I would imagine the article isn’t talking about CA where you can see 3 identical houses next to each other, one for 599, one for 399 and one for 199 and wonder what will happen once interest rates go back up.

Are you full of crap again? Or can you provide some addresses?

Schizlor says

Seriously, how many of you renting really sit around thinking, “man, if only I owned this place…I’d put in an island right here!” or, “Man I wish I could knock this wall down and combine these rooms!” People talk all the time about how owners are better citizens than renters, because renters don’t care about the property (having no vested interest in it), yet all of the sudden not being able to throw $25k into a new kitchen in their rental unit is eating away at them? Please. Renters don’t sit around dreaming of how they’d like to remodel the unti they are renting. They sit around thinking of what they want to do with their place once they buy one. No one renting is seriously lamenting not being able to tear walls down in their home

For me specifically I don't care about decorating. We collect a lot of antiques thus the interior of our rented house serves as more of a place to display them. I care more about the yard. In our case we have several vegetable and flower gardens along with a patio and grilling area made out of bricks we got for free. We will buy a place someday. But honestly I suck at home renovation. I can fix cars all day along. I can also weld and fabricate out of metal. But when it comes to lumber I can't drive a nail straight.

klarek says

ch_tah says

If very few people care about that crap anyway, then why would someone write about it?

Because, like the very few people who care about it, the author is a shallow moron.

Ok, well, there are a lot of shallow people in this country. To them, it is a benefit.

ch_tah says

If very few people care about that crap anyway, then why would someone write about it?

You're not seriously contending that everything some editor puts in print was worth writing about, are you?

ch_tah says

So you ARE saying renters want to own a place to be able to remodel it.

I'm saying people who are renting accept the fact they aren't going to remodel the place before they even sign the lease. Those who want to go gangbusters on home improvement projects probably skrimp and save (like everyone did pre 2000) to get their own place, and then have their way with it. The % of people who HAVE to rent, but are DYING to remodel their living space, is miniscule IMO. I could be wrong, but I doubt most renters are DIY enthusiasts living lives of quiet desperation.

ch_tah says

Based on the fact that you agree you’d like to own your own house to be able to remodel it, you don’t have a problem with the content of the article, you just feel there is nothing new

Correct. However, I don't want to own a home just to remodel it. I want to own a home when the time is right for me and my fiance, and if/when we find a home we like that may need remodeling, we'll cross that bridge when we come to it. But no, I do not aspire to be a homeowner simply so I can modify the home. (which is why, "You can modify it if you want!" is not a "benefit" to homeownership, it's just an option. If getting to modify a home is a "benefit", then technically being required to pay for major repairs of appliances at your tenant's request (rather than when you damn well feel like it) is one of those wonderful "benefits" of being a landlord.)

edvard2 says

I care more about the yard. In our case we have several vegetable and flower gardens along with a patio and grilling area made out of bricks we got for free

This is an oft overlooked aspect of renting too. That many times, you modifying the rental is a BENEFIT to the landlord. Do they "mind" that you want to spend hours upon hours in the garden, making the outside of the home very attractive, neat, and tidy? Of course not. You "modifying" their yard probably just gave them a few thousand dollars worth of free landscaping. Similarly, when you touch up the paint, or fix a loose door handle, or any other nominal home improvement projects a renter might engage in, you are actually participating in the upkeep of the landlord's property. It is a net-gain for them.

Not every landlord is going to say, "Keep your fucking hands off my property, renter!!" any time you want to "modify" the home. Unless you're gutting the place, ripping up carpet, or removing major fixtures like toilets/sinks, most of what renters do to a home (in terms of projects, not wanton damage or anything) could be considered free maintenance/upgrade to the property, and in my experience most landlords are more than happy to let you touch up their paint, fix a door handle, or landscape their yard.

Schizlor says

Correct. However, I don’t want to own a home just to remodel it. I want to own a home when the time is right for me and my fiance, and if/when we find a home we like that may need remodeling, we’ll cross that bridge when we come to it. But no, I do not aspire to be a homeowner simply so I can modify the home. (which is why, “You can modify it if you want!” is not a “benefit” to homeownership, it’s just an option. If getting to modify a home is a “benefit”, then technically being required to pay for major repairs of appliances at your tenant’s request (rather than when you damn well feel like it) is one of those wonderful “benefits” of being a landlord.)

Yes, the option of being able to remodel a home is a benefit. Yes, it comes with the drawback of having to pay for such modification and other maintenance.

I don't think anyone ever said, they want to buy a home because they want to remodel something. The ability to remodel is what they like, and it is just one of the benefits of owning, not the sole one and not even a very big one.

Just like owning your own business has the benefit of potentially making a lot of money, it does come with additional liability and demand. The fact that their are some downsides to owning a business doesn't mean it doesn't have benefits.

ch_tah says

Yes, the option of being able to remodel a home is a benefit. Yes, it comes with the drawback of having to pay for such modification and other maintenance.

I guess we're getting into semantics here, but I still contend there is no "benefit". It's no more a "benefit" to be able to choose to buy a new garage door opener, than it is a "benefit" to have to fix a broken hot water heater. On one hand it is a requirement (fix heater or go without hot water) a financial obligation (net-negative, a drawback if you will)

I'm saying the two cancel each other out:

Rent: CAN'T put in whatever I want. BUT I don't HAVE to fix a damn thing.

Own: CAN put in whatever I want, but MUST fix things that break.

To me they are zero sum. And believe me, when the hot water heater breaks, or the washer, or the HVAC until, I am DAMN happy I am not the owner of my unit. Actually, I'd say in general I'd rather have no option to modify (without permission mind you....it's not 100% cannot, you just have to get permission) with 0% liability to fix major appliances, rather than have the option of painting the home candystripe if I want to, but having NO CHOICE but to fix things as they break.

Trying to argue owning has lots of benefits is like trying to argue having children provides lots of benefits. Sure, in many ways, it does. But the liability that comes with having children is enormous. Trying to argue for homeownership on frivolous things like, "You can paint the walls whatever color you like, as often as you like!" is about as relevant as arguing for having a child by saying, "Sure they are expensive and require round the clock supervision, but you can dress them in whatever clothes you want every day!"

Sorry, I need something more substantial in the "benefit" category than getting to play dress up with my home whenever it pleases me.

The "cheaper to buy than rent" crowd says:

1) You should pay up for the freedom to dump a bunch of money into your home, making it your dream home.
2) In rent-vs-buy calculations, you should assume you can maintain your place, without cutting corners, with infrequent, bargain-basement costs. Aka, you won't exercise that freedom that you just paid up for.

Every decade, the average owner has a few of these major expenses - kitchen/bathroom remodel, roof, addition, resealing basement, replace siding, major landscaping or ground tear up, HVAC replacement, plumbing project, etc...

-Unexpected maintenance costs are just that, unexpected
-Selling at the same relative price point at which you bought requires significant investment
-Opportunity costs and price appreciation assumptions should be consistent with one another (interest rates rise and fall with inflation, loosely, regardless of causality)

If you're honest about these three things, buying almost NEVER makes financial sense over renting. Some SUPER distressed sales have begun to make sense.

Coogan99 says

1) You should pay up for the freedom to dump a bunch of money into your home, making it your dream home.
2) In rent-vs-buy calculations, you should assume you can maintain your place, without cutting corners, with infrequent, bargain-basement costs. Aka, you won’t exercise that freedom that you just paid up for.

Precisely my point. Well-stated.

Schlizor,
It's not semantics. You are arguing certain items are not benefits because there responsibilities or drawbacks. They are two separate items. Just because you have to pay for the paint to paint the walls doesn't mean the ability to paint the walls is not a benefit. No one disagrees that owning a home has some negative aspects. Just because children are expensive, bring worry and take up all of your time, it doesn't mean they aren't extremely beneficial in some ways.

The way you describe homeownership, I wonder why you would ever want to own a home. What good is there to owning if it just means you have additional liability? More specifically, if your rent payments and your house payments would be the same, yet you have these additional liabilities, would you purchase? If so, why?

Schizlor says

I’m saying the two cancel each other out

Agreed. The rims on the car is a good analogy too.

ch_tah says

I don’t think anyone ever said, they want to buy a home because they want to remodel something.

I hear it all the time from people who are buying their first house. It's usually the next thing said after "It's mine".

There are trade-offs in renting versus owning, whether we're talking about cars, houses, or tuxedos. I've grown nauseated reading asinine remarks from our housing enthusiasts who use every distinction between owning/renting as a plus for owning, to the point that they say that it's a net positive to pay thousands of dollars in repairs. "Well, at least I get to choose to do it , and not some evil landlord." No, you have no choice, and if you don't have the available funds to perform the repairs because you decided to sink all your money into the house for your precious "upgrades", you're fucked.

Assuming that the monthly cost of owning (30 year fixed rate PITI) and renting (increase with area incomes) is the same for the exact same property, which in most cities today it's not, you have a series of other trade-offs:

-Owners get "stability", where renters have "flexibility. Neither is better from an objective standpoint, but new homeowners love to puff up the stability side as a fulfillment of their psychological post-purchase rationalization. That's fine, just don't expect me to believe that wobbly rationale. realtors do this too since it's their job to use any non-sequitur they can to convert ignorant prey into a quick commission. Flexibility today is extremely important. If your job or familial conditions change drastically, you're probably going to have to make some painful and expensive decisions which as a renter wouldn't be an issue.

-Owners build "equity", where renters avoid risk. The latter situation paints the stark reality over the prior situation, particularly over the past several years. Anybody using the "equity" argument for home-ownership and isn't talking about a 10+ year MANDATORY ownership period ought to think long and hard about where they are getting their information. If it's from NAr and they believe it, they are in for a rude awakening.

-Owners have "fixed" payments where renters are subject to the whims of a cruel and selfish landlord, raising the rent price every year by amounts far exceeding inflation. In actuality, the rental market is a very free market. My landlord could double the amount I pay per month, but I would simply move down the street to another rental house at a fairer price. It's simple supply and demand, and rental prices rigidly track household income. Owners also do not have fixed monthly payments. Their property taxes and insurance are basically guaranteed to go up every year. One phenomenon I've noticed is that during the housing bubble, property tax revenue almost doubled in just a few years for many municipalities, because the multiple remained unchanged while values went up. When values started correcting, the municipalities (some, not all) began increasing their multiples to keep revenues as close to their bubble-levels as possible. So owners are getting doubly fucked.

But in the eyes of realtors and euphoric, post-purchase-rationalizing new homedebtors, any distinction from renting is a good thing. It has reached such desperate levels that they want us to believe it's worth a six-figure price to paint your walls (which, most renters can do as well), or to endure the burden of paying $4000 for a new HVAC system. If I wanted to drop 20k into fixing up my crappy kitchen, my landlord would love it. He has a spot for a garden behind the house. If I wanted to, I'd use it. All of these platitudes about ownership are pretty meaningless, and are used to appeal to people's emotions. It's the oldest marketing tactic known to mankind, and there's no shortage of people willing to buy into it today.

ch_tah says

You are arguing certain items are not benefits because there responsibilities or drawbacks.

Isn't that the definition of a trade-off, not a benefit? This is absolutely a semantics issue, because you're calling something a benefit when it's actually a liability or detriment.

ch_tah says

The way you describe homeownership, I wonder why you would ever want to own a home.

So one should believe in false platitudes and bullshit about owning if they were to buy? You must not really believe there's a benefit to owning if you believe that.

ch_tah says

What good is there to owning if it just means you have additional liability? More specifically, if your rent payments and your house payments would be the same, yet you have these additional liabilities, would you purchase? If so, why?

There are long-term financial benefits to owning a house. As in, VERY LONG TERM.

How can you defend those dumb platitudes in the article about painting a wall, yet not know the number one reason to buy a house?

Klarek, your objective statements above are generally valid. The rest is just your typical overly pessimistic, remove all feeling and joy out of everything, condescending crap.

With housing such an absolute disaster waiting to happen, it doesn't make any sense for you to ever buy a house again. I really don't know why you have been making offers over the past few months. Clearly renting is better which is why everyone on this board posts "at some point, I'd like to buy."

klarek says

Isn’t that the definition of a trade-off, not a benefit? This is absolutely a semantics issue, because you’re calling something a benefit when it’s actually a liability or detriment.

So having the option to remodel a home is not a benefit because owning the home comes with the liability of having to pay for a new garage remote? That makes no sense. Using that logic, making lots of money as a successful business owner is not a benefit because you open yourself up to product liability claims by having such a business or because you have the added worry that the product will not ship on time.

edited

Schizlor says

This is an oft overlooked aspect of renting too. That many times, you modifying the rental is a BENEFIT to the landlord. Do they “mind” that you want to spend hours upon hours in the garden, making the outside of the home very attractive, neat, and tidy? Of course not. You “modifying” their yard probably just gave them a few thousand dollars worth of free landscaping.

The way I look at is that its a cross-beneficial arrangement. We've lived in the house for 8 years and in that time we've done quite a bit of work to the yard. Mostly it came in the cost of sweat. In return the landlord hasn't ever raised the rent and we get to have a nice yard that we enjoy. He gets a nicely landscaped yard and assurance that we take good care of his property and in return we pay discounted rent. On the other hand we never have to worry about replacing the roof, repainting the outside, or any other major and costly maintenance issues. What we've done to the house has more than paid for itself many times in the form of added savings for us. Besides- who is to say renters can't have just as much pride in the house they rent? I'm very proud of our home and yard. I may rent it but we've made it our own.

klarek says

Assuming that the monthly cost of owning (30 year fixed rate PITI) and renting (increase with area incomes) is the same for the exact same property

Klarek - you say a lot of smart stuff, just wish you would add in opportunity cost and maintenance/improvements to the monthly costs of owning.

ch_tah says

The rest is just your typical overly pessimistic, remove all feeling and joy out of everything, condescending crap.

There's no "joy" in spending hundreds of thousands of dollars unless you're ridiculously wealthy. This is why I hate realtors, for using emotional appeal to dumb down their prey, to make them mindless consumers who spend less time and objective thought on the biggest purchase in their life than they'd spend on choosing a laundry detergent. The doom and gloom is that we live in a society of mindless consumers; people dumb enough to believe every bullshit, emotional platitude served to them. People who are offended by reality, and live in blissful ignorance.

ch_tah says

With housing such an absolute disaster waiting to happen, it doesn’t make any sense for you to ever buy a house again. I really don’t know why you have been making offers over the past few months.

I just put an offer on a house a few days ago. Being a mindless, emotional consumer is not a prerequisite for home ownership. It just makes your realtor's job a lot easier if your brain is turned off. It's not my fault that you believe in horseshit, and it doesn't make me a "doomer" .

ch_tah says

Clearly renting is better which is why everyone on this board posts “at some point, I’d like to buy.”

I just posted the trade-offs above between renting and buying. It's not as simple as "X is better". I know you like things simplified, hence the platitudes and emotions of ownership are highly appealing to you.

Thanks for proving all of my points. You can't even enjoy a house and focus only on the negative. You are buying despite all of the terrible aspects. You are condescending and are a know-it-all, yet you are posting on an Internet board about how you just put in an offer on a house instead of using your knowledge to become filthy rich from the bursting of the housing bubble. Way to go, Klarek!

Coogan99 says

just wish you would add in opportunity cost and maintenance/improvements to the monthly costs of owning

It was sort of implied above in the part about increasing costs and risk, but I should have included it as a point of its own since ch_tah is having trouble absorbing it, despite that it was mentioned four times above.

ch_tah says

So having the option to remodel a home is not a benefit because owning the home comes with the liability of having to pay for a new garage remote?

It's a trade-off. Not everybody cares about remodeling, or even wants to pick up a hammer. You're assuming that every owner is their own Bob Vila. A benefit would be buying a piece of land and discovering an oil well on the property.

ch_tah says

Using that logic, making lots of money as a successful business owner is not a benefit because you open yourself up to product liability claims by having such a business or because you have the added worry that the product will not ship on time.

Money is tangible and doesn't come with inherent trade-offs. Look at Warren Buffett. He's the richest man in the world, has lived in the same house since 1958, probably doesn't have any sort of security, and could even walk the streets without being noticed. So I don't think your analogy works here.

ch_tah says

You are buying despite all of the terrible aspects.

I have contingencies, counterweights, and thresholds for all of the "terrible" aspects of ownership. I am extremely picky, and I look at it beyond just the cost, which I have been modeling for a while. For instance, I look at the house's utility. Will it suit me in ten years? What if I'm married with three kids, will it suit me then? What will traffic congestion and energy costs mean, both in terms of my commute and my monthly utility bills? How much will I have to invest in the house to keep it "current", what timeline would I need to do it in, and what are the alternatives if I can't? What if my job moves to Colorado, can I rent the house out at the cost of what I'm paying per month, minus the maintenance/management of the property?

There are dozens of more thoughtful questions people should ask themselves and think about before buying than "this room would look great in green".

ch_tah says

You are condescending and are a know-it-all, yet you are posting on an Internet board about how you just put in an offer on a house instead of using your knowledge to become filthy rich from the bursting of the housing bubble.

I have no interest in getting filthy rich, or even rich, and just want to avoid making a mistake which will put me through years of financial pain and regret. Too many people have shifted from euphoric daydreamers to post-purchase-rationalizers to being outright miserable. Some scumbag realtor took advantage of their trust, brainwashed them with emotional propaganda, and it took years for them to wake up. Watching that transition is heartbreaking.

edvard2 says

The way I look at is that its a cross-beneficial arrangement. We’ve lived in the house for 8 years and in that time we’ve done quite a bit of work to the yard. Mostly it came in the cost of sweat. In return the landlord hasn’t ever raised the rent and we get to have a nice yard that we enjoy.

My landlord has offered me a similar deal. He'll take off a part of my rent if I do the yardwork. I'm very allergic to some of the things in his back yard, so I defer it to him instead, which he doesn't mind.

ch_tah says

More specifically, if your rent payments and your house payments would be the same, yet you have these additional liabilities, would you purchase? If so, why?

Basically what it comes down to is location. Location is everything. Here in VA beach, if you want to be close to the ocean (walking distance was my only requirement when we looked for places to live a year ago) you can rent a condo or a crap house, or you can buy a nice house. The owners of nice houses within walking distance of the beach do not rent annually. They rent seasonally, and they are very expensive obviously. You cannot rent a nice home near the ocean by the year for a reasonable price; you either pay the premium (like 2 grand a week) or you get a marginal house that no vacationer wants to rent by the week, or a condo/apt.

I guess for me personally, it's comparing apples to oranges. I would not usually rent the type of house I'd buy, and I definitely would not rent a place to live that I'd want to turn around and buy. If Im renting, Im doing it for value. Currently we rent to save for a home purchase, so we balance location with the need to not spend lavashly on a rental when we should be stashing that money away for a home. If I buy, I want quality and will pay a premium. So to me the idea that I can modify the home if I own it is a foregone conclusion, and I don't put it in the "benefit" category per se.

It would be like saying one of the benefits of marriage is getting to have sex whenever you want. Which is all well and good, except that it's not mutually exclusive. There are plenty of married people having no sex, and plenty of people having lots of sex who are not married. So the argument that regular sex is a "benefit" of marriage, is thin at best. Regular sex is a benefit of having a significant other, not exclusive to married people. Having someone to take care of you when you're sick is a benefit of marriage. Regular sex is just a possibility when you're married, nothing more. As is the option of messing around with your property if you own it. And not owning the property does not exclude one from modifying it either. As I said before, a lot of landlords welcome you improving their home with your labor. Additionally, I have no desire to do anything with this condo. Like I said, when we buy, we will not buy a condo, so I don't have designs on all the condo upgrades I'll do once we buy our own; I have designs on what kind of house I want and where, that's all. I know I'll be able to modify it if I want to once it's ours, but that's completely peripheral to why we want to buy a home.

The MID is a true benefit. You have to do nothing to get it (besides claim it) after you buy a home, but you absolutely cannot get it if you don't own a home. The two are mutually exclusive, and claiming the benefit requires no additional expenditure from you once you own.

And I'm talking purely this line: "You get to paint your walls any color you wish, without having to clear it with a landlord."

This just sounds like some NAR bullshit propoganda to me. It's a weak argument for owning a home, especially in this day and age. You don't have to ask you landlord's permission to paint the walls yellow? Who gives a flying fuck? That should be #137 on the list of benefits of homeownership, not in the top 5.

Coogan99 says

If you’re honest about these three things, buying almost NEVER makes financial sense over renting. Some SUPER distressed sales have begun to make sense.

That's a completely ridiculous statement. Buying at bubble prices never make sense. Otherwise, assuming you won't be moving any time soon, it almost always makes financial sense to buy. Look at any 15 year period in history and tell me when renting wins.

"Look at any 15 year period in history and tell me when renting wins."

Sure. SF or LA purchased in 1988 or 1989. Houston purchased in the 1980s or afterward. Japan. :)

It's equally ridiculous to give your absolute, as it is Coogan99's absolute. Most people's absolutist statements are ridiculous.

There are many markets right now where buying is cheaper than renting. The Bay Area tends to have the reverse more often.

Buying *should* be cheaper than renting, because of illiquidity, high transaction costs, risk, lack of mobility, etc. Usually when the reverse happens, there's some sort of distortion or other factor causing it.

Schizlor says

This just sounds like some NAR bullshit propoganda to me. It’s a weak argument for owning a home, especially in this day and age. You don’t have to ask you landlord’s permission to paint the walls yellow? Who gives a flying fuck? That should be #137 on the list of benefits of homeownership, not in the top 5.

Wow, 137 benefits of homeownership - you and Klarek should discuss them all; I think he'd disagree with you with the quantity.

I agree specifically, painting walls is a minor benefit; however, the ability to do what you wish with your house overall is a pretty big benefit. Not sure where it is on the list, but if you lump it in to making the place feel like home, where you specifically paint your kids' rooms the way you want, and get to see the joy on their faces, I give that a pretty high value. I'm not saying you can't do this if you rent, but for us, when we did rent, we couldn't.

tatupu70 says

Look at any 15 year period in history and tell me when renting wins.

The average American family moves every seven years. But go ahead and position your goalposts however you can to make your point.

klarek says

It’s a trade-off. Not everybody cares about remodeling, or even wants to pick up a hammer. You’re assuming that every owner is their own Bob Vila. A benefit would be buying a piece of land and discovering an oil well on the property.

You are the one painting everyone with the same brush. Yes, for some, having to do repairs is actually fun. For others, painting is fun. Others, yardwork is fun. For some, none of it is fun. Obviously, for the last group, these aspects of homeownership are not a benefit to them. That doesn't mean it isn't a benefit to the rest. For some reason, you think everyone should think and feel the same way you do. Just because you don't like yardwork, doesn't mean someone else is an F'n idiot for having a garden.

ch_tah says

and get to see the joy on their faces

I guess NAr also suckered you with the "own or your children will be miserable" propaganda.

-Appeal to emotion.
-Dumb them down.
-Get them to stop thinking.
-Use fear, and parental guilt.
-Nobody can stand being thought of as a bad parent.
-Equate home ownership with being a GOOD parent.

klarek says

The average American family moves every seven years. But go ahead and position your goalposts however you can to make your point.

I'm not positioning goalposts. Coogan is. I'm just pointing out that he's wrong.

klarek says

I guess NAr also suckered you with the “own or your children will be miserable” propaganda.

-Appeal to emotion.
-Dumb them down.
-Get them to stop thinking.
-Use fear, and parental guilt.
-Nobody can stand being thought of as a bad parent.
-Equate home ownership with being a GOOD parent.

I'm not sure why you paint me with the falling for NAR crap. I had a list similar to yours above. We did very thorough analysis before we bought. We couldn't have cared less what color the walls were. However, I don't feel the need to attack others for such a preference.

corntrollio says

Sure. SF or LA purchased in 1988 or 1989

Well, I think 1988/89 is very close to bubble territory, but we'll check it anyway. Guess what, prices doubled to 2003.

Japan--bubble.

Houston looks pretty good too. If you bought in 1987, you are up ~80% over 15 years.

ch_tah says

I’m not sure why you paint me with the falling for NAR crap.

Because practically every reason you present or defend re: home ownership is crap that NAR puts in their commercials. They even managed to squeeze it in this awful ad:

http://www.youtube.com/watch?v=Ubsd-tWYmZw

Let's make it about the children, because you can't live in a good school district unless you own, so call a realtor today!

ch_tah says

For some reason, you think everyone should think and feel the same way you do. Just because you don’t like yardwork, doesn’t mean someone else is an F’n idiot for having a garden.

I don't dislike yardwork at all. I just have some particular allergies and would rather not do it for the house I'm renting. I also have this handy slave called a "landlord" that comes and does it for me.

My point is that you are still confused as to what a "benefit" entails. You eat up the NAr bullshit and assume that if parameter differentiates owning from renting, it is a benefit. It's not, it's a trade-off. Like owning a big car versus a small one, having a cat versus a dog, and taking the highway versus the backroads. If somebody is trying to tell me there is net or inherent benefit in any of these things, I'd be skeptical about what they're trying to sell me. In your case, you're just drinking the koolaid that some realtor gave to you.

That isn't a personal attack or an insistence that you agree with my views, I just don't think you understand what the meaning of "benefit" is when it comes to housing. NAR has sold to you the euphoria and responsibility of ownership which you are still only looking at from the lens they had you view it through. Over time you'll figure it out. All it will take is two back-to-back emergency repairs/accidents and you'll snap right back into reality.

tatupu70 says

Well, I think 1988/89 is very close to bubble territory, but we’ll check it anyway. Guess what, prices doubled to 2003.

Nothing wrong with bubbles -- you would include bubbles in price increases, so why can't I include them in price decreases? How about Los Angeles County from 1982 to 1997 (http://www.laalmanac.com/economy/ec37.htm). It went up 48.0% for median price, inflation was 66.3% (per CPI). That's without considering costs of ownership in 15 years. Yes, that's from the 90s bubble in housing.

You are selectively picking years for Houston, which got slaughtered even without considering inflation:

http://money.cnn.com/2005/09/19/real_estate/buying_selling/price_declines/

"Oil patch" cities, suffered even sharper declines. In Oklahoma City prices plummeted 26 percent from 1983 to 1988. It took 15 years for prices there to return to nominal 1983 levels.

Houston home prices fell 22 percent from $111,000 to $86,800, and also took 15 years to rebound.

Counting inflation, the average Houston home, which cost just $159,700 in 2004, is actually worth less now than it was 22 years ago. When, adjusted for inflation, a home cost about $219,000 in 1983. In Oklahoma City, the inflation-adjusted price in 1983 was $196,600. Today, it's just $135,100.

ch_tah says

Not sure where it is on the list, but if you lump it in to making the place feel like home, where you specifically paint your kids’ rooms the way you want, and get to see the joy on their faces, I give that a pretty high value.

We clearly have different value systems. I grew up with rooms with white walls and can tell you the color of the walls had very little to do with my happiness or sadness. :) This is specifically buying into a bizarre form of marketing. It's also trivial to do as a renter unless you're a crappy tenant or have a crappy landlord.

Anyway, I think the point is that people have different reasons to buy, and different people see value in different things. Some people hate having landlords, but maybe they've always had crappy landlords. Who knows?

As I've mentioned before, it's also reasonable to buy a house as *consumption* (as opposed to investment) when the rent vs. buy calculation doesn't make sense, as long as you understand that it's consumption. Many people don't understand that, however, because most people don't do the math.

This is all still a far cry from the nonsense from NAR about investments. Most realtorsused house salesmen wouldn't know an investment if it bit them in the ass. When most realtorsused house salesmen are talking about investment, they're either talking about speculation or forced savings. Neither is likely the ideal form of investment for the typical primary residence owner.

First - to clarify - when I say its almost never cheaper to buy than rent, I mean if you look at individual properties today, and estimate what they could rent for.

But to answer the question: 15 year period ending today.

Assume you had a 30yr mortgage @ 8.4% 1994 to 2001
refi #1 7.0% 2001 to 2005
refi #2 5.6% 2005 to today

Case Schiller is up from 78 -> 125 = 3.2% annual home price appreciation

S&P 500 annualized 1994-2010 6.58%, lets call this opportunity cost
http://en.wikipedia.org/wiki/S%26P_500

Taxes ~1.25%
Maintenance and improvements ~1.25%
Transaction costs in year 15 come out to ~0.5% per year

So you've borrowing money from the bank at ~5% after tax deduct
and you've borrowing money from yourself at ~6.58%

to invest in an asset which appreciates at 3.2%-1.25%-1.25%-0.5%= 0.5%

Beyond that, rent vs buy is property specific, but its clearly not a home run. **Historically**, aka any period that doesn't end in 2004,2005,2006,2007, a home only "really" appreciates at ~0.5% after non-interest expenses. This 15yr period is very close to the numbers for 1900-2000, fyi.