patrick.net

RentingForHalfTheCost says

Bigsby says

Nothing in life is risk free. You make the decision that is best for you based on your current circumstances.

Finally something I agree with you on. I see little risk in renting in the BA and lots in buying right now. You see it different. Good luck to you.

I couldn't care less what you do. I don't live in the BA and I don't rent. However, you can keep parroting your line all you like and if you are happy renting then fine. There will, more than likely, come a time when you will be less happy about it. You'll just have to see how many years you spent renting and what the current house prices are in the BA when that time comes. It doesn't look that great for you as things stand.

wthrfrk80 says

Bigsby says

I just 'smeared' the term? Don't be silly.

Usually when people say "living paycheck to paycheck" they mean not having any money stashed away and needing the next paycheck just to cover basic essentials. In other words, they have no "emergency fund."

And I'm still hardly smearing the term, am I? And if you look back, I was actually making the point that most people don't save a great deal of money and live little over cheque to cheque. If I didn't keep restating that exact point, then please forgive me. The actual comment that caused RFHTC to get his knickers in a twist was as follows:

You say that, but looking at the rate at which people save, then a great many people clearly live little beyond pay cheque to pay cheque. That doesn't mean they can't buy a house. Maybe they've saved some money in the past, or have inherited money, or live in the great swathes of the US where house prices are very reasonable. Why exactly shouldn't those people buy homes?

RentingForHalfTheCost says

Bigsby says

Nothing in life is risk free. You make the decision that is best for you based on your current circumstances.

Finally something I agree with you on. I see little risk in renting in the BA and lots in buying right now. You see it different. Good luck to you.

This pretty much sums up 99% of all RE threads here.

Okay Patrick, we can shut down the RE forum now.

Bigsby says

RentingForHalfTheCost says

You just smeared the definition of living check-to-check. If you have ever been in that situation then you would know this. It means not having money stashed away for anything. It means hoping for that next check to cover the bills. I know more than one home-owner in the BA that is in this boat.

I just 'smeared' the term? Don't be silly.

Say that to people who actually do live check-to-check. Make sure you have a mouth guard in place when you do. ;)

RentingForHalfTheCost says

Say that to people who actually do live check-to-check. Make sure you have a mouth guard in place when you do. ;)

That post makes no sense. And why not look back at the comment I just reposted above and explain to me exactly why you got your knickers in a twist over it.

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Make 359 payments and miss that 360th payment and watch what happens to your house.

To the OP, generally the difference between renting from the bank and renting from a landlord is that the individual renting from the bank put down a down-payment, which carries a certain amount of lucre. But to be fair, that's not even completely true always.

There are folks with FHA loans that are putting down in the ballpark of rental security deposits.

wthrfrk80 says

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Yes, yes, I'm sure that saying people who save only small amounts and live little beyond pay cheque to pay cheque can still buy homes constitutes a smear on the term and warrants physical violence. Clear indeed.

wthrfrk80 says

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Yes. People living check to check handle conflict with violence. RentingForHalfTheCost ironically has stereotyped the working poor while defending them.

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

Bigsby says

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Bigsby says

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

Well yes, lol, but then watch what happens with your 29.917 years of payments (on top of your original DP) after that.

Call it Crazy says

I wish I had a nickle for every time I've heard this arguement...

So, tell me, how many people do you know have lived in their homes for 30 years??

Exactly my point. You missed the sarcasm - most bulls put up this argument.

Bigsby says

You'll be able to live in your house rent free for a year or two?

Ok ok...you win!

I think RFHTC was assuming the quaint old notion that you actually have to make mortgage payments on time.

rowemoore says

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Does that 400% include inflation?

Over the long term, RE prices generally track inflation, unless something "big" happens locally (discovery of gold/oil/big company moves in/etc).

wthrfrk80 says

Bigsby says

You'll be able to live in your house rent free for a year or two?

Ok ok...you win!

I think RFHTC was assuming the quaint old notion that you actually have to make mortgage payments on time.

Err.....

Call it Crazy says

I wish I figured this out a LOONNNGGGG time ago.....

Haha. Unfortunately most wait so loooonnnggg to figure out,oh shit - we are screwed.

rowemoore says

wthrfrk80 says

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Yes. People living check to check handle conflict with violence. RentingForHalfTheCost ironically has stereotyped the working poor while defending them.

Not at all what I meant. You mouth off arrogantly about how you know what other people live like in front of them, and I don't care what class you are talking to. If they don't hit you, and I was walking down the street in wind of the conversation then I would. ;) Bigsby has never lived check-to-check and doesn't really know what it means to do as such. No family living check-to-check should buy a house. Period. The responsibility is too much. If you can manage to get yourself not living check-to-check and save enough for a down-payment, then go for it.

Bigsby's thinking is exactly why we are in such a mess. It is the middle class thinking they understand how everyone lives. They don't. You see it in the Hollywood movies, you see it on this forum, you see it in the tax system. Total ignorance all across the board. Good luck to all, even the ignorant. ;)

wthrfrk80 says

rowemoore says

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Does that 400% include inflation?

Over the long term, RE prices generally track inflation, unless something "big" happens locally (discovery of gold/oil/big company moves in/etc).

I didn't say Corning, I said San Francisco. But most RE in California has seen this kind of growth over the past few decades, even factoring in inflation and the recent crash.

Will it continue? Only in really, really special places. (i.e. ocean view and the super fortresses). Demographics and continued job erosion will keep home prices flat, IMO.

You are correct though. My wife's family sold their upstate New York home for a loss in 2005. They bought in 1975.

RentingForHalfTheCost says

CaptainShuddup says

Of course I'll be able to do so, with the tax ramifications of taking money out of a retirement account or 401k.

Don't buy, I'll buy in your stead.

Two wrongs don't make a right. i.e. take money out of your appreciating 401k to leverage the funds to buy a depreciating asset (house). Oh boy...

OOPS my bad, that should be "With OUT the tax ramifications" I was trying to illustrate that I do not have a 401K or a neo-traditional which would be the anti traditional retirement plan, i.e. one that actually accrued interest and appreciated YOY and never EVER went down in value.

rowemoore says

Bigsby says

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Past performance is not a guarantee of future performance. In this case it might actually be more of a guarantee of shit performance. ;)

RentingForHalfTheCost says

If they don't hit you, and I was walking down the street in wind of the conversation then I would. ;)

No you wouldn't. And I highly doubt you'd argue that a guy making 1 mil/yr would punch some guy making 20 mil/yr if the latter made an arrogant comment about the former's lifestyle.

RentingForHalfTheCost says

Bigsby's thinking is exactly why we are in such a mess. It is the middle class thinking they understand how everyone lives. They don't. You see it in the Hollywood movies, you see it on this forum, you see it in the tax system. Total ignorance all across the board. Good luck to all, even the ignorant. ;)

Do you mean the propping up of the "American Dream"? If so, I wouldn't blame that on the "middle class".

RentingForHalfTheCost says

Bigsby has never lived check-to-check and doesn't really know what it means to do as such. No family living check-to-check should buy a house. Period. The responsibility is too much.

You have no idea what I've experienced in my life. I am from a working class English family if you really want to know. Yourself?
And you also continue to twist what I actually said. Very convenient.

RentingForHalfTheCost says

rowemoore says

Bigsby says

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Past performance is not a guarantee of future performance. In this case it might actually be more of a guarantee of shit performance. ;)

Depending on the investment, you are probably right. But that wasn't what I was saying. The comment was that if you missed the last payment on a 30yr mortgage, you'd be screwed. I pointed out that in San Francisco, or Foster City for that matter, you'd come out fine. I'm sure you'd agree. After all the reason you can pay such low rent in FC, is because your landlord bought many, many years ago.

rowemoore says

wthrfrk80 says

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Yes. People living check to check handle conflict with violence. RentingForHalfTheCost ironically has stereotyped the working poor while defending them.

Also, FYI it is not just the working poor living check-to-check in this country and especially the BA. Many high paid families are living check-to-check because of their beloved realtor/bank. I'm talking families making 6 figures. 25% of families with mortgages are underwater in the BA. You don't think many of them are squeezed? I know many that are, and any hiccup will cause them to be renters again. Yah, great time to join the chaos. Not for the weak of heart. Good luck to all the over-fertilized yards out there.

RentingForHalfTheCost says

specially the BA. Many high paid families are living check-to-check because of their beloved realtor/bank. I'm talking families making 6 figures. 25% of families with mortgages are underwater in the BA. You don't think many of them are squeezed? I know many that are, and any hiccup will cause them to be renters again. Yah, great time to join the chaos. Not for the weak of heart. Good luck to all the over-fertilized yards out there.

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

RentingForHalfTheCost says

Yah, great time to join the chaos. Not for the weak of heart. Good luck to all the over-fertilized yards out there.

You seem angry on other peoples behalf. Your situation, as I recall, is very sweet. Low rent, very nice pad. I don't understand the reason for the vehemence in your post. While buying now may not be the best investment (in your opinion) there is no way banks are going to let someone get in way over their heads like they did a few years ago. So the risk of the current RE market fucking up the economy is relatively weak.

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Absolutely...if it costs $600k for the the house.

It's all about the ratio of price to income.

BayArea says

Well yes, lol, but then watch what happens with your 29.917 years of payments (on top of your original DP) after that.

Presumably, one would be intelligent enough to put their home up for sale rather than let the bank take it after paying on it for 29.917 years.

Please don't telll me that they are underwater after 29.9 years of payments...

rowemoore says

No you wouldn't. And I highly doubt you'd argue that a guy making 1 mil/yr would punch some guy making 20 mil/yr if the latter made an arrogant comment about the former's lifestyle.

If I was scammed into buying a piece of the American dream only later to find out that all I was doing was paying down some realtors Mercedes and adding a fresh layer of white marine paint on some bankers oversized yacht I would be pissed already. Many are and they should be. Now someone who doesn't know me comes around and joins the mix. I tell them I am living check-to-check and they say I probably have a good cash savings. I say "huh? No". Then they say "What? that is silly". Yup, I would punch them, and it wouldn't matter what financial class either of us were from. Done deal!

wthrfrk80 says

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Absolutely...if it costs $600k for the the house.

It's all about the ratio of price to income.

Glad someone is paying attention here.

The "bank" owns people's houses until the mortgage is paid off? What if they buy their homes for cash from the beginning? Then none of those pesky banksters ever get to take a cut.

Now if you could just prepay a lifetime's worth of property taxes in advance, then you really would own your home.

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Shouldn't buy a 1+ million dollar home with 20% down when the 20% down is all their savings. Add a 30% crash and now you lost your savings (100%) and are living check-to-check. Awesome stuff!

the people living check to check who bought in 05/06 and put zero down and then took massive HELOC (never to be repaid) and then lived there rent free 3 years before getting foreclosed and then getting 2k cash for keys did pretty well.

sorry for run on sentence! ha.

In general, I agree with the assessment that it is not a good idea to buy for only a 5-7 year period if all you do is make minimum payments. This is not guaranteed to beat renting in normal circumstances. However, if you prepay the principal (which implies that you did not buy above your means) and kill the debt in about 10 years - then you have options: 1 - sell and rent, 2 - keep the pad and "collect the dividend" - difference between market rate rent and your property tax + hoa payment plus whatever writeoff you can generate off the property tax or 3 - use the completely paid off home - your equity to move up to new home and again borrow below your means. I think the person in this situation can fully assess their option and their option pool will clearly leave them in a better situation that either the renter or someone who only made minimum payment on mortgage.

Bigsby says

You'll just have to see how many years you spent renting and what the current house prices are in the BA when that time comes. It doesn't look that great for you as things stand.

What the hell are you talking about. Every year since 2007 I am in a better and better situation. Next year will be the same I'm sure. And the year after and after. I'll buy when I think that trend will stop. We are not even close yet from where I stand. Geesh.

RentingForHalfTheCost says

Yup, I would punch them, and it wouldn't matter what financial class either of us were from. Done deal!

And you would go to jail and/or be sued.

I guess I don't OWN my LIFE or my FREEDOM, since I have to pay all kinds of taxes to the government. If I don't they will lock me up. Try not paying income taxes and see what happens.

These threads are stupid, and a waste of time.

rowemoore says

RentingForHalfTheCost says

Yup, I would punch them, and it wouldn't matter what financial class either of us were from. Done deal!

And you would go to jail and/or be sued.

Then I would get the best deal possible. My rent paid for by the taxpayers. Do I own my cell? I can paint and put as many holes in the cement walls as I like. That qualifies for owning in many people's eyes.