patrick.net

I had a solid offer on my house for 375k that I turned down. I purchased at 395k, so I guess I'm off by 20k, not including the Realtor commission. Assuming a 5% commission at 375k, that's $18,750 + 1% Real estate transfer tax ($3,750), $20k less in price, that's a loss of $42,500. That's a total of 11% loss overall. I said it before and I'll say it again, desirable properties lost less in this housing market downturn and will recover first.

I did put about 30k into the property, so I guess technically you have to count that as well, that brings my total up to $72,500 or down 18%.

It's the cookie cutter houses in developments and McMansions on undersized lots lost the most dollars percentage wise.

1. My primary residence I bought in 2000 for 436k could probably sell for 650k.
2. My 2004 rental bought for 176k could probably sell for 165k.
3. My 2005 rental bought for 204k could probably sell for 170k.
4. My 2011 rental bought for 194k could probably sell for 194l.

I've lost $97,080 renting over the past 5 years.

TechGromit says

I had a solid offer on my house for 375k that I turned down. I purchased at 395k, so I guess I’m off by 20k, not including the Realtor commission. Assuming a 5% commission at 375k, that’s $18,750 + 1% Real estate transfer tax ($3,750), $20k less in price, that’s a loss of $42,500. That’s a total of 11% loss overall. I said it before and I’ll say it again, desirable properties lost less in this housing market downturn and will recover first.
I did put about 30k into the property, so I guess technically you have to count that as well, that brings my total up to $72,500 or down 18%.
It’s the cookie cutter houses in developments and McMansions on undersized lots lost the most dollars percentage wise.

interest payments+property taxes(minus deductions) and home insurance would also be sunk costs.

Troy says

I’ve lost $97,080 renting over the past 5 years.

i've paid $120k-$140k over the last ten years renting.

but i probably would have paid in that range for mortgage interest and property taxes (even after deductions) had i bought.

Syphilis says

interest payments+property taxes(minus deductions) and home insurance would also be sunk costs.

The same argument could be said about renting and renters insurance, neither one of those built any equity for you either.

Paid Y14,000,000 (about $130k at the time) for my condo at the end of 2008.

Over the next two years:

-$6k in realtor fees/acquisition tax
-$6k in common maintenance fees (about $250/mo)
-$500 in property taxes
-$500 in insurance

Saved on rent:

+$29k @~$1200/month

Net gain or (loss) : +$16,000
That's more than half a year's after-tax pay, and the acquisition costs were a one-time expense whereas the saved rent will continue to accrue every year. I spent my entire net worth to buy this humble home, and it looks like a better decision with each passing month.

Another room in the same building, less desirable than mine, just sold for the same Y14m I spent on mine, so a conservative estimate says that my value hasn't changed. The dollar has gone down, and now Y14m is closer to $160k. If I were to sell and move back to the USA, my gain would be even more.

Troy says

I’ve lost $97,080 renting over the past 5 years.

Tee hee. You should have "bought" with an ARM, then sit on your ass and not pay, waiting to be foreclosed on! It's the California way!

My home would sell for about 20% less today than it would have in 2006. That's an educated guess based on some research. Not based on any appraisal in 2006 or now.

But I have not lost anything. I still have the home I lived in in 2006. I did not have that 20% fictional value anywhere in actual money. And since I've lived here 20+ years, my mortgage balance is based on a 1990 purchase price. Value drop does not bother me as it would someone who has a 2006 mortgage on a 2011 value home.

Michigana - are you serious? Two years of Property taxes and insurance in Japan are only $500 each? Wow.

Payoff2011 says

Two years of Property taxes and insurance in Japan are only $500 each? Wow.

Probably doesn't include earthquake insurance tho. EQ insurance is something of a scam, it'll only pay 40% of the replacement cost -- any temblor strong enough to take out any random condo in Tokyo would be strong enough to take all of them out so insurance companies have statutory damage limits.

Plus interest rates are like ~1% the first 10 years, and ~2.5% thereafter.

I am reasonably fluent in Japanese so consider it a possible bug-out place, but man does its macro situation bother me. Not the aging problem -- their baby boom was actually only a 5 year thing not the two-decade monster ours is -- just the fact that their current economy is predicated on selling 44 trillion/yr of JGBs, that's $18,000 per working man aged 30-64, or 10% of GDP, about what we're running ATM.

Call me naive, but I think if Japan was actually taxing that $18,000 extra to balance the budget things would be a lot better, and a lot different.

Troy says

I’ve lost $97,080 renting over the past 5 years.

I guess paying for shelter, The most basic of human needs, is wasted money if you rent?

IMO you've only lost what you paid in excess of a basic shelter you silly humans.

America I want my language back!

look these up in a dictionary folks.

homeowner
wasted
asset
liability
insolvent

don't let them steal your words too!

Payoff2011 says

Michigana - are you serious? Two years of Property taxes and insurance in Japan are only $500 each? Wow.

It is like 0.1~0.3% or so of government/city assessed value which is about 60~80% or so of market price. Not only Japan, but few other asian countries are like that. How they manage it with such low tax is amazing, but how US always mess thing up with 10X more tax is even more amazing.

Troy says

Call me naive, but I think if Japan was actually taxing that $18,000 extra to balance the budget things would be a lot better, and a lot different.

Japanese government certainly can do that if they have to, but I can hardly think that's gonna happen. They are too chicken to do something like that especially situation like that. If it actually happens, there must be few disembowelments.

Katy Perry says

Troy says

I’ve lost $97,080 renting over the past 5 years.

I guess paying for shelter, The most basic of human needs, is wasted money if you rent?
IMO you’ve only lost what you paid in excess of a basic shelter you silly humans.
America I want my language back!
look these up in a dictionary folks.
homeowner
wasted
asset
liability
insolvent
don’t let them steal your words too!

One more:

sarcasm

I am just guessing but I would be down about $20k based on a recent appraisal. I was looking at converting a line of credit into a HELOC for a low interest rate and tax benefit. The bank departments fought between each other about the value. I had used them to build the home with about 1/3 down. It would be a little more if you counted tap in fees, and upgrades during the construction process.

The guy that came out to value it seems to me to have come up blank. At the end of the tour he asked me point blank what the contract price was and the land cost. I gave him all accurate figures that did not count the extras and his estimate was exactly spot on. The bank did finally agree to the loan conversion but at a higher rate than I have now and lower credit limit.

I think I will pass at making the current line of credit a secured loan at a higher interest rate :)

I guess I will have to save on the utilities instead. The average Heating Degree Day monthly total for the last 3 months has been about 1100 HDD/month. My highest gas bill was about $100 with a thermostat setting of 75 F. While the average temperature outside has been in the low 20's, I have stayed comfortable.

Payoff2011, yes, property taxes are that low. They're actually 1.4% of assessed value, but buildings are considered to be depreciating assets, and mine (built 1970) has been depreciating for a very long time, by Tokyo standards.

Seaside, a lot of the things that are funded using property taxes in the US (such as schools) are funded by local income taxes in Japan, which can be as high as 10% of your income. So I'm paying several thousand dollars to my municipality whether I own property or not. I must confess that I like this system better. You're still "renting" your home from the government, but as the cost of a few days' wages per year!

Troy, my insurance actually incudes earthquakes, and I'm insured for much more than the government-calculated value of my home. But I think that everybody knows that if an earthquake is big enough to destroy your home, it's big enough to destroy *everyone's*, and your insurer will be out of business and you won't see a dime. It's the fire and structural insurance that matters -- we've already had a problem with the pipes above our room, and while that was the neighbor's problem, my insurance company even paid a small "condolence bonus" to compensate for the disruption to our lives caused by the pipe problems.