Renting houses forever seems like a smart idea

HI JAMIN!!!!

Real estate values can go down but stocks always go up?

For me, real estate ownership is all about lifestyle choices. If you intend to plant roots and committ to really settle down into an area then real estate ownership is 100% the right financial move: Aporeciation in value, tax deductions, insanely low interest rates that can be locked in for 15 to 30 years, saving on costs associated with the disruption of frequently moving, protection from rent increases, protection from being forced to move (i.e. Landlord decides to sell or jack up rent). Over time, rental rates increase. Yet if you own your house then mortgage stays constant for, potentially, 30 years. That really adds up over time.

However. If your lifestyle choices involve moving every few years then Holme ownership can be a financial disaster for many reasons.

John Utah wrote:

However. If your lifestyle choices involve moving every few years then Holme ownership can be a financial disaster for many reasons.

I know a lot of people who have moved every few years and had the opposite experience.

an actual vet wrote:

John Utah wrote:

However. If your lifestyle choices involve moving every few years then Holme ownership can be a financial disaster for many reasons.

I know a lot of people who have moved every few years and had the opposite experience.

There are a lot of individual situations here, but the guide has always been that you need to remain in a house for 5 years to earn the money spent on buying the house. If a person was jumping around during the boom days then he/she could come out ahead.

The tax deduction aspect can be a little overblown.https://www.forbes.com/sites/realspin/2013/12/18/mortgage-interest-deduction-saves-middle-class-taxpayers-all-of-51month/#76dd50d2105c

luv2run wrote:

an actual vet wrote:

I know a lot of people who have moved every few years and had the opposite experience.

There are a lot of individual situations here, but the guide has always been that you need to remain in a house for 5 years to earn the money spent on buying the house. If a person was jumping around during the boom days then he/she could come out ahead.

The tax deduction aspect can be a little overblown.https://www.forbes.com/sites/realspin/2013/12/18/mortgage-interest-deduction-saves-middle-class-taxpayers-all-of-51month/#76dd50d2105c

Usual rotation was 3 years and sometimes we bought and we rented other times. The thing was, for a given house a mortgage payment was substantially lower than the monthly cost to rent in the same neighborhood. Someone always built a spreadsheet to figure out the difference in costs, assuming certain resale prices and rate of return the down payment would earn if they rented. The numbers were never compelling enough to make an overwhelming case in favor of either decision.