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The surprising myth about investing in real estate

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Surprising real estate investing myths: Real estate might be right for you. It might not. But do not make the largest decision of your life because it’s something you “should” do.
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One of my most popular concepts is “Invisible Scripts,” or the guiding beliefs we have that are so deeply embedded, they’re often invisible.

For example:

  • “Everyone should get a college degree”
  • “I don’t have any money, so I can’t go to college”
  • “Marry someone you love”
  • “If you rent, you’re throwing money away”
  • “Online courses are SCAMS”

Here’s an overview of the Invisible Scripts concept, which many of my readers told me changed their lives more than anything else I’ve written.

One of our Invisible Scripts is almost overwhelmingly powerful, causing people to make life-altering decisions for reasons they often cannot even grasp.

It is: “Buying a house is the next step!”

You see, you go to college… get a good job… buy a car… meet a nice guy/girl… then buy a house!

Right?

Interestingly, at least 30% of the “I have a horrible financial problem” emails I get are directly related to people’s mortgages.

And if you’ve read my book, you know that in Chapter 9, I’m critical of people buying real estate because it’s a “good investment” or because they’re “throwing money away on rent” — both of which are rarely true. I also cover some of the numbers on the “Buying a House” section of my site.

It turns out that Americans HATE to hear this.

In a recent article by James Altucher, one of the best writers anywhere, he writes about why entrepreneurs should not buy a house. What I really liked was how he dug into the psychology of owning a house. Predictably, the commenters hate him.

How often do we do something or want something without considering WHY we really want it? For example, if I were to say, “Why do you want to buy a house?” and you replied, “I’m tired of throwing money away on rent,” I would reply: How exactly are you doing that? Can you show me the numbers? If you cannot do that, you are not ready to make the biggest purchase of your life, jackasses.

If you say “Leverage,” and I point out that leverage works both ways, you need to have an answer for that before you drop several hundred thousand dollars.

Finally, if you say “For the tax benefits,” then I would like to invite you to join to a community college class on financial math so that you can understand how the tax benefit really works.

Guys, I don’t think I’m asking too much. If you’re about to make the biggest purchase of your lives, you need to understand the basic concepts of real estate. In fact, I hold you to a higher standard: You need to be at least intermediate, if not expert, for this expenditure that costs hundreds of thousands of dollars.

So while others (especially parents) might urge you to buy a house — “rates are so low right now!” — I hold you to a higher standard. I insist you do more than take catch phrases (“I hate paying my landlord’s rent every month”) and truly understand how real estate works.

For example — if you pay $2,000/month for a mortgage, how much TCO (total cost of ownership) will you actually pay? Would it surprise you to learn that you’ll pay 50% more than your monthly mortgage in additional costs?

Most people would be shocked. But they take their shock out in the form of denial, not further digging. And 3 years from now, they’re saddled with a purchase that they feel cheated about…because they never took the time to learn how it works.

I’m not saying real estate is a bad purchase for everyone. But the vast majority of buyers do not understand how the math works…on the biggest purchase of their lives.

Which brings me to today’s Ask Ramit question from Naomi in New Zealand.

Ask Ramit: Should I invest in real estate – or not?

“I would like to know about property. I’m nearly thirty, and feel like I SHOULD own some property – an apartment, or something. I have $38K saved up, so I could buy something, and possibly rent it out to cover the mortgage. Stocks don’t feel so real to me, while property does. (Probably comes along with being an architect.) I’m curious about how you would decide to buy property – or not.” 

Here’s my response to Naomi:

Real estate might be right for you. It might not. But do not make the largest decision of your life because it’s something you “should” do.

Question: Out of curiosity, who here has gotten pressure to buy a house? What’s the subtle ways you’ve felt pressured? Was it a throwaway phrase, or a subtle intonation, or did someone outright blurt out, “You’re wasting money renting”? Leave a comment below — I’m curious.

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Jamie Anderson
3 years 3 months ago

I’m looking in to buying my first property in the next 6 months and have been asking myself a lot of the questions you mentioned in this post. It’s amazing how the costs all add up when you sit down and start calculating everything!

infmom
3 years 3 months ago
We wanted to buy a house because after 22 years of renting we didn’t want to be at the mercy of a landlord any more. No more dictating whether we could have pets, what we could and do to the house and yard, and no more getting evicted because the landlord wanted to “get rich in real estate.” We spent 2.5 years going around looking at the sorriest dumps you could possibly imagine because that was “our price range” in the early 1990s in southern California. “Our price range” came with a chain, a stake, and a dog dish, basically.… Read more »
Andrew Williams
3 years 3 months ago
Same here – we were fed up with renting after three separate landlords decided they wanted to stop renting and sell instead (and at least one changed his mind at the last minute – too late, we’re not staying now…). There are “hidden costs” to renting too – deposits might as well be burned as you’ll never see them again. The cost of moving house is several hundred a time (not to mention the stress and time), before you even factor in the effort involved in setting up the phone line, notifying all the banks and the driving license agency… Read more »
Sean Hogue
3 years 3 months ago

The key is not buying “too much” house. But home ownership (and rental properties) are fantastic.

Teka
Teka
3 years 3 months ago
I agree with @infmom, I want to buy a house, but not for financial reasons, but because I don’t want to live at the mercy of someone else or their contract. I hate that in my current apartment I can’t have my cat, currently with family. I want to be able to paint and decorate and tear down walls. I want a kitchen garden. My husband wants a work-space where he can tinker and build things. And once future house is paid off (or paid in cash!) not having to pay anyone (except government for property tax) would be great.… Read more »
Heidi Thompson
3 years 3 months ago

I have been asked over and over why I would want to “throw my money away” on rent by friends who can hardly afford their mortgage and have now locked themselves into jobs they hate for the next 30 years. It’s very weird that it’s seen as such a necessity.

Mark Barish
Mark Barish
3 years 3 months ago

This happens to me all the time too. I’ve noticed that it’s usually from the friends of mine with the most student loan debt too. While most have well paying jobs in their fields, it seems they are desensitized to how much money they are on the hook for.

On the other hand, I was able to get a job in my field without a master’s, and have less debt. After being overextended on my car (now paid off), I’m in no hurry to over extend myself again.

Also, I don’t want to give up central air.

Jack
Jack
7 months 21 days ago

Really? So you don’t need a place to rent for 30 years and plan on living out of your car? Got news for you, your friends are building equity and their mortgages are fixed, while rents go up as do their incomes. When the mortgage is paid off, they pay even less than they were before. Still think you’re so smart?

Pascal
Pascal
7 months 19 days ago
Contrary to what Jack wrote, I feel like pointing out that while renting, you’re flexible and can relocate to a new place on pretty loose terms. This way, you can move to a cheaper place, a nicer place, or a place where you have a job offer you prefer over your current one for any reason. It’s also noteworthy that owning a house for an extended period of time infers quite substantial maintenance costs, which really negates the equity building argument because you could build equity by investing that same money into pretty much any investment, while homeowners are kinda… Read more »
Casey Weber McCarty
3 years 3 months ago
As someone married with kids, the convention is that you should *absolutely* have a house because kids belong in houses and never, ever, in apartments. Feh. In our apartment in Columbus, Ohio, decent-sized two-bedroom, two-bath plus room for big patio garden, etc. INCLUDING all & unlimited utilities, $820/month. All the amenities of a house but without having to take care of it. And if it ever becomes a crappy neighbourhood… never more than a year to move with no commitments. Kiddos are going to private school anyway… don’t care about the public school district sucking. Bottom line–cheaper and more time… Read more »
Jeremy Fowler
Jeremy Fowler
3 years 3 months ago

The equation changes once you have kids. Then you want to provide them a room of their own and a place to call home. Having an apartment always feels like a temporary living space, something that someone else owns and you use. Plus, you usually share walls with your neighbors. Which isn’t great for them when your the ones with loud and rambunctious kids. Kids need a lot of room to play, as well as great schools and a good neighborhood to play. Great kid-friendly apartments are hard to find. Decent homes for rent are even harder.

Barbara Saunders
Barbara Saunders
3 years 3 months ago
I grew up in a poor neighborhood where almost everyone owned their homes. I think what you describe is a myth, too. Homeowners with low salaries end up in situations like not being able to pay the light bill because the water heater broke down. So the kids are sitting in “a room of their own” in the dark. In the neighborhood where I currently rent, my neighbors a young family had their car damaged by gunfire the other day. I’ve no doubt they bought HERE so that they could afford to get into the housing market. I can move.… Read more »
Ae Viescas
Ae Viescas
3 years 3 months ago
Having grown up in an apartment, I can safely say that this is not the case at all. You have a lot more room to play in a safe apartment enclosure than a backyard of anything but a mansion. Good public schools mean high property taxes or high concentrations of expensive property, which give an advantage to renters as property taxes are effectively spread out among all renters–thus you still end up paying less for an equivalent apartment in the same neighborhood as a house. Our apartment was a popular choice for families for all of these reasons (including landlords… Read more »
Naomi (a different one)
Naomi (a different one)
3 years 3 months ago

The LL must cover all costs, the same costs one would incur as a homeowner (roof, furnace, taxes), and maybe even some profit. Wouldn’t the LL just pass along those costs to the renter eventually? Over the long term, how can it be cheaper to rent? Why would anyone hold houses as rentals if the rental lost money?

Another way I look at it – if people make money on rentals, then as a renter I am on the losing side of that equation. Landlords and renters can’t both be winners.

Stefanie
3 years 3 months ago
Even aside from Ramit’s points in reply to your comment, consider that… -A lot of landlords are renting out property because they don’t want to sell right now (maybe they don’t like the current market, they’re waiting on local developments to drive up RE costs, they intend to move back to the property someday, etc.). They’re not all operating under the same assumptions and goals, and some are perfectly happy to just cover their costs or come close to it. Some are failed investors who can’t get out of their investments easily and they just want to minimize the damage… Read more »
Chris Yeh (@chrisyeh)
3 years 3 months ago

One of the main reasons the landlords will rent for too little is that they often bought the property decades ago, and have long since paid off the mortgage. The rents they charge are inappropriately low because they are still anchoring the rent on what they paid, rather than what the property is now worth.

Chris
Chris
3 years 3 months ago
Not to mention the real benefit from renting is the ability to depreciate your house values for taxation purposes. Where I live in Texas, this is a huge deal because of the high property taxes (via no state income tax.) I know several people who rent their homes at break even cash flow for the ability to lower their taxable income by 10-12k a year through depreciation. They are obviously making bets the housing market will increase, but your risk/reward scenario changes drastically in that situation versus someone just hoping to bring in a few hundred bucks extra each month.… Read more »
Tim
Tim
3 years 3 months ago
Thank you so much for this. I am 25 and all of my friends are purchasing their first homes, and on top of that quite a few of my friends are real estate agents. I have been asked 100 times why I am not even looking at buying my own home. I tell each and every one of them, that it doesnt make sense. I have pointed out all of the things that you mentioned in this video, when something breaks paying for it out of pocket or making a phone call, adding in the costs of insurance, maintenance, higher… Read more »
Erika Lockhart
Erika Lockhart
3 years 3 months ago
My financial success is based on purchase of my first house. The discipline it took to launch me into homeownership (getting my credit under control and saving some money) led to profitable sale of first home and purchase of two others, one also for a profit, the other still owned. It is definitely part of what we learn but if I had learned from my parents, I would have avoided it–they lost massive amounts of money in a divorce after purchase of a home. Depends on your circumstances. Also, depends on what you want to spend your money on. Granted,… Read more »
Erika Lockhart
Erika Lockhart
3 years 3 months ago

I realize I didn’t really reply to the question. I felt pressured to buy a house because people of my age were expected to get married and buy a house and have a family. It took me a long time (until I was 34) to realize the I didn’t have to have a husband and family to buy a house. I then realized that I ddin’t have to be married and have children to make a lot of other financial decisions.

Barbara Saunders
Barbara Saunders
3 years 3 months ago

Isn’t there an element of timing to it?

A friend of mine pays $800 for a mortgage on a nice home in the East Bay. She bought in 1980. The house is probably worth half a million now.

She NEVER had an income that would have allowed her to buy the place at the $500M price. Yet she’s had an entire career and has a fairly comfortable retirement. Salaries for the same jobs have not gone up by that much.

Jeffrey Rosan
3 years 3 months ago
One goal all of us should have is to be able to burn a mortgage some day. Getting there without going up in flames, that is the trick. I have gone up in flames several times due to my ill advised purchasing of a home. You are very correct in making your assessments here. I often tell folks…do not try and fit a square peg into a round hole, when it comes to purchasing real estate. In other words you must be in an area where you intend to stay, buying at a price you can readily afford (including all… Read more »
Terrance Cormier
Terrance Cormier
3 years 3 months ago
I have owned and prospered with real estate and you are neglecting the real question. The question wasn’t “Should I buy a house?”, it was “Should I buy real estate?”. The question even mentioned the idea of renting it out to cover the mortgage. There is no better investment in most jusistictions than real estate. In this model the person could buy a property worth 75% more then he/she has the funds for and let the bank mortgage cover the other percentage that the renter will pay over time. In twenty year the property will have been paid off by… Read more »
Jarrod
Jarrod
3 years 3 months ago
There are no free lunches. Real estate investment, to be profitable, is a full-time job for someone – whether you hire someone to do it or you do it yourself. You have to find renters to fill the property, since every period the property is vacant takes money directly from your pocket for the mortgage. But just having a tenant isn’t enough – it has to be a good tenant, someone who will pay on time and not destroy the property. Some states make it incredibly hard to evict a tenant, and even if you are able to do it… Read more »
Travis
Travis
3 years 3 months ago
We are about 4 years away from paying off our home. I took the 15 year loan rout and I’m currently paying double payments to pay the house off as soon as possible. That might look like a waste of money but it will put me in a great position to buy rental property once this house is paid off. So I think for me buying the house was a good idea since we didn’t over purchase and our house payment will be gone relatively soon. No I just need to learn about the “making a profit from renting” side.… Read more »
Maura Shannon
Maura Shannon
3 years 3 months ago
I bought my house in 1990. I live ia a high-cost town. Shortly after I bought my house, prices dropped and stayed low for years. My house will be paid for in 5 years. right now Ihave several hundred thousand in equity. And I was able to refi at a low interest rate, so my payments are now less than renting a similar house. If I want, when I retire I can rent my house out for more than the mortgage payment for a nice stream of cash flow. I can move to a lower cost area and make money… Read more »
Jason
Jason
3 years 3 months ago
I’m single, and I bought at a bad time–the end of the housing boom in 2004, but I think Ramit would agree that in my situation, it was the right decision, even despite the bad timing. I needed a place to live, but I didn’t need more than one bedroom. So, since I had the resources, I bought a 3-bedroom condo with the intention of living in the master to have a private bathroom (I was 33 so I was due), where I could control everything about my living environment, get the benefits of home ownership and collect rent on… Read more »
Clare
Clare
3 years 3 months ago
I own a commercial real estate company in San Francisco and I rent a three bedroom, Victorian apartment about one block from Duboce Park. I can’t even count the amount of people who have asked me, ‘how come you didn’t buy a place?’ My typical response is, BECAUSE I’ve done the math. For me to own what I live in, my mortgage would be double and on top of that, I’d have a whopping $12K property tax bill each year, not to mention general maintenance and repairs. I’d be NUTSO!! San Francisco is one city where it rarely makes sense… Read more »
linda
linda
3 years 3 months ago

My father always told us that renting was throwing money away.
My mother-in-law was fixated on our saving money to buy a house as soon as we got married. This became an obsession with her and she kept pressuring my husband — as if this was more of a priority than anything else, including getting along as a couple.

sstjohn
3 years 3 months ago
I will be 40 this year. I know that is no real reason to base purchasing a home solely upon, but I have rented since I got out of college and I noticed I was spending money to update the houses I rented more and more. Sure, I got a rent deduction based on reimbursement, but the thing is, some other renter (as well as the landlord) are benefitting from my hard work and ambition, whereas I will never enjoy it ever again. The money and time were just thrown away as far as my enjoyment in the long run.… Read more »
Matt K
Matt K
3 years 3 months ago
I used to be in the same mode of thought as you, Ramit. But now I’m thinking differently when I put in the perspective of retirement. IF I BUY PROPERTY: Whether or not I am paying the monthly mortgage or a tenant is, the real draw to me is that once the property is paid off in 30 years or less, its now a form of passive income that can support me indefinitely through retirement. Since I have no idea how long I will live, and the thought of saving up a specific dollar amount to live off of, I… Read more »
Lucy P
Lucy P
3 years 3 months ago

I love renting because I can pick up and leave if I change my mind after a year. But I can’t wait til I am able to buy my own piece of property so I don’t have to deal with so many rules: no pets, no noise after this time, shared laundry room, random people coming in and out of the building. I wouldn’t do it alone though.

Kevin
Kevin
3 years 3 months ago
My personal pressure to buy a house is primarily a situational one, and I think it’s relatively time-sensitive, as well. I’m a recent college grad (also an architecture major, like Naomi), I own 30% of a my family’s construction firm, and I live five minutes from a Sandy-ravaged barrier island in New Jersey. I’m currently renting an apartment above our showroom space, and I want to keep my living arrangement exactly as it is: at $800/mo plus approximately another $100 in utilities with zero commute, I’m living quite comfortably on my salary (I only take $40k in paychecks, but my… Read more »
Kate
Kate
3 years 3 months ago

Don’t forget to take into consideration the costs of flood insurance in that area as well as the cost to repair from future floods, depending on how close to the beach those houses are. That area has been hit twice in the last few years with storms, so seems to be a fact of life now.

Tom
Tom
3 years 3 months ago

I can say as a person who owns 11 properties, 1 in which I live that if you are looking for an investment it’s fine to buy a property to rent out to others to get the cashflow from the property but only if it covers the mortgage and all other bills and puts money I your pocket every month and as you use leverage (borrow on a mortgage) it will increase your returns on investment. It’s better than a bank account, but buying one for you to live in will just suck money out of your pockt

Shawn
Shawn
3 years 3 months ago

I love how everyone assumes they’ll be able to rent out their place for a profit so easily

Kevin
Kevin
3 years 3 months ago

Though, if you’ve got the stomach for it and your municipality approves your property, you can have your very own Section 8 property. With the current waiting lists, particularly in metropolitan areas, you’re not likely to be at a loss for tenants. That’s not nearly the whole story, though.

Rina
Rina
3 years 3 months ago
Yes, I experienced this myself with one month of Vacancy. In my scenario is that I have hired a bad real estate agent. As soon as I changed to a new one, I got tenant straight away. My reason that I bought that investment property is tax benefit – only available in NSW, Australia. I have done researched, compared and shopped around. It’s a brand new estate with 10 yr warranty so I don’t have to worry much about fixing cost. Vacancy rate is 0.5%. I was stupid that I spent so much time carefully choose the property but didn’t… Read more »
Jeremy Freelove
Jeremy Freelove
3 years 3 months ago
“If you say “Leverage,” and I point out that leverage works both ways, you need to have an answer for that before you drop several hundred thousand dollars.” Leverage doesn’t really work two ways in real estate, at least not the same as with other domains. When you leverage yourself in stocks (which is the same concept as real estate leverage only there are rules in place to make sure you can’t get anywhere near as leveraged as in real estate), your value can grow really fast but the flip side is you can lose your value really fast and… Read more »
Alden
Alden
3 years 3 months ago

An additionally compelling argument against buying (especially for 10 years or less) is the ridiculously low actual percentage of equity you build initially.

The majority of your early payments are interest. People “know” this but don’t realize how significantly this affects the “rent/buy” decision financially. It means even a 3% interest rate you are still throwing away 50% of the payments you make on the house for the first 10 years on average.

It’s gets much worse if you keep it for less than 10 and/or have a higher rate (over 70% for 5 years with 4.25%).

Optimal
Optimal
3 years 3 months ago
Bought condo less than 1yr right out of college year 2005 at 22yrs old in San Diego at the height of the refi boom. Was doing loans making 10Gs a month 6 months in a row that started to ramp up to 18Gs late 2005. Payment PITI (Principal Interest Taxes and Insurance) was $3500/month including condo fees. Total purchase price 350k only $22 down 100% financing. 3yrs later lost property in foreclosure. Too aggressive even with an increasing income in a market that was in a boom phase, new profession and buying the worst type of property at the height… Read more »
Optimal
Optimal
3 years 3 months ago
To add on previous comment I was renting a room for only $350 a month in San Diego (insane deal) in a house and nice neighborhood from Real Estate Agent that worked in same office as I. Everyday he would tell me “you are making so much money you need an interest deduction,” “I can start showing you houses,” and so on- this went on for months on end until I decided yes I needed to offset my income via the interest paid on a home loan. Did go over the scenario with my parents beforehand and they advised for… Read more »
Tyler F
Tyler F
3 years 3 months ago
Responding to Ramit’s reply: It is astounding how many people do not understand the US tax system. Deductions, credits, brackets… they are simple concepts when you take the time to learn, but many people just recite the incorrect phrases they hear other people say without ever understanding the reality. Also, the misinformation is so prevalent that even when you’re right, people will tell you you’re wrong. (case in point….) It’s one thing to not know when you’re young, but once you’re in your mid to late twenties, you should be wising up to this game. This is especially true when… Read more »
Todd Miller
Todd Miller
3 years 3 months ago
I actually haven’t been pressured to buy a house because I bought my first house 1 year out of college. Now, I wasn’t pressured, but my family did use the fact that I owned a house at 22 as showing how successful I was and how great I was with money. I managed to sell that just before the bottom fell out of the housing market and have re-invested in another home in another city. Now, after reading Ramit’s book and doing some additional reading on the side, I’ve come to the same conclusion that buying a house/condo really isn’t… Read more »
Evianne
Evianne
3 years 3 months ago
I absolutely agree that buying a single-family home to live in is not an ‘investment’ as people would have you believe. (For all the faults the book may have, that was one of the two things that stuck out to me reading ‘Rich Dad, Poor Dad’ years ago). However, that particular type of purchase does not necessarily equate with ‘real estate,’ and people need to stop thinking they are ‘investing in real estate’ when they buy a home. Actual real estate investing, which includes things like: identifying a growing market, examining rents in comparable properties, knowing your product type well… Read more »
Ali Davies
3 years 3 months ago
As someone who bought a house in Ireland during the boom and then sold it (in order to be free to move to Vancouver, Canada this year) when the country went bankrupt and had to be bailed out by the IMF losing a whopping 50% of the house value – you won’t be surprised to know that I am totally on board with your points here about buying houses. Interestingly, whilst being on the receiving end of that amount of loss was sickening at the time, in a strange way it sort of feels worth it now as cutting out… Read more »
Gretchen
Gretchen
3 years 3 months ago
Yah, I’m with you. All three of my siblings and most of my friends are owners. I listen to never-ending stories about their problems with their houses. The kitchens, the bathrooms, the landscaping, on and on. And that’s from the ones who didn’t get foreclosed on. But I’ve been hearing all my life what a good investment is a home, and how I missed the boat by not buying a place. All the reasons to avoid renting disappear if you have the right landlord. It’s not just luck, you have to interview your landlord and make sure they are someone… Read more »
Tanya
Tanya
3 years 3 months ago
I am in a similar situation to Gretchen. We have rented our house for 17 years. We did not have the means to buy in the mid nineties when places were cheap. For years I felt like I missed out, but now I am relieved. So many of my friends took out home equity loans after houses here tripled in price and now are saddled with huge debt and stress about finding money for repairs, etc. Right now, even though we plan to stay in this area, buying makes no financial sense whatsoever! We only pay $650 per month in… Read more »
Feels Stupid for Buying
Feels Stupid for Buying
3 years 3 months ago
Buying a house was the worst thing that ever happened to me. I bought in 2007 when markets were decent, and Have spent 3 years in the foreclosure process w Bank Of America. I originally purchased the house and note for $160k from Countrywide. In 2008 our note moved over to BofA. Getting divorced didnt help- I moved out in 2009 and my ex got the house but my name was still on the note. Since I made an actual salary and he was an investment advisor w no stable income they wouldnt remove my name from title or the… Read more »
Michael
Michael
3 years 3 months ago
A house that you own and live in is a liability. A house that you finance properly and positively cash flow is considered a successful investment. Like any other successful (business) investment, you should look at the cash flow. If you can’t make a business produce positive cash flow (and adequate cash on cash return for the amount of money that you put into the deal to begin with), then you’re just speculating. Successful investors buy and create positive cash flowing businesses. A home you live in certainly provides a roof over your head, but it’s not a positive cash… Read more »
Tom
Tom
3 years 3 months ago
I should also add that all y’all Americans complaining about you can’t bring a kid up in a 2 bathroom apartment with a huge amount of space should try doing the same in London ( really expensive with hardly any space or Hong Kong similar) so don’t whine as I know plenty people doing it. I think personally if I was to start all over I might buy real estate for investment, but rent myself as what is the point of burning all your dough on a mortgage and locking yourself into one place and be house, buy to rent… Read more »
Jen
Jen
3 years 3 months ago
Tom: This is true, but it depends a lot on the society itself. Family, friends, and fellow apartment-dwellers are a lot more likely to approve of raising kids in apartments if you actually live somewhere where everyone does it, like London or Hong Kong. In most of the US, relatives will act like you might as well just sign the kids up for welfare and get it over with, and other people in the apartment complex (unless they also have kids, and frankly in the US most apartment buildings full of families with kids are not in the best parts… Read more »
Terrance Cormier
Terrance Cormier
3 years 3 months ago
“Buying property as an investment is VERY different than buying a house, living in it, and and thinking it’s “the best” investment. Most people do the latter.” – and this is what the original question was. Purchasing real estate as a home may or may not be a good investment depending on the market, (both rental and purchase markets in ones local area) but it isn’t a path to wealth as it is still an expense and needs to be treated as such. At the minimum home ownership is like a forced savings plan that historically keeps up with inflation.… Read more »
Lee Harris
Lee Harris
3 years 3 months ago

Real estate may not result in a positive investment outcome for those that live in their dwelling. However, we all have to live somewhere. It is a quality of life question for me.

Nelson Muller
Nelson Muller
3 years 3 months ago
The very fact that reverse mortgages exist, and are so popular for the elderly, should serve as a good cautionary tale… don’t use your home as an investment vehicle! The returns just aren’t there! We are in the market for a house, currently renting, but for lifestyle reasons: we have four kids. Also I’m “behind” my peers who currently own. But I’m planning for a financial future that will allow me to invest money in other areas to lead a richer life in the future. Call it delay gratification. Our generation (I’m 30) needs to wake up to this issue… Read more »
Krys Freeman
3 years 3 months ago

does it count if it’s just rap, and not auto-tune?

JH
JH
3 years 3 months ago
I was considering buying a house with my wife back in 2009, but we decided to rent the house instead. The house was listed at $125K back in 2009 or we could rent it for $875/month. We decided to rent. We have excellent credit and offered to pay the 1 year lease up front in exchange for $100 less per month in rent. Since we’ve been there, a giant limb broke off the tree in the yard ($2000 removal), electrical problems ($1000), plumbing (at least $2000) and then the entire sewer had to be replaced ($14000!). Even if we bought… Read more »
Jarrod
Jarrod
3 years 3 months ago

“[W]e get those costs in an amortized form…”

It’s even better than that. Depending on how the owner amortizes the cost, you may not even have to bear the full impact of the repair. If the owner needs to make a big-ticket repair and can finance it for longer than you will live there, you will not pay for the whole thing. And like Ramit said, if the owner does a lot of renting (as an apartment complex does) there is a much bigger pool of tenants to share the burden.

Heather
Heather
3 years 3 months ago

“We have excellent credit and offered to pay the 1 year lease up front in exchange for $100 less per month in rent.”

Wow, that’s an excellent strategy!

Sarah Jones
Sarah Jones
3 years 3 months ago

“Can you show me the numbers? If you cannot do that, you are not ready to make the biggest purchase of your life, jackasses.”

I LOVE this, Ramit. Your no-bullshit-ness + “I hold you to a higher standard” = effective, inspiring, and fun.

And thanks for illuminating the buying a house issue. It’s about time 😉

Hilary
Hilary
3 years 3 months ago
the stupidest thing I ever did was to buy a house. I LOVE renting. Major repairs, insurance, taxes, all that crap is someone ELSE’s problem. All I have to do is pay the rent, and if my situation changes and I need to move, I won’t be saddled with a house I can’t sell. Why did I buy? Exactly the reasons you state…it’s what you are supposed to do after to get married and want to start a family. And the bs about rent being money down the drain. It was mostly my ex that really wanted to buy, and… Read more »
amy
amy
3 years 3 months ago
Wow- I can’t believe how timely your message is. Just today I had to break the difficult news to my dad (now ready to move into an assisted living facility) that his house is worth little more than what he paid for it 15 years ago… Less if you figure in the realtor’s commission on the sale. Dad was one of those people who believed his house was his ‘best investment’ and it obviously has turned out not to provide the nestegg he thought it would. On the up side, we’ve found that he can actually move from his single… Read more »
Emily
Emily
3 years 3 months ago
Our first house – we didn’t really feel pressure to buy – we just felt it was something we ‘should’ do. (we wanted a dog, had just gotten married, felt we needed more space etc). Looking back, that was a dumb decision. The house is worth 50% of what we paid in 2003 and because we didn’t make much, we couldn’t afford a ‘nice’ neighborhood, but settled for an ‘ok’ neighborhood. Well, surprise surprise, that ‘ok’ neighborhood has gone to crap along with the property values. We rent it now – but for much less than the mortgage. We’re just… Read more »
Jade
Jade
3 years 3 months ago

Ramit – Please add links below your videos to items/sites you recommend or discussed! I couldn’t make out the investing site you mentioned at the end.

Thanks so much!

Sonia M.
Sonia M.
3 years 3 months ago
It’s funny, I had a conversation about this with my 21 yo niece about 2 weeks ago. I’m 41, and have yet to own a house. Her bf is house-shopping (currently living rent-free with his mother so he couls save money for a house). She gave the usual arguments about throwing money away, and some new to me that sounded good but did not make much sense (she’s studying accounting). People are so emotionally attached to the idea of owning a house that the hole thing turns them in some kind of irrational mush. That’s the only way I can… Read more »
Anthony
Anthony
3 years 3 months ago
I looked into buying a house twice since college ( I’m class of 2007). Once in 2008 and once in 2011 or 2012. I’ve had a decent income, other expenses were low, and interest rates looked great, especially in comparison to 2004-2007 before the bust. I was actually got qualified and looked into prices and different options, because, you know, it doesn’t hurt to take that first step and just look right? Test the waters? I was very wary and I’m pretty cautious and yet I could feel myself getting caught up in this wave of enthusiasm. Even though it… Read more »
Ryan
Ryan
3 years 3 months ago
I just bought a house. For our family of 6, it didn’t make sense to rent anymore. For the equivalent house in our market, it would cost us 1200 a month minimum. I’m currently paying just over 1000 for the mortgage, insurance and taxes. If I add on maintenance I’m probably spending 10-15% more renting my house from the bank than I would from a landlord but at least I can do what I want with the place and don’t risk getting kicked out after the lease is up. I’m still firmly in the camp that believes a house is… Read more »
frank
frank
3 years 3 months ago

It used to be that you could OWN a house and land here in America. Now that it has been turned into Amerika, you cannot. You will NEVER own your property, and the government can take it from you at will, (Eminent Domain,) and if you do not have money to pay the forever property taxes you just became a renter.

Home ownership used to be a mark of freedom, now we are like the commies: rent from the “haves” and hope they are not killed have by the commie leaders.

James
3 years 3 months ago

I remember receiving all the classic, subtle pressures to buy a house a few years ago, not long after I got my first time job.

Said pressuring parents provided the down payment, too, not to mention some family issues that complicated it, but I really underestimated the opportunity costs.

A new job in, say, California or NYC a couple years ago would have quickly – backed by good spending habits – swamped that one-time new home owner tax credit, even at a whole $8000.

As it is, I plan to make the job move anyway and perhaps sell the house sooner than later.

Straight Up Talk Education
3 years 3 months ago
I love this article … when you really start drilling down into the WHY of what you are doing or about to do, that’s when things get interesting. I got over any interest I had in owning a home by housesitting for some wealthy people for a while. But they are wealthy only in that they own money-sucking homes that require incredible amounts of time, money and energy to maintain. And, when the real estate market goes down, they ARE trapped if they don’t have the cash flow to maintain that home, as well as some other place that they… Read more »
Akasha
Akasha
3 years 3 months ago

And finding good renters and having to manage real estate as rental properties creates its own set of time-consuming nightmares that I wouldn’t want to have to handle. Forget that noise! And I’m 40, so I’m supposed to want to “settle down” by “buying a house” and “setting down roots.”

Instead, I rent. I can move when I want and I don’t have to deal with all of the buying, selling, renting, repairing, etc, the homeowners have to manage all the time. I like the freedom.

JD Rush
JD Rush
3 years 3 months ago

Written from the viewpoint of a single guy in his early thirties. Have a few kids and you’ll want some security for them and not have to worry about a landlord’s plans for his property that may not include you.

Agota
Agota
3 years 3 months ago
The way people think about home ownership as an investment is extremely weird to me. I remember how I read “Rich Dad, Poor Dad” when I was 12, and even at that time I couldn’t understand how people can think of their house as an asset when it’s costing them money, not generating them money (renting is another thing of course). I think people would be better off if they would start being honest with themselves and stop calling everything they want to buy an investment. Why not simply admit that you want to buy a house because of the… Read more »
Joe
3 years 3 months ago

I agree. I’m 40 and have worked for myself the last 10 years. I never wanted to buy a house when all my friends did because I’ve had a great time living in various beautiful places and renting very well located apartments I couldn’t afford to buy. I’ve lived in Maui, Costa Rica, Caracas, Miami Beach, and traveled a lot. Banks don’t like freelance people that move a lot anyway, so I’ll keep living in cool warm places and happily renting while I invest my money in my own businesses, education, and lifestyle.

Tara
3 years 3 months ago
Thank you for this post! I am going to show it to my entire family, who have been pressuring me vociferously to buy property. It’s not positive persuasion, either: a few weeks ago I had this conversation with my aunt: “What you should do is BUY A HOUSE! You’ve been throwing your money away on rent for almost FOUR YEARS now.” Then she actually PULLED OUT A CALCULATOR and asked me what my monthly rent was. I told her (I don’t know why…familial deference perhaps?) and she belligerently thrust the calculator at me. “THAT is almost $37,000 dollars that you’ve… Read more »
Joe
Joe
3 years 3 months ago
I have owned ‘homes’ since 1971. I purchased my 1st home when I needed to rent a house, for my family of four, and realized that most of the 2 bedroom houses I was looking at were filthy and inadequate. I thought my wife was out of her mind (I wasn’t about to take out a 30 year loan on anything!) when she made an appointment with a Realtor to show us some homes for sale. The Realtor’s figures showed we would be buying the 2 bedroom home, with a guest house in back, for the same price as renting… Read more »
Jarrod
Jarrod
3 years 3 months ago
1,000,000 – 229,000 = $771,000 profit. Sounds good, right? The value has increased to 437% of your purchase price. But that’s over 26 years. Let’s check it with the compound interest formula: (we’ll assume a yearly compounding to check the annual yield) 1,000,000 = 229,000 * (1+r)^26, where r is the APY 4.3668 = (1+r)^26 log(4.3668) = 26 log (1+r) … r = 5.83% And this was a charitable set of assumptions: -I assumed no mortgage (and thus no interest costs – a 30-year fixed went for about 10% in 1987). -I assumed no property taxes -I assumed no repairs… Read more »
Derrick
Derrick
3 years 3 months ago
I feel like I made a mistake buying my townhouse back in 2005. I was just out of college and the DC real estate market was taking off. My mindset was instead of renting, I thought I could buy a property live in it for 4-5 years, make a profit, buy a bigger and better house and repeat over and over. Well 8 years later, I’m still in my townhouse and it’s worth 50% less in value. Thankfully my income has risen so that I’ve been able to pay the principal down. But if I rented an equivalent townhouse for… Read more »
Michael
3 years 3 months ago
Hey Ramit, Thanks for writing this up. You shed light on a topic that I frequently hear growing up in an asian family that STRONGLY believes buying real estate is the a way to grow your wealth. I find it interesting that when I ask my asian parents what are the downside of buying a property they don’t have any concrete rebuttals other than “I save money on my taxes every year!” WTF? How about giving me specific numbers on how much you saved? I love how well you handle haters giving you crap over this. I have a lot… Read more »
Robert
3 years 3 months ago

Mom recently pressured me to buy a house… “THE PRICES ARE NEVER GOING TO BE THIS LOW AGAIN”

Jin Curry
Jin Curry
3 years 3 months ago
I have from my mom, whom I still live with. She tells me all the time that I should just live here until I can afford to buy my own house so that I don’t throw away money on rent. I never really took it seriously. However, I did learn something interesting last week after researching house prices in the Conway/Myrtle Beach, SC area. Prices there have actually gone so low that I believe it’s cheaper to buy a trailer or low-end condo than to pay rent for a comparable apartment. It can cost about $7-800/mon incl. to rent a… Read more »
Roman
Roman
3 years 3 months ago

I have been working as a real estate buyers agent for a little under a year now, and feel real estate can be a great investment if you know what you are doing. That being said I am being pressured into buying my first house by my father (who I work for). His main point being that I need to support the product that I sell, and that it is the best time to buy. The problem is that being so new to the business I do not feel financially stable enough to buy.

LaughingMouse
3 years 3 months ago
I don’t even notice pressure to buy a house because I’ve been reading you long enough that I have my responses knee-jerk ready! So, first and foremost, thanks for that Ramit. Second, I was in a continuing ed class last week where the presenter asked who owned houses and why those people had bought houses. A 25 y/o kid behind me pipes up “You’re throwing away money on rent!” I couldn’t resist. I said, loud enough for the presenter to hear me, “If you want an argument against that, I have one.” He wrote down the kids answer and came… Read more »
Thierry
Thierry
3 years 3 months ago
Hi Ramit, Something I do not get: for argument sake, I want to retire in manhattan or sf, currently renting 1 bed for $3000 a month. In 30/40 years from now, the rent would end up being what? 6, 8, 10, 20k per month? Without owning anything I do not see any other solution but to buy. How many thousands of $ would I need to put aside and invest ON TOP of maxing out 401k/IRA to keep up with the future rent throughout retirement. I am under the impression you are saying that the money we are not putting… Read more »
Heidi
Heidi
3 years 3 months ago
As a married person with two kids, I have felt enormous pressure to buy a house. This pressure usually comes from friends who seem willing to risk everything to purchase property. They are even willing to move to a town they know nothing about just to get a good “value” even if that entails paying 15k a year + in taxes in addition to their mortgage and other expenses. One friend who bought in his 20s before many of us were ready to settle down and was an evangelist for buying, is now upside down in his property, and has… Read more »
Arshes76
Arshes76
3 years 3 months ago

Best to my knowledge, rents barely keep up with inflation and remember rents are usually tied to peoples incomes, unless incomes sky rocket i doubt your rent will also. Plus living in a paid off home isnt “free” by the time you have the home paid off and are in retirement, the cost of living will probably only be alittle bit less than renting. My parents are retired in a paid off home, and its definitely not FREE!

Steve Robertson
3 years 3 months ago

The monthly payment for my house is lower than my old monthly rent payment by a couple hundred dollars.

Matthew Bailey
3 years 3 months ago
Great points here. I bought my first $250K condo at age 22 with a 30K salary job. Barely made the payments but had this dream of investing. Dumb. Then 2007 hit. Yet, I bought a $500K house as well at age 23. Dumb. I managed to rent out the garage and basement and upper floor and turn a profit for a year. Then I broke even and sold it. I’m stuck with the condo but because its almost maintenance free, I keep it. It’s also in the best city in Canada, which is growing rapidly every year. I’ll use it… Read more »
Melanie
Melanie
3 years 3 months ago
As a military family, we’ve gotten subtle pressure pretty often from other service members. Before the real-estate meltdown several years ago, military families could build mini-empires of rental property, buying a house at each duty station and then either selling for a profit or renting it out, either with the intent of selling it later, moving back to it, or just keeping the tenants to cover their expenses. Some people were able to buy 6-8 houses over a twenty-year career, then either sell them profitably or earn sweet passive income from tenants. It was like we were idiots to skip… Read more »
Wendy
Wendy
3 years 3 months ago
As one who has had a financial and emotional interest in several homes over the years, I can advise that you should buy for pride of ownership and settle down and not just the investment potential. There are other things to invest your capital in that can get you better returns than real estate; being a landlord is not for the faint of heart, and you can have a very happy home by renting. It’s really all about living within or below your means so you aren’t a slave to the lifestyle you choose. Spending too much doesn’t make us… Read more »
Stacy McKenna
Stacy McKenna
3 years 3 months ago
Ultimately we bought because we’d had two landlords in 4 years say “you’re the best tenants I’ve ever had – I want the equity out of this property, you have to move”. I hate moving. Husband hates sharing walls, so houses were the only option that would lead to peace and tranquility. Solution? Buy our own. But the decision was made purely on the basis of “what is going to provide the best living environment for our brains?” and the tax benefits were a convenient perk. When the in-laws complained about the loss of their deduction when they paid off… Read more »
Moritz
Moritz
3 years 3 months ago

This obsession with house ownership has always struck me as really weird. Having grown up in Germany, I’m used to renting being the norm and owning being quite rare. No one I know, other than my grandparents, owns a house. It’s funny how attitudes about some things can be so different between countries.

Jenn
Jenn
3 years 3 months ago

I can see that some sites, including yours, think that video responses are the new way to come across to audiences. It would be great if you had a transcript available for those of us that can’t hear videos.

Roberto
3 years 3 months ago
Hi, I think this question is way to simplified. First of all, I’m sure the cost of renting vs ownership is quite different between countries and even cities. Living in Stockholm, Sweden, it is very hard to even get an apartment to rent if you have not had your parents put you in a renting-queue (with a monthly small payment) for 15 years. Some other things: There are many restrictions in what you can do with an apartment you rent compared to owning one. Where you can do a complete interior design renovation to your own liking and by improving… Read more »
Rickard
Rickard
3 years 3 months ago

Where I live it’s incredibly hard to find rental properties. I currently share a three bedroom apartment with two strangers, paying a pretty exorbitant rent. Do you have any specific advice for finding rental properties? (a lot of your advice in _other_ areas is of course useful, such as the straight-jacket technique)

Stacey
Stacey
3 years 3 months ago
Can anyone recommend a good book specifically focused on home buying and TCO? My finance and I plan to buy a house this fall and will have close to $250K cash available. We would love to pay cash but in our market we may end up having a loan – which we will be sure we can cover with just one income (the smaller one!). We have never owned a home before and want to know all we can about what the hidden risks may be. I’d love to read a more recent book that doesn’t have a “you’re throwing… Read more »
theDangerz
3 years 3 months ago
I find your uber-firm stance a bit disconcerting. In the comments above, when confronted you seem a bit less negative on the concept- but in the post you’re solely focused on telling everyone why investing in real estate is such a horrible idea. If your goal is to have your readers not buy and live in a single-family home, or not make bad decisions… then help by talking about how to buy investment properties soundly and wisely, which is absolutely possible (and easy in the current market). It is true that a home you live in is not investing, but… Read more »
Jarrod
Jarrod
3 years 3 months ago
I played the Cashflow game on Rich Dad for a while. Got really good at it, too. But look at all the hidden assumptions: -Real estate deals just fall into your lap. Except they don’t, you have to go searching for them. You’ll sift through a lot of garbage to find those sweet deals. -You know exactly what cashflow to expect up front. Nope, there’s a tremendous amount of uncertainty, and a small-time player can’t absorb a lot of volatility the way that a big investor can. A single month of vacancy could wipe you out when you’re as leveraged… Read more »
e
e
3 years 3 months ago
I live in NYC. I would want to buy something in the city. That way i dont have to worry about a rent increase, only maintenance increases. Future generations in my family can have a place to live in the city. Right now i try to look out for lotteries, and first time home buyer programs. There is a return to the cities happening all over the country. I would try to buy if i lived in Portland, LA, Seattle etc. Now i dont think its worth buying in some areas outside of a metropolitan area. For example everyone always… Read more »
Takeo
Takeo
3 years 3 months ago
My wife has said all the things you mentioned above regarding the normal expectations of buying a home from all her friends and was very determined to buy a home this year. Her parents even gave some money specifically to buy a home.. After looking at the total cost of ownership, and also looking at what is in our price range in the area, I convinced her we should keep renting and wait to buy a home when we have a higher income. I’d rather invest the money in various other ways anyways. I’m glad to see Ramit agrees w/… Read more »
Buying was no brainer - Colin
3 years 3 months ago
@TheDangerz – did you read the article? Ramit clearly encourages folk to “Do the maths then decide.” Anyway, for me, buying was a simple no-brainer, I couldn’t NOT buy. A government scheme allowed a discount purchase on my currenly occupied Socially Provided House (UK Council House, Right To Buy scheme). This offered me a 30% discount on its market value, so on day 1 I’d secured a 30% equity cushion – which has come in handy to soften the blow of the market crash (which, pisses me off reading some of the above comments – borrowing TEN TIMES your salary??… Read more »
theDangerz
3 years 3 months ago
indeed i did. and yes, his final conclusion is “do the math”, but all numbers and examples given are negatively spun. This website and post aren’t about how to take the easy road, its about becoming rich or being financially free. The fact that playing the market seems to be the only route to that goal is what frustrates me- it is simply incorrect. In my opinion they should both be part of your plan/portfolio. My wife and I are in our thirties. We left our jobs (after working our asses off to save every dime for several years) to… Read more »
Marion
Marion
3 years 3 months ago
Thank you for this article! Rarely do you hear about the hidden costs if ownership. The truth is that with renting there is no hidden costs, with owning there are MANY and they can be SCARY. Hello roof repair, hello foundation problems, hello plumbing. My father supported our family with real estate, and it’s a tough game, and he has to this date advised me against buying a home. He has always told me there is a HUGE difference between buying real estate as an investment and looking at total cost of ownership, market value, cash flow, return on investment,… Read more »
Vinish Saini
Vinish Saini
3 years 3 months ago

Thanks Ramit for your article! We are thinking to buy house because needs more space. We have 7 yr old and 1month old. Still struggling should we go for house or rent a big house? Any suggestions? (I haven’t read all 106 comments people left on this post so might someone already asked you this. ) thanks in advance.

Vinish Saini
Vinish Saini
3 years 3 months ago

Thanks Ramit!

I went through all the posts and it make sense to me. I have your book and reading. After watching you on CreativeLive, I am following your suggestions very diligently. I think we are going to wait for buying a house for few more years. Thanks again!

Johnny Mean
Johnny Mean
3 years 3 months ago
I struggled with this concept in my early years. Since, I held off from buying, I have been able to travel for months at a time, move where the market is best and really experiment with living in different neighborhoods. The money I saved from not servicing debt went into other investments and I haven’t met anyone with a mortgage that can take 6 month off to travel and my net worth continues to climb. In my current city (Vancouver, BC), the cost to rent is currently cheaper than buying, such as in NYC and SF. If I do purchase… Read more »
Olivia
Olivia
3 years 3 months ago
Thank you. This is exactly what my husband and I have been talking through. As a young married couple (early/mid 20s) with 2 small children we are the unusual ones among our friends to be renting, and we hear plenty of encouragement to buy now when the rates are so great. We have a 2 bedroom apartment with nearly all utilities included for $500. If I ever feel like we are throwing away money on rent, all I have to do is add up the property taxes, increased utility costs, maintenance costs, and mortgage interest to realize I would be… Read more »
Enrique
Enrique
3 years 3 months ago

Hi Ramit:
I have a friend who bought a townhouse 20 years ago. The mortgage will be paid in 5 years. He told me two things:1)Buy a property close to college campus. 2)and don’t rent to students. He has a monthly profit of $300.00 and it will be $700,00 a month within 5 years.

Kyle Walters
3 years 3 months ago
For Christ’s sake people! There is a huge difference between buying a house to live in and buying one as an investment. Buying to live in is NOT an investment. Let’s start with buying to live in. There is not really a financial benefit when you buy a house to live in. There are intangible benefits though, which include not having to deal with landlord BS – including pet policies, if on month to month lease possibly being kicked out in 30 days at any time, raising your kids in a stable environment, if in an apartment – not hearing… Read more »
Toya
Toya
3 years 3 months ago
Not even living in the US and the pressure to purchase is the same. My husband and I currently have NO savings and are trying to correct this while renting. My family however is trying to convince us to purchase land and build a home. Bare in mind that lawyer fees in my country is at least 7% of the cost of the purchase, and its a long and drawn out affair. The pressure is intense, it has caused many an argument between us as it is MY family that has been butting their nose in our business. With all… Read more »
Richard
Richard
3 years 3 months ago
A few years ago my wife said we had to buy a house to have kids. I didn’t really buy into that argument but instead of debating it I said “ok, show me how we can afford it after accounting for all the hidden costs”. We worked through everything and found a price level that made sense for us. I was ok with it because the cost was a little higher than renting but it wouldn’t increase as much in the future. The price we were targeting was low enough that we didn’t even find out what a bank would… Read more »
Mark
Mark
3 years 3 months ago
On Monday, my roof will be repaired and my only concern is that I may have to park farther from my apartment than usual. Not sure how much of this cost has been amortized into my rent, but if I were paying for the whole thing at once, I’d probably be looking for a second job. This morning, as I passed my complex’s maintenance truck, I was thinking of some friends of mine who will be spending a good chunk of this weekend doing yardwork. My mind went off on a tangent about division of labor from there and how… Read more »
Jim
3 years 3 months ago
I did exactly the opposite of what Ramit suggests and it worked out for me. I purchased a beautiful home for my young family of four with no possible way of affording it. I bought it with no money down and a mortgage set up where I only paid the interest and no principle. I could do this because my credit ratings was very high. I probably overpaid because of the market conditions at the time. I didn’t have a job, any savings, and no plan for high future earnings. I did all of this on purpose… and here’s why.… Read more »
Grant K
Grant K
3 years 3 months ago
Let me get this straight… your credit rating was so high, and regardless of the fact that you had no job, no savings, and no “plan” to increase your income, that the bank took a look at you and said “Give this man a house with nothing down!” You must be one hell of a salesman. And you did this to give your family the quality of life that you felt they deserved. “Screw it! I’ll just dive in headfirst to the expense that I’ll (hopefully) eventually be able to handle, because I want them to be happy NOW.” (I’d… Read more »
Stacey
Stacey
3 years 3 months ago

A more telling measurement is what a renter’s net worth is vs a homeowner’s 10-, 20-, 40- years down the road. Cash flow is important, but Net Worth is the ultimate scorekeeper. Plus when selling a personal home it is likely all of your capital gain (yes, at some point we’ll be back to gains…) will be tax-free, unless Congress f-s with that in the future. Selling stock at a gain…well, not so tax-friendly…

Jarrod
Jarrod
3 years 3 months ago

I am not a tax expert or a homeowner, but I believe your capital gains are only tax free if you use them to buy a new house. So it’s something, but not quite as good as you’re saying.

J.Hamilton
J.Hamilton
3 years 3 months ago

Not in Illinois. My mom’s friend sold her house and started renting. She received a letter from the IRS about 6 months later stating that she owed taxes on the money she gained from selling her house. Unless you buy another house within 6 to 12 months the IRS comes for their cut. She had 1 month to set something up to pay them off. Needless to say to moved to Florida.

Arshes76
Arshes76
3 years 3 months ago

That’s one of the downsides of the mortgage interest deduction. You get to get a tax deduction for the interest but then have to pay taxes on the capital gains. Here is Canada no tax deduction but no capital gain on the primary residence either.

J.Hamilton
J.Hamilton
3 years 3 months ago
What’s funny to me is that whenever the discussion of homeownership comes up no discusses the Condo or townhouse. They’re essentially renting and owning combined. That’s my story; actually my mom’s. In ’98 my mother and my grandmother combined resources to buy this condo. My mom stopped paying mortgage about 2 years ago after she filled bankruptcy. In addition to mortgage there are assessments. Now assessments is a monthly fee paid to a management company to take care of maintenance, landscaping, and certain combined bills such as gas, water, and security. They went from 190 a month to 515 a… Read more »
STEVEN J. FROMM, ATTORNEY, LL.M. (TAXATION)

Anyone who is seriously considering investing in real estate should get with a tax or real estate attorney BEFORE investing. I cannot tell you how many times I have met with new clients who have failed to set up these ventures correctly. And in PA and particularly Philadelphia correctly mistakes can be painfully expensive.

Joe
Joe
3 years 3 months ago
Stacey, thanks for your post. That is the bottom line. What will be your net worth down the line versus a homeowner’s. I started with $500.00 of closeing costs. That was my total out of pocket for my first ‘home’. About 3 or 4 years later we (wife & I) spent another $3,800.00 to purchase a 4-unit apartment bldg. We actually took over the existing loan on the property and signed a 2nd trust deed to the owner. That was our start. It was 40 years ago, but, all that time we have lived in our own ‘home’ and raised… Read more »
Mitch
Mitch
3 years 3 months ago

I think I’m going to wait until there’s another crisis, then I guess (ignorant assumption) apartments will be cheaper, I’m pretty sure there’s too much people barely paying their homes (over the 1/4 of the monthly salary recommendation).

Libby
3 years 3 months ago
Hi Ramit Interesting point. I think it would have been great if you had done the same research on the NZ property market for questioner. I live in Perth Australia, and after years of renting in really nice suburbs by the beach (a lifestyle choice) we are finally buying (also by the beach, but a little further away from the city) because it is literally cheaper to pay a $650,000 mortgage then rent anything half decent with a backyard with 10km of the ocean. In the suburb I currently live in, what was worth 250,000 15 years ago is now… Read more »
NS
NS
3 years 3 months ago
Ramit, Here’s a pressing question that combines renting vs. buying and love/ relationships: Since you say that “marry someone you love” is a script, do you recommend that a single person filters dating prospects for their financial worldviews, especially in regards to renting vs. buying, rather than try to change minds later on? Maybe casually bringing up the buying vs. renting debate on the third date before things get too serious? I read your book and blog and notice that you have tactics on bringing up finances with a current partner who may or may not be on board, but… Read more »
Eric S. Mueller
3 years 3 months ago
I bought into those scripts in the past. I also bought into that “Wow, housing values are really going up! I should cash out some equity.” Then the market dropped out from under me. I’ve been paying on an upside down house for 7 years, which I now have to short sale because my wife wants a divorce. I know a lot of military, and I hear those scripts all the time. “I’m tired of paying somebody else’s mortgage! I’m going to buy a house!” I then ask them “You could be on the other side of the world in… Read more »
Stacey
Stacey
3 years 3 months ago

http://www.bankrate.com/finance/money-guides/computing-capital-gains-on-home-sale-1.aspx

Please read this quick explanation of tax-free home sales to correct misinformation from previous posters (subsequent to my comment #121).

Jarrod
Jarrod
3 years 3 months ago

Thanks for that.

Bill
Bill
3 years 3 months ago

I agree with the logic laid out in the article, but it’s worth pointing out that owning a home can quickly make much more financial sense if you plan to rent out one or more rooms. I’m a 30 year old single male, and I offset my entire mortgage payment each month by renting out 3 of the 5 bedroom in my house to friends/acquaintances. Being a landlord and having roommates presents its own set of challenges, but from a financial standpoint it can make a lot of sense.

CC
CC
3 years 3 months ago
I didn’t notice anyone here talking about what a horrible nightmare owning a condo could be! My husband and I make fairly modest salaries but wanted to buy (at the urging of parents saying we could use our home as a deduction to spare us high taxes) and moved into an up-and-coming neighborhood for a good price. A couple of years later, our place was appraised at 3x more than we bought it for. We thought this would be our nest egg…but how wrong we were. The economic crash saw both of us losing our jobs due to corporate layoffs… Read more »
jim
jim
3 years 3 months ago

I built my own house last year. I saved a lot of money doing the work myself, but can’t imagine buying a home without any knowledge about simple home repairs. My advice: If you don’t know how to do simple repairs and upgrades. RENT. Ramit’s advice is spot on here.

Amanda
Amanda
3 years 3 months ago

That all makes perfect sense and I agree….the biggest surprise from that post was that there was someone other than me from New Zealand who knows who you are lol. I understand Naomi’s plight. In NZ its very hard to not own a home. If your in your 30’s and don’t have a house your looked down upon by a lot of people and they assume your someone who cant get your shit together or your not grown up enough.

Julie
Julie
3 years 3 months ago
While I 100% agree that buying a house is not the best investment, I also think that you underestimate the incentive side. Yes, people definitely are likely to lose money, and NO ONE I have talked to about my decision not to buy has ever seemed to figure out that with interest over a 25 year period they’re almost paying twice as much as they think they are. However, on the flip side, all of my friends who own houses are putting money towards that – stretching to make an investment. On the flip side, apart from myself, all of… Read more »
Chris
3 years 3 months ago
Home ownership isn’t right for everyone. It doesn’t make you more grown up. As a real estate agent I urge potential homeowners to never take more than a 15 year mortgage and save at least 20% of the purchase price for a down payment. It’s paid off much sooner this way and you save tens of thousands in interest. One thing I’ve always heard people say is “I’ll be able to retire when my mortgage is paid off” …15 years away sounds better than 30 years away when we’re talking about retirement. On a side note as a real estate… Read more »
Cat
3 years 3 months ago
I feel that way all the time 🙁 and I know it’s wrong! I hate renting and “throwing away money” – but I also know that if I was to buy, I would probably make the wrong purchase and be “stuck” forever. Granted you can sell houses but it takes time and effort,and I can’t imagine myself being ready to purchase something so big, holding me to the same spot in my life and the same job for years and years to come. I don’t ever want to have debt. I have student loans now, and that’s depressing by itself!… Read more »
Tara-Jay
3 years 3 months ago
I was looking into purchasing instead of ‘throwing away my money on rent. I did simple math on the total cost of my purchase, if I were to live in the same place for the term of the mortgage and make standard repayments Vs renting and putting the remaining money into my business. Return on investment on my business far outweighed the ‘stresses’ of being tied down to a mortgage. It also gave me the freedom to make ‘risky’ decisions as I didnt have to pay a large mortgage every month. Before I made any kind of money on the… Read more »
Elena
3 years 3 months ago
Ramit, I am a new reader here. Applause! I LOVED the article you linked to about real estate! I do not have to agree with everything to appreciate that it provokes me to thinking. My husband and I just spent 30 minutes discussing the REASON we would want to buy a house, while I am working on developing a new business now. You and the author of the article have GREAT and valid points. We agreed that our reasons to have a house would be: HAVE THINGS OUR WAY, and for sentimental reasons. We both agreed that we would not… Read more »
Naomi
Naomi
3 years 3 months ago

Hey – thanks for answering my question Ramit!

Update: in the time between my question and your answer, I did buy a property. However it’s a rental, and has been positively geared (incl. rates, insurance & mortgage) from day one. With potential to subdivide.

So perhaps a worthwhile investment…

As regards a house to live in, I’m a long way from that at the moment. So thanks for taking the pressure off me from diving into the white picket fence trap:)

– Naomi

Karen
Karen
3 years 3 months ago
Currently hubbie and I are doing well with our two houses. We could cover both mortgages on one average state salary, which is a possibility in our local job market. We are older than most of the IWTYTBR followers so won’t rehash the tradeoffs we made, which have been already been well stated by others above. What we struggle with is our parents and their irrational clinging to homes they cannot afford and sometimes cannot even maintain. The emotional attachments are strong and worth exploring early and often. I relish financial independence more than living in a house with a… Read more »
Thomas Redstone
Thomas Redstone
3 years 3 months ago
I understand Ramit’s point, and he’s right, you shouldn’t buy a house without good reason. But I don’t quite get how buying can be more expensive than renting, unless we’re comparing renting an apartment, to buying a house? All of the ‘other’ costs are still being paid when you rent, they’re just included in your rent. Fixing stuff is factored into the rent too, so unless the landlord has set their rent too low to cost in, you’re going to pay more than if you bought a house or apartment of the same value and pay your own bills. Things… Read more »
Thomas Redstone
Thomas Redstone
3 years 3 months ago

Sorry I missed your first comment Ramit, there are just so many of them, it’s easy to miss a relevant one!
Seems impossible, but it does make perfect sense, human behaviour often defies basic reason and maths, like the “Dollar Auction”, and countless other psychological experiments.
Even logically, once you’ve committed to buying a house to rent, making a small loss by taking less in rent than it costs, is better than making a huge loss by trying to make a profit and instead not having a tenant.

Ryan Hart
3 years 3 months ago

WOW – the 100+ comments above are like a Master Class in invisible scripts about real estate. The funny thing is that the commenters don’t even realize they’re doing it. Here are the three most common reasons I found why Ramit’s advice doesn’t apply to them:

-If you have kids you NEED more “space”
-If you’re a landlord you will always make a profit
-If you pay off your mortgage you can live for “free”

Did I miss any?

rackgen
rackgen
3 years 3 months ago
Indian here. The hints start first with an innocuous remark – “ABC has bought a house for Rs. X million” or “XYZ has finished construction of their house last week”. Slowly, it changes to “You are getting older now, the prices are increasing day by day” to “When are you buying property?”…… Buying a property in India is not for the weak. There are numerous scams to check, numerous people to pay a bribe and finally the sellers may not the be the sellers but a sub broker themselves. You will need to know archaic laws passed in 1800’s by… Read more »
Jordan
Jordan
3 years 3 months ago

Hello Ramit,

I am thinking about buying a house, my wife and i have about 3 months expenses saved and in our area, renting costs about 1.5 times a mortgage payment, so buying is looking like its actually a better deal. i have a stable job, and we want to stay in the area for at least 5 years, if not 15. what are your thoughts?
Regards,

Jordan

Michelle
Michelle
3 years 3 months ago
When I was younger I felt along with my husband that having started a family we “should” buy a house. Fortunately we truly couldn’t afford it. Looking back I am so grateful we didn’t buy something. I have a lot of real estate people in my family and they always give us a hard time about not owning a house. It has been especially bad since the interest rates have come so far down. They keep telling us we can “buy for less then we are renting” and “get a tax break too”. What we decided years ago (when we… Read more »
Mike
Mike
3 years 3 months ago
I am not sure how the TCO are added up for a house, but it’s not like if you are not paying the mortgage, you are saving that money. You still have to pay Rent, which if significantly is lower than your mortgage then you are truly saving. It’s not that hard to ask your mortgage broker to add your mortgage, insurance, taxes together and see if it is higher or lower than your Rent. Maybe the problem is the Home ownership is termed as Investment, when in reality it’s just not approached that way at all, neither is 401k… Read more »
Christine
Christine
3 years 3 months ago
When I got married, I wanted to buy a house since my parents had been chirping in my ears for 5 years, “oh rent, you’re just throwing money away, such a shame.” So my husband and I bought a house when we got married and we rushed through the whole process and everyone said how smart we were (Ramit, you would have been screaming at us to put on the fiscal breaks!). Seriously considering selling our house right now (very little equity in it) and renting, and investing the difference while we decide where we really do want to live… Read more »
Lee
Lee
3 years 3 months ago
I bought a co-op apartment in NYC when I was 26. This made sense, but mainly for my specific case. I knew I was planning on living in New York indefinitely, had already saved up more than the amount of money I’d be spending on the place (basically a necessity to pass a co-op board), and, at the time, the mortgage plus maintenance was cheaper than renting an equivalent apartment in a worse location. Over time, it continued out to be a better deal than renting, with the downside that I’ve stayed in the same place longer than I might… Read more »
nuke
nuke
3 years 3 months ago

Not a math whiz? That’s OK. This website has the best calculator to compare renting vs. owning in your particular situation. Simply plugin the numbers and voila, see for yourself:

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Akhil
Akhil
3 years 3 months ago

I keep reading that the cost for home repairs, taxes etc. are built into the rent, however remember the landlord isn’t setting the rent, the market is. You can ask for $3k a month but no one’s paying it if comparable homes are going for less.

Sky
Sky
3 years 3 months ago

Awesome website and awesome pointers! great detail and perspective!
Helps me a lot!

Stewart
Stewart
3 years 3 months ago
Ramit, this is good stuff, but I think you’re overstating some of the costs of home ownership in the video. For instance, no one’s paying 6.41% interest these days; a 15 year mortgage can be under 3%, and even a 30 year mortgage can be had at less than 4%. So that cuts the interest cost in half. The T&I number is a little high in my experience, but I’m from an area with relatively low property taxes. You also don’t spell out the difference between “maintenance” ($108k) and “repairs” ($300k). $408k over 30 years ($13.6k/year) is very high in… Read more »
Erin
Erin
3 years 3 months ago

Just like anything, it depends on your circumstances and timing.

Lori Stalter
3 years 3 months ago

I think the phrase I heard most often is, “you don’t build equity by renting.” We bought a house in 2006 just as prices peaked (oops). We paid extra on the mortgage every month to build up equity faster. Then the market tanked and we lost all of our so-called equity and then some, which I’ll probably have to wait 30 years to get back to break-even point. As soon as my kids graduate high school I’m dumping the place by whatever means necessary. I don’t think I’ll own ever again.

Susan
Susan
3 years 3 months ago
For a long time, I thought I was making money by renting a property I had in NYC (I lived in another city, renting) but wised up & got out ASAP. This is a cautionary tale on real estate investment: if you don’t have the money to pay a lawyer (for regular consults), reputable managing agency and full-time staff to provide repairs to said property you might risk losing your shirt. Loft in NYC rented to tenant who seemed nice, but unbeknownst to me, regularly threw wild parties with all sorts of substances -> at the party a person fell… Read more »
Nina
Nina
3 years 3 months ago
I bought into the myth that we all NEED to buy a home. I didnt buy what I was approved for but what I thought I could afford. It was horrible. i loved my house but owning a home is not just the money cost for taxes (that went up quite a bit more then my salary did in the economy), repairs (monthly on an older home), renovations (not magazine style things I didnt need but atual necessities) and and utilities that are higher in a home even though mine was relatively small then most apartments. But the time…in summer… Read more »
raghu
raghu
3 years 3 months ago
First off – great book, I got to the real estate section of the book while myself and my wife were returning from a long road trip. Being newlyweds we did feel a little ( not a whole lot) pressure to buy property. Occasionally in an off topic conversation at the workplace, a co-worker would remind me that buying property is a good thing to do considering its a good market right now. But I never took the comment seriously because going by the co-workers’ own experience, he wanted me to buy a house because it seemed to him as… Read more »
Ken
3 years 3 months ago

Always a debate whether to rent or buy properties. Great insights, Remit!

SamB
SamB
3 years 3 months ago
I guess the biggest invisible script for home buying was the one I always got from my mom: “Buy land. They don’t make more of it.” As a matter of fact, my husband “owning a home” was the only thing my mom liked about my husband when we started dating. That’s another big one: “owning a home.” The fact that we have so happily adopted what should be easily identified as marketing speech..Tissues are called Kleenex’s, cotton swabs are called Q-Tips, and houses are called homes. I’m always impressed when I see that kind of effectivesness in marketing. I think… Read more »
Jen
Jen
3 years 3 months ago
Just wanted to say, as an illustration of phantom costs and costs of ownership: I live in a condo that I paid cash for (so I have no monthly mortgage payment and paid no interest on the thing) in Austin, TX, and my monthly costs (property taxes, HOA fees and special assessments for property maintenance, repairs to my unit, etc.) come damn close (less than a couple hundred dollars) to what I could rent it out for, or rent a place for to live in myself. I’m happy with my place, but it’s not all fields of daisies and dollar… Read more »
Naina
3 years 2 months ago

Hi Ramit,
Really informative post there. I am surely gonna read your book now. I was planning to invest in real estate but now i am gonna re-think my decision. Thanks a lot.

xmasy
xmasy
1 year 2 months ago

Pressure from my wife to upgrade to a mini mcmansion.
She is tired of saving up and not using the money. I am so against it solely because of the property taxes in our state. 2% of the home. So im looking at 16 to 20K a year in property taxes alone. Sigh.
All our ‘friends’ have upgraded, she says.

Alex
1 year 1 month ago

Buy to let property in london is best investment and it is recurring income life long. But real estate investment is one time investment.

Joy
11 months 14 days ago

My husband and I are (literally) living in a glorified trap house (that’s really a studio apartment) with our 6-year-old while we go through bankruptcy. We only want a place where we can tell our kid, “Go outside and play.”

But while we’re going through bankruptcy, we’re going to stay in our glorified trap house. It sucks so bad, because we want another baby. But we’re broke. So I guess we’ll just look at other people’s kids, and be cool with our trap house for the next 7 years.

God that’s depressing!

danielvhenny
10 months 10 days ago

UK was the best place for investment.very informative article about investment.

Topsy Crets
Topsy Crets
10 months 1 day ago
Decent article. I bought my first home in 2007 with the intent of it being a rental. I still own it, but it’s not a good investment. I keep it because a few years ago i refi’d to a 15 year mortgage, so i’m light on cash flow, but heavy on equity growth. The truth is I keep it as a mean of forced savings. In 11 years i’ll own it, and then will decide to cash out in full or collect all the rent each month while still having about 13 years of depreciation to work with. If anything,… Read more »
Peter
Peter
9 months 21 days ago
Great article. I currently rent a warehouse for my small business and I was thinking of buying a warehouse. I have enough cash to buy it outright. I did the math today and decided I was way better of to keep renting and use the money I would have spent on a warehouse in the stock market. While stock market returns are no guaranteed, it does historically return 6% or so. Where as property on an inflation adjusted basis and square footage adjusted basis remains essentially flat for the last 100 years. It seems to me that the stock market… Read more »
Kyla
9 months 19 days ago
I dont know about the US .. but In the UK Its very much cheaper to have mortgage than to rent. Rents are very high for what you get and usually the quality is much lower standard for rental properties. Id go as far to say that once a property is let for a long while it becomes much less sellable. Because its like work horse thats been floged with no care and attention. A owned house you will tend to have had more care an attention and love..! Eg a Council built property will always be less valuble than… Read more »
Reena Esquieres
9 months 7 days ago

This is truly a great article because it opens up the mind of people to think differently. However, investing in real estate properties from free property listings that on the lowest rates can really be a profitable investment. Making real estate investments are truly multifaceted and failure to look into some details will really affect where you put your money in. http://prelist.org/

danielvhenny
9 months 4 days ago

It will be really helpful to the real estate investors .thanks for posting

daniel
8 months 12 days ago

Thanks for the post .really useful for investing.

Vant
Vant
8 months 11 days ago

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Vant
Vant
8 months 11 days ago

Real estates are local and it’s important to understand the market you are looking to live, work and play. When it comes to affordable home prices, thriving economy, abundant jobs and lots of history, culture and entertainment, Pittsburgh, Pennsylvania has most places beat. Learn why investing in Pittsburgh real estate is a smart investment.
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Oliva
8 months 11 days ago

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Michael
8 months 14 hours ago

A friend I knew bought a house 3 years ago because she wanted to time the housing market bottom. I think even if she knew about the true cost of ownership she would not have listened.

real estate investment
7 months 22 days ago

This is a fantastic article! Someone who is thinking of buying a home should definitely give this a read.

Patrick
Patrick
7 months 19 days ago
I’m so torn over this article, for many reasons. I DEFINITELY agree that homeownership isn’t for everyone. And while I own a home, the thought of liquidating and getting my huge down payment back to pump into a few startups is enticing. But your math is also a little misleading here & there too. From your video: A dollar thirty years ago would be worth $2.22 today from some quick research, so your $290k home would theoretically be would worth roughly $645k in 30 years, whereas at the end of 30 years of rent you own nothing. So the total… Read more »
Jake
Jake
7 months 19 days ago
I bought a house three years ago for financial reasons, but I ran spreadsheets like crazy and I was very conservative in my estimates. My mortgage on a 3 bedroom house costs about 20% less each month than I was paying in rent for a 1 bedroom apartment. My house is a lot more work than my apartment, but I was able to get a couple roommates that pay the mortgage for me. I’ve only been in the house for 3 years, but it has already been a stellar investment. “Can you show me the numbers? If you cannot do… Read more »
leeshin
7 months 17 days ago

very useful blog, thank you

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7 months 13 days ago

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Claudia
7 months 10 days ago
So glad you’re bringing up this topic up. I completely agree that there are too many people who believe they need to buy real estate because the “should.” I got into real estate to learn about it and did very well but because I was still listening to people tell me that I “should” always own real estate, I even doubted my own education in my success and failed at my second purchase. I didn’t follow my entrepreneurial instincts. Real estate is not a one size fits all type of investment and that is unfortunately still the mindset of a… Read more »
Testo Rip XR
7 months 6 days ago

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6 months 25 days ago

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Mark
6 months 18 days ago

I totally agree with the thought that owning a house is an expensive idea as lot of taxes are there to pay. Still there are many websites and dealers are available who can help in getting a property at a fair price. They can even help in settling all the details misconceptions that a person has while obtaining a property.

Alice
6 months 11 days ago

This is very informative article about investing in real estate. No doubt, Investing in Real estate is the best and profitable option, but it is important to take advice from an expert real estate advisor before investing in it. Thanks!!

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6 months 8 days ago

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daniel
6 months 5 days ago

investing becomes popular nowadays and its become worth investing in real estate.

Luz
6 months 1 day ago

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5 months 28 days ago

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Daniel
5 months 26 days ago

ya its really a great information about real estate

Cheri
Cheri
5 months 24 days ago
These are all great points and as others pointed out, every situation is different. In our area, renting is more expensive (monthly) than buying even after you roll everything into owning a home (home insurance, mortgage, taxes, utilities, everything). It’s actually at least $100-300 more a month. Yes maintenances will add up to more than say $1,200-$3,600 a year, but for our situation the benefits outweigh the costs. We have two pitbulls (many renters will not allow) and we love the peace and quite of the country. For our situation, all that comes with a house will make us happier,… Read more »
PropertyEveryone
PropertyEveryone
5 months 14 days ago

If you have 100 units, you can negotiate better deals on a lot of maintenance tasks. PropertyEveryone

Benny Carson
Benny Carson
5 months 14 days ago

And that is why I am still looking for apartments for rent and not the house, but it’s just my way of thinking too not everyone is like that.

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Gabe K
5 months 11 days ago

Hi Ramit, I live in BC Canada. The market here is crazy right now. Prices are going through the roof. I see people buying a house one day and selling it a week later for $50,000 more. We are all wondering when the bottom will drop out.

Carol
Carol
5 months 6 days ago

Great article,Thanks for the good word.Real estate is booming now a days, there are many online real estate apps coming up in the market

Anonymous
5 months 2 days ago

Good post however , I was wanting to know if you could write a litte more on this subject? I’d be very grateful if you could elaborate a little bit further. Appreciate it!

Anonymous
5 months 19 hours ago

It’s the best time to make some plans for the future and it is time to be happy. I’ve read this post and if I could I wish to suggest you few interesting things or advice. Maybe you can write next articles referring to this article. I want to read even more things about it!

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4 months 28 days ago

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4 months 18 days ago

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Angela Westgarth
4 months 5 days ago

Thanks for this helpful information I agree with all points you have given to us. I will follow all of them.- Bishop’s Stortford Estate Agent

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3 months 15 days ago

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Stephen White
3 months 12 days ago

Hello,

Great Post!!

To buy any rental apartment, it is good to hire e real estate investor. Before selecting any apartment house, one must figure out how much you will need to budget for your down payments, furniture, utilities, extra monthly costs and your monthly rent.

Thanks for sharing this valuable tips.

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Frank Mills Finance Ltd
3 months 11 days ago

INVEST WITH 100USD AND MAKE A PROFIT OF 5,000USD IN 5WORKING DAYS! pottercarlleroy33@gmail.com CALL US: +12164527677 FOR MORE INFORMATION.

Earl
2 months 29 days ago

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faheemdahacs
2 months 24 days ago

I’m want to sell my old house and buy new one with best quality .I’m worry about that last few month because I have many question in my mind. But after reading your article I’m clear about my question. Such a amazing article which is very informative

John Ahmed
John Ahmed
2 months 2 days ago

Do you need an urgent loan? if yes apply now via: russell.credit40@gmail.com

Ramesh Sheth
Ramesh Sheth
30 days 10 hours ago

You pay Rs. 53,000/- a month as rent instead of purchasing it by paying about Rs. 2,40,00,000/-, which could have earned (@ 9% per year) monthly Rs. 1,80,000/-. This is reality of realty in Mumbai, as prices are steady since two years and have a decreasing trend but not to crash say even 50%, with interests going down (to 6%) , when interests shall earn rs. 60,000/-. So, let foreigners invest in realty but not those in Indians, who earn nicely, as foreigners lose money in stock-markets or do not earn, as inflation causes loss for stock-holders.

Baanguru
Baanguru
26 days 1 hour ago

Anyone who wants to buy a property whether land, condo or house should make necessary research to make sure that your decision will be worth it. You cannot just buy property for the purpose of owning one.

Peter Ciriello
Peter Ciriello
21 days 9 hours ago

Hey, as a commercial broker and investor in Los Angeles, I totally hear what you’re saying. And to anyone with $38,000, unless you live in an area where you can buy an apartment building with that, I would say don’t do it. Save for an investment property before buying a house. If you buy an investment property though, all those reasons ring true – leverage, tax shelter, etc. I could get into it, but I hope it’s okay that I just post the link… for anyone if they want to read. http://www.losangelescre.com/why-buy-real-estate

Hindustan Property
Hindustan Property
18 days 17 hours ago

Very well written blog. I have got a lot of useful information through it. I hope you keep writing like this.

Michael Hunter
Michael Hunter
13 days 21 hours ago
How i got my Desired Loan Amount from a Reliable and Trust Loan Company (darrenwatsonhome@gmail.com) Hello everyone… I am Michael Hunter by name currently living in Texas, USA.. Am writing this letter because am really grateful for what Mr Darren Watson did for me and my family, when I thought there was no hope he came and make a way for me and my family by lending us loan, at a very low interest rate of 3%. I never thought that there are still God sent and genuine loan lenders on the internet but to my greatest surprise i got… Read more »
Nicole
Nicole
15 hours 45 minutes ago

Choose knowledgeable United Nations agency you’ll be able to provide you with trust for home roof has been stricken by a Natural Disaster .You should take application of Roof Repairroof on your home. Additional advantage of it is you just can have a do it by yourself simply.

Clau
Clau
18 days 13 hours ago

I can clearly see the extra costs involved. For example, I have thought about if my rent and mortgage were of equal amounts I would still have bills, maintenance, furniture to buy etc with a mortgage. But, at the end of the day, uf you have a property that you own because you’ve paid the mortgage off plus you have made some savings, surely you are in a better situation than having rented and made even double the savings, since you can sell your property and live off the money if you want, by going back to renting.

Mrs Anna
Mrs Anna
16 days 16 hours ago
Dear Applicant, This is a catholic Church Loan International. It a registered private money lender. We give out loans to assist people, firms who need to update their financial status all over the world, with very Minimal annual Interest Rates as Low as3% within 1-year to 30 years repayment duration period to any part of the world. We give out loans within the Minimum range of Five Thousand United State Dollars to One Million United State Dollars ($5,000 to $1,000,000 USD). Our loans are well insured for maximum security is our priority.Interested person should contact us via E-mail: Fill The… Read more »
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