So why’s it so hard to afford a house if rent is the same price?

[OddBeMe]

[NaultD]

Interest rates: Pre-COVID-19, interest rates were historically low (I got 3.1%) in preparation for an economic disaster. Now, in the aftermath of COVID-19, interest rates have risen to 7%.

You can put that same money as a down payment into a high-yield savings account online. From there, you can make better money than you would save by borrowing the same money over 30 years.

The entire borrowing system is like a kidney repairing itself. It can fully function, but you can't push it to the limits anymore. It's now more expensive to borrow money, so it's not advisable to do so right now. Of course, people's lives don't stop while waiting for better interest rates, but it will be costly in the long run.

I don't know much about rent, but from what I understand, renters are the ones left holding the bill plus profit. Flexibility and less responsibility is worth it at times if you make the most of it.

[OddBeMe]

Yes but savings accounts and CD rates have also gone up.

Jesus fuck it’s not that hard.

[NaultD]

That's not a house. The American Dream is owning a house. That's junk mail you have to spread every month from the statements isn't a roof.

Your home should be a roof over your head that YOU own with pride. It is also your savings account. 7% interest is getting rob of the American Dream. Yes you can make better money anywhere else and wait but life dosen't stop.

You have to make moves with the opportunity you have right now before they pass by. Isn't that what luck is opportunity meets preparation. Not everyone is lucky. Life isn't fair but people should be able to make the best of it.

My place is a really small condo, and I called it my shitty savings account that I could sleep in. You can't feel at home at a bank.

[OddBeMe]

Yes but it’s not instant gratification. Which is the problem with all Americans. We have to earn over a few years a down payment for house. Interest rates to high? Save and triple your money.

Fucking losers.

[NaultD]

That is not what was promised being the American Dream. To be called the greatest country to ever exist should be consistent with some level of pride.

I get we aren't the greatest country to ever exist but that's no excuse in trying to be. To be honest I'd only respect the world If the American Dream was the lowest the world can offer.

[OddBeMe]

Promises…I don’t remember promises. Thats communist thinking. Pull up by your bootstraps? Individualism? No one gives you anything?

Media makes you think college is useless. Makes you work shit jobs. Makes you vote for tax cuts that also cuts government funding home buyers enticements. See a pattern?

[NaultD]

"The American Dream" wasn't promised? If not ultimately a goal worth fighting for.

We are ultimately a mixed economy.

Imagine a fire breaks out and mother and grandma gets trapped. Should the fire fighters save them like the red communist party they are?

Or should you pay the fire fighters premiums seeing trap relatives? $5000 for the grandma and $8000 for the mother ow she hadn't seen the new born? Bump it up to $9000

[NaultD]

All up front before before they burn to death. You know already fire fighters got a side gig with a crematorium off setting there cost maximize profits off of disasters. Late stage capitalism at it's finest.

[OddBeMe]

Promises for the opportunity. No ones given anything.

[NaultD]

Where is that opportunity? Was said promise of opportunity broken?

[OddBeMe]

Let’s see….60% of Americans don’t have college degrees. But they have the opportunity.

College degrees secures you almost a mill more in your lifetime.

[NaultD]

Yes it does that isn't the American Dream.

Ultimately what I'm getting at housing should be shitty savings account not for profit. Think water or electricity companies they need profit sure but the manufacturer limitations of housing development and the lack we have is creating this crisis.

People want a 1950 world where home a/c open half the country as disabled real estate and gas was 10 cents a gallon. We Don't live in that world anymore and need to do thing differently.

Have a soft surplus of new housing. That will turn 80 year old homes worthless. That was Ultimately someone's retirement plan. Housing shouldn't be retirement plans.

[OddBeMe]

Opinions. I’ve been arguing the last several years we are not a labor economy anymore. Brainpower is how you make money here.

[NaultD]

That brainpower is funding space travel over domestic stability. There was a level of trust the rich of the rich gave a single fuck of the average person.

That's not how it is anymore. They want space travel leaving all of us to die.

[OddBeMe]

I don’t know what that last reply has fuck all to do with this. I’d personally be ok for Elon and Bezos to leave the planet.

But America is a service economy now. You make money based on how lucrative a service you provide. The only dream promised is the opportunity to make money and get educated. I’ll admit there are definite problems with those promises, as in we need more education funding etc.

[Chazmatazz269]

A lot of younger people are cohabitating to save money. Living at home with their parents, college dormitories and apartments, Roomies. com.
Unless banks are going to start writing loans and letting a half dozen different people put their names on one title or deed, it’s not that far fetched to consider homeownership is just too much for some people. It’s really not worth it as far as i’m concerned. I’ve always rented and i likely always will. People who suggest the cost of ownership is lower than renting. I don’t believe that for a second. They’re not factoring in the costs of maintenance and repairs. If ownership is so cheap and easy, why is it pulling teeth to get owners to make timely repairs on rental units? Because it’s not. Because home ownership is a lot like marriage. Everyone tells you it’s the best thing ever so that you join the club. Only to commiserate with you upon joining. Misery really does love company.
Ell oh ell!

[purplepoppy]

Rent is often more expensive which makes it hard to save a deposit. I don't know what the situation is where you are but here homes that should be affordable to locally are snapped up by outsiders as second homes or to be used as holiday lets, effectively turning areas into ghost towns in the winter.

[GOLDFISH_smile]

Most rent-to-own deals are sketchy as fuck, you could pay years into it and then be 1 day late 1 time, and get kicked out and all that time may as well have been renting anyway. It's safer to just rent a house unless you can afford to fully buy it upfront.

[OddBeMe]

Rent to own? Thats not a mortgage. Thats usually cars…and yes sketchy af.

[GOLDFISH_smile]

Pretty sure you have to have a house before you can get a mortgage on a house tho..

[OddBeMe]

No…there’s first time home buyers. Actually quite a lot of perks for them.

[GOLDFISH_smile]

First time home buyers can get a mortgage on a home BEFORE they buy that home? U sure about that?

[OddBeMe]

Do you not know how home buying works? You get prequalified…then find a home…the bank does the appraisal and inspection to make sure it’s a good investment.

And yes first time home buyers have many perks like wrapping their down payment into their mortgage.

[GOLDFISH_smile]

So a first time home buyer could "buy a home" without spending ANY money at the time of the "transaction"? The bank just buys the house for them and they just move in and start paying off a mortgage month 1? I'll admit I'm not the one who did the research for buying our first home, but that sounds way too easy to me. If that was the case then people would be doing it. And they're not.

[legman528]

Like was already stated, most banks require a substantial down payment. Then there are property taxes, insurance, and paying for upkeep, i. e. lawn mower, tools, routine maintenance and repairs, etc. But if you plan to stay in an area for a while, you will have the equity in the house and you will get that back.

[OddBeMe]

Again…rent when I look it up: 1500. That’s my mortgage payment including all that crap.

[legman528]

Right, but if you move in and two months later, your water heater goes out, or your basement floods and you have major expenses, will you be prepared for that?

[OddBeMe]

Well that would be a pretty piss poor job of the inspector…and thus you’d have legal rights.

[legman528]

I've been living in the house I bought for 12 years and 2 weeks ago my basement flooded because my sump pump decided to quit during a storm. Insurance will only pay a certain amount. I'm on the hook for the rest. Four years ago, a storm blew a tree onto our house. Similar situation, insurance doesn't cover everything. And the supply issues we were having during those COVID times made the repairs take forever.

[OddBeMe]

Shrug…. i would just say renting is literally tossing money away.

[legman528]

In general, I agree, and I have a degree in financial planning. But there are some advantages of renting. Another of which is that you don't have to worry about the market if you have to sell.

[Anonymous]

I can't speak for everywhere, but in Washington the median home price is 602k, which is over 3k per month payment. The median rent in Washington is 2k. Medium income is 63k. After taxes that leaves about $4,300 workable income per month. In other words, either 1300 with mortgage, or 2300 with mortgage to cover everything else (phone bill, internet, car payment, insurances, food, gas/electric/waste, etc.)

So, yes numbers theoretically work to own a mortgage, but the market is still hot and many buyers have to forego inspections to compete with cash investors. Sellers also sell lemons of properties knowing they may need a roof replacement, deal with mold, septic issue, etc.

TL/DR - rent is not the same price as a mortgage (even after ignoring closing costs and potential damages that would need fixing within the first couple of years).

[HighValue]

To buy a house they normally need 20% down, plus closing costs. To rent, they only need first and last months rent, plus a security deposit. Also, people that are already renting are usually stuck in a rental contract and would have to hope one they want to buy happens to be available when their rental contract is expiring.

[Anonymous]

Down payment all the taxes and such as well as still finding the rent to living in the meantime

Herea rough place is about 250k so you need 10% as a deposit so there's 25k
Stamp duty is 6% so there's another 15k
The other moving costs at least 10k but if you want to fix the issues and refresh the place make it 50k

So you need 50k-90k in the bank before you start looking

[OddBeMe]

Actually not really. Good credit can get you prequalled, and having equity in 401k’s or life insurance can get you the down payment.

[Opinion Owner]

Only if you want to be in debt for the rest of your life, have no retirement and ruin that credit rating

[Snakeyes7]

The down payment is a massive thing to save up for.

I also think zoning laws that artificially reduce the supply and property taxes should be abolished so that the price will be reduced and that the owner can actually own their home and not have to pay off some mafia goons for them not to take it away.

[Agape93]

Usually you gotta put a down payment first to get a loan to buy it, the you gotta usually pay a realtor, a home inspector, a well and epic inspector and so on, and that's without haggling over price

[OddBeMe]

Not a lot to deal with when investing in your future…

[Agape93]

But it is a lot if you work minimum wage or have a lot of debt

[OddBeMe]

And that’s another thing I’ve been harshing over. Education.

[Agape93]

Yeap, shits expensive and no guarantee of even getting a decent life. Like my girl has a fucking masters in world history, what's she going to get? Probably museum work that won't pay a whole lot, especially in my state.

[OddBeMe]

You don’t have to just go for jobs in your degree.

My wife has a ba in history and is a director of ops.

[Agape93]

I know, but it just goes to show that spending nearly 80 grand and years of hard work may not even get you a job in the field you're educated in.

[OddBeMe]

Sure but having a degree means hundreds of thousands more earned than not having one. Stats.

[Agape93]

She just needs to get one somewhere

[OddBeMe]

Tell her to branch out from history. My wife was originally planning to work for the FBI who told her history was a good degree because of the analysis it teaches.

Doesn’t all have to be worthless…

[Agape93]

Will do, she may have to move though for high paying stuff, like a few hours to the city. Shit nearby pays less than what I make unless she wants to work a trawler lol

[OddBeMe]

Is that gonna be a problem for you? Being flexible in relocating could be very benefitial.

[Agape93]

I'm not moving unless its to a new country. she's welcome to, though

[OddBeMe]

Woah. Love lost?

[Agape93]

Nope, I just own my property and put in too much work to just leave it for someone else's job prospects

[Agape93]

So if she wants to move south for work, she can and can always come up and visit

[OddBeMe]

There you go. Tell her ass to get a better job.

[Agape93]

Lol.

[In_Trance]

Rent is definitely not the same price here it's much higher than a mortgage payment

[OddBeMe]

Even makes my point more.

[In_Trance]

Trouble is, people can't save the down payment. But our mortgage rules are strict

[OddBeMe]

Well…they are and they aren’t. Home owners have infinitely more rights than renters. And sure a down payment is touch to save up for…. but there are ways to get it. I got a loan from my 401k. Maybe people need to think ahead and understand that college degrees get you 401ks.

[In_Trance]

Again, rules are different here; it's not that easy

[jshm2]

It isn't.

Dumb fuckers don't understand you have to be nice to people for them to let you borrow their money. Too many fuckwits want to act like shit, then complain when treated like shit.

[JacobJordan]

Rent is far more expensive than a mortgage and thanks to democrats the younger generations are fucked 7 ways from Sunday. Most of America makes less than a livable wage

[exitseven]

coming up with the down payment is hard. Most young people do not want to sacrifice to attain a long term goal. They are hoping the government will buy the house for them.

[avery58]

I guess the renter would not be able to afford the down payment or get a loan

[OddBeMe]

And I get that…but there’s ways around that. To work for it. Again your paying an apartment complex the same price each month.

[Redstang88]

Saving a down payment

[OddBeMe]

True. But that’s what saving means. Over time. Why can’t they do it?

[Redstang88]

Because with rent and other expenses going through the roof lots of people don’t have any money left over. At least not enough to put a dent in a million house, which has pretty much become the standard entry point

[RedInnocent69]

Um, down-payments, credit ratings, and interest rates, maybe?

[NathanDavis]

that's why I rent to myself...

[OddBeMe]

That’s interesting. Now eye-r-s issues? Lol

[NathanDavis]

shhhhhhhhhhhhhh

[OddBeMe]

I might try that and put you Nathan Davis as my legal adviser.

[NathanDavis]

https://www.youtube.com/watch?v=yu5Tpuv2m2M

[OddBeMe]

Just imagining how much blood loss from cat scratches after this shoot. Lol

[Juxtapose]

Rent and a mortgage is NOT the same.

[Juxtapose]

Insurance, maintenance, HOA, property taxes, etc.

[Juxtapose]

Not to mention you have to replace appliances.

[OddBeMe]

What’s average rent now?

[Juxtapose]

That really depends on your state.

[OddBeMe]

Wow. Just googled “national average rent”. What do you think it is? It’s actual exactly equivalent to my mortgage.

[Juxtapose]

.. you're googling an average for a land mass that is literally bigger than Europe when something like California and Ohio can have two completely different rates?

That's stupid.

[OddBeMe]

Not to rent America stupid. National average of renting prices.

Please save yourself and tell me that was a very bad joke.

[Juxtapose]

Are you serious? I'll talk you out the national versus State average dude don't be silly.

[mickeysmonkey]

Getting the loan

[OddBeMe]

True. But there’s ways to work toward it. Especially first time home buyers.

[GoodgirlNatalie]

High cost of living

[OddBeMe]

What’s rent tho? Same as a mortgage?