Rent or Buy a home?

i am looking forward to purchasing a home in three years.

Want to rent

i would love to do both

I have found this calculator helpful: https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

Owning can build wealth if you will be in one place for a long time. But there's the risk of losing money if you have to sell at an inopportune time or have bad luck with repairs. Also, transaction costs of selling are high. We have rented for a long time because we always felt we might have to pick up and move at any time to chase job opportunities– and that would be especially likely to happen during a down market.

I have found this calculator helpful: https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

Owning can build wealth if you will be in one place for a long time. But there's the risk of losing money if you have to sell at an inopportune time or have bad luck with repairs. Also, transaction costs of selling are high. We have rented for a long time because we always felt we might have to pick up and move at any time to chase job opportunities– and that would be especially likely to happen during a down market.

After reading comments I'm thankful for this one. Often times a lot of terms are thrown around such as building equity or it was cheaper than my rent to argue for buying a home. However, it should be calculated mathematically to see which is actually better for each person's situation and the above calculator is a very good start. Math is important instead of gut feeling because we often do not perceive reality correctly due to shortcuts our mind makes.

For example if you put $100 dollars in Stock A and it goes down 50% on Day 1 and then up 50% on Day 2. Have you broken even?

At least on the surface a lot of people I coach, say Yes. But when they all sit down and calculate it they find out that they haven't broken even at all.

Another example is the 3 door puzzle which goes like this:
You are a contestant in a game show, and the game show host tells you there is a prize behind one of the three doors you face. You have to guess which door to open.

But when you make your guess, instead of opening the door you picked, the game show host opens a different door…one that he knows has nothing behind it. So now you're down to two doors. And the game show host says, "I'll let you change your choice, if you want to."

And the question is, do you change your guess? Or keep your original choice?

The natural assumption is that it makes no difference, and so people tend to keep their original guess - reasoning being that we all know you should never "second guess" yourself. However, mathematically it is always a higher probability of winning to change ones choice. Now you can argue against this, but for the most part you should always go with the higher probability of winning because why would you choose to lose.

As a real estate agent, purchasing a home is the best investment you can make. If you have to rent to get started but when you can buy please do. It is something you can have to call your own.

Read the following article by Dave Ramsey on whether you should buy or rent… it may surprise you!

https://www.daveramsey.com/blog/buy-vs-rent-myths-busted

Currently saving for a down payment to buy. Rent is too expensive

Agreed. Would try to buy instead of rent if possible.

Buy

When you pay your rent, that money is an expense, a cost it is gone because it is spent. But when you pay your mortgage, you work toward full ownership.

It’s always a tough decision

The fact that you’re asking means you’re probably better off renting. You really have to have your finances in order before considering buying, especially during these times.

In order to determine if it is better to rent vs buy you need to know how much money you bring in and how much of your money goes back out. You need to weigh if you want to have repairs paid by someone else or if you want to pay for the repairs to be done. You have to look at your lifestyle as well because if you like to do a lot of traveling renting may be better than buying since someone else is doing the upkeep.

Do a comparison which factors in all of the costs of homeownership versus renting. While homeownership sounds attractive, it can be a lot more expensive than renting when you factor in expenses like insurance, taxes, maintenance. In addition, if the home you are thinking about is larger than what you are renting you will also need to think about higher utility costs.

Good thread a lot of advice here.

Renting.. I don’t want to live in the same place.

My husband and I are currently renting, but our plan is to budget enough to have at least a 20% down payment for when we are ready to buy. The 20% was decided so we can avoid the extra cost of PMI.

I want to buy a home soon so I can get out of the cycle of rent and build equity. My parents, who have been lifelong renters, were recently evicted from the home I grew up in in San Francisco, CA. The idea of being a home in CA is daunting! to me home ownership = security (even if its a false sense of it!).

I am considering moving out of state so I can buy sooner. I would love to hear other experiences around first time home ownership. How to choose a location for maxim return on investment? Right now the benefits of building equity outweighs the glitz & glam of living in the city! Thanks so much.

I would really like to buy a home but its so hard to get the right amount for a down payment when your credit score is poor.

Habitat for Humanity is an option if you qualify and are willing to help build your home.
https://www.habitat.org/housing-help/apply

traditionally owning is best but these days renting is becoming more and more fiscally smart!

Here's some creative, less expensive options for owning a home.

https://sparkrental.com/8-awesome-alternatives-to-traditional-housing-to-save-money-see-the-world/

Living at our family home. Dad had to move out to assisted living. considering options if Medicare takes home after dad died

Ok- in most states it goes like this. House has to be sold over 3 years prior in order not to be a problem. As far as I know if they do put a lien on the house, you can still live there. However you cant sell- when the house is sold, the lien has to be paid. So it might not be the problem you thought. On the water line and some repairs you will have to make do. I lived with no utilites for a few months - it can be done. You situation could be worse– you have a house in disrepair with a lien coming….. that is the glass 1/2 full. Be strategic- you can get thru this.

I thought the look-back period was 60 months in almost all states.

Securing a rent property is a great way of increase your earning potential without physical putting in work.