Doesn’t this mean that rent is too damn high?
In my country an average house that sells for 200k would be rented for 800 euro. It’s 20 years, seems reasonable. Add taxes and the burden to pay all the maintenance and it becomes 25-30 years
Otherwise people would buy houses as an investment compared to a necessity
Repeat after me: it’s okay to rent. Equity is not everything.
The downvotes are really depressing. My point is that we’ve been conditioned in America to focus solely on homeownership. The banks, title companies, realtors, and home contractors tout it as the American dream. No matter the personal cost–the down payment, the interest, the insurance, the maintenance–and no matter what negative externalities–sprawl, inefficient heating and cooling, increased infrastructure, car pollution, divorce and obesity from commuting–you must buy a house.
I get it. If your overriding concern in life is to maximize investment, then by all means pour your cash into a house.
I dont want to own because of equity, there is a lot of other reasons why owning is important for me. For example there is a lot of things I would like to do in my apt that I cannot as a renter: passing cables in the walls, moving a wall, adding some electric plugs etc. I also have less stability, even if I have some protections tbe owner could always decide to do some big renovations and kick me out.
Renting is okay, but there is big drawbacks and I should be able to own if I want to.
And aside from that, house prices going up also means rent going up. Rent going up means more people in the streets. It’s just bad for everyone who is not already an owner
Renting and ownership can be fairly similar in larger cities (but costs more than owning a house in my state), but when you’re in the rural America, there tends to be a fairly sharp decrease in quality of life despite the fact that rental prices adjust up with housing prices anyway.
I mean, I can still get a half-acre of land and private house for a mortgage payment that’s about the same as the rent on a 2 bedroom apartment. Without having to worry about a landlord, an upstairs neighbor with toddlers. I can do what I want with my yard, even have any pet without an additional “pet fee”.
And rental houses (the happy medium?) in my area are going for exactly what the mortgage would be to buy one today. We’re talking $3000, even $4000/mo. Yeah, current rates are shitty, but that still gets you a $550,000 mortgage (used to get you closer to $700,000). And rent isn’t going down any time soon, but one can likely refinance to a lower rate in 5-10 years
What it means to me is that I’m not selling my house, with my 3% APR mortgage any time soon despite the $200,000 in equity I have from the price skyrocket.
Okay? I mean we live in two entirely separate worlds. $550k in my area gets you 850 sq ft with added condo fees. And of course if you’re locked in (trapped?) at 3% you’re not going anywhere. You can’t go anywhere even if you wanted. If that’s worth the advantage of doing your own landscape maintenance on the weekend, and having to drive everywhere for the simplest of errands, then head on.
