Comment on A conundrum

jubilationtcornpone@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

• Lemmyoutofhere@lemmy.ca ⁨2⁩ ⁨days⁩ ago

  Yup. Oops, you need a new roof and a water heater, that will be $34,000.

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  • HeyJoe@lemmy.world ⁨2⁩ ⁨days⁩ ago

    Hey, I just did these things! Water heater i was ripped off, which cost me $2600, and the roof i actually thought was a good deal at 17k. Not fun but the roof made me happy. The water heater actually destroyed my basement by leaking out…

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    • Blue_Morpho@lemmy.world ⁨2⁩ ⁨days⁩ ago

      I’m guilty of ignoring my water heaters. Had my backup start to leak and it cost $1500 to replace. So I immediately bought a new anode rod for my primary tank. Drained/flushed it and replaced the old rod which was completely gone. It was an easy task but you will need a cheap impact wrench, 1 1/16" socket and chain link anode rod to make it easy.

      It’s something you need to do every couple of years. But I never do it.

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    • MrVilliam@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

      And so now you’ve learned that you need to regularly flush the water heater and change out the anode rod every few years, right? I just bought my first house. Hot water wasn’t working right. Heating element was dead. Why? There was so much scale that the lower element was covered in it. Replaced the element, flushed as much out as I could reasonably remove, and then flushed again six months later while replacing the anode rod. This keeps the corrosion at bay.

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      • mushroommunk@lemmy.today ⁨2⁩ ⁨days⁩ ago

        With new water heaters yes, do your maintenance. Old water heater that came with the place and hasn’t been touched in years? Yeah, the advice is to actually not flush it because you don’t know what cracks that gunk might be blocking up and it will be more likely to fail on you sooner.

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    • Lemmyoutofhere@lemmy.ca ⁨2⁩ ⁨days⁩ ago

      As long as you didn’t get a rental water heater, you did not get fucked.

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      • HeyJoe@lemmy.world ⁨2⁩ ⁨days⁩ ago

        I have no idea what that is, but I dont think I wanna know. I did want tankless on demand, but the service guy convinced me it’s not worth it, and I regret my decision. Said I won’t save much because the power draw is much higher than a water heater, so even though the heater is always keeping it warm, the on demand still takes more. I think I may have needed additional wiring for the electric and believe that’s really the reason he swayed me away.

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    • Lemmyoutofhere@lemmy.ca ⁨2⁩ ⁨days⁩ ago

      Ooof.

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• arrow74@lemmy.zip ⁨2⁩ ⁨days⁩ ago

  I always find this to be such a poor argument.

  Yes unexpected maintenance can sometimes be a huge problem, especially in the first couple of years, but after that you can tap into home equity and repair say a roof. Everything else while expensive is still cheaper than renting. Using the OP’s example 1k vs 500, I can assure you you will never have consistent 500 repairs per month.

  As for the taxes my city nearly went ballistic when the city increase the rate by 5%. At the end of the year it costed me $200. Per month that’s about $16. I’ve never lived in any apartment anywhere where rent didn’t increase by at least $50 per month each year. Even if someone had a home twice as valuable that’s still a very small monthly cost.

  Additional once you get past the first 3ish years rent prices have greatly outpaced your mortgage and you will be saving a lot of money compared to of you were renting.

  I’d like to wrap up with a question. If owning a home was such a sink of resources why do people become landlords?

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  • Blue_Morpho@lemmy.world ⁨1⁩ ⁨day⁩ ago

    after that you can tap into home equity and repair say a roof.

    There’s no, “tapping into home equity.” There’s only extending the mortgage with more debt.

    20 years ago my sister did all sorts of home improvements that she said were free because she was “tapping into equity”. Now she’s nearing retirement and complains she still has giant mortgage payments.

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    • arrow74@lemmy.zip ⁨1⁩ ⁨day⁩ ago

      I never said it was free and I never said it wasn’t a debt. Like obviously it is a debt, anyone that reads “tapping into home equity” as meaning free money doesn’t understand basic finance.

      It doesn’t have to extend your mortgage. You can take it out as a second line of credit as an additional loan to pay back monthly. Obviously the ideal would be to have the savings to cover necessary home repairs, but if you don’t this is typically the cheapest way to get a loan to do necessary maintenance.

      Sounds like your sister used her equity to refinance her loan and recieved a payout for the difference. That’s going to restart your mortgage and is probably not the best way to go about accessing home equity.

      So yeah don’t take on reckless debt you can’t payback. You can responsibly use your home equity for maintenance if you need to though.

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      • Blue_Morpho@lemmy.world ⁨1⁩ ⁨day⁩ ago

        Second line of credit or mortgage, its still debt.

        Your suggestion translates to “Don’t worry about home repairs, just take on more debt to pay them.”

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  • KnightontheSun@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

    Speaking to the post, I feel like there is a tipping point between OP and your points and the post is showing that. If you can convince the bank to loan you the money somehow you then start to build more capital which can pull you out of being “poor”. There are many variables and wildly varying degrees of this scenario, but once you start your ownership experience, some people can work it quite hard and build enough capital to own multiple residences and rent them out. (Those already in possession of capital are out of scope of OPs post.)

    Rent is paying the landlord for everything every month. No repairs lately? Too bad, you’ll still pay for the possibility. The exchange is that you should never worry about repairs (or taxes) as the landlord handles everything. Once the landlord figures his margins are too tight, they raise the rent. Lots of variables here too and that makes blanket statements about which is better more difficult. I advocate home ownership, but I feel terrible for young people. Runaway greed by those that already had the capital has changed things. The young folks I know that are able to manage it all had help from relatives.

    The act of convincing the bank and owning a home is getting more and more difficult. Impossible in many places and improbable in others without Herculean efforts. OPs post expresses this perspective.

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    • arrow74@lemmy.zip ⁨2⁩ ⁨days⁩ ago

      I personally grew up quite impoverished and me and my wife did manage to get our home in medium COL area. We don’t have exceptionally high paying jobs nor did we have any help from our families. We just made a lot of effort to build our credit. We’re also not old at all under 30 to not dox myself too much.

      A lot of people simply have some wrong assumptions about the amount needed to get a loan. We put down 3%, sure we didn’t get the most competitive rate and our payment is higher, but it worked out to the cost of our then comparable rent. There’s quite a few federal programs that ensure the opportunity for a low downpayment mortgage for first time homeowners.

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      • KnightontheSun@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

        In a previous life I was a mortgage loan officer at a broker. I bent over backwards helping folks get into those programs whenever possible. I was impressed with how little was needed when everything slotted in place in some cases. Glad it worked for you too!

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• onslaught545@lemmy.zip ⁨2⁩ ⁨days⁩ ago

  I wouldn’t say you get nothing from paying property taxes.

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  • rc__buggy@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

    That’s true but when they double over 10 years and four schools in the area shut down due to “lack of enrollment”? Streets sure aren’t any better and my neighbor who works for the city has only had COL raises for the same past decade?

    c’mon… something is going on.

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    • FireRetardant@lemmy.world ⁨2⁩ ⁨days⁩ ago

      Whats going on is decades of mismanagement of property taxes and city zoning. People fight tooth and nail to keep their property taxes low, and eventually the city has to do a big increase because they failed to increase incrementally. The bigger issue is how poorly we zone and design most north american cities.

      The average car dependant suburb costs more to maintain than it generates in tax revenue. A denser area like mixed use neighbourhoods and “missing middle” housing fares far better and generates enough that it often ends up subsidizing the rest of the city, the same is usually true for denser downtowns. That trend is dying off as those denser areas demolish tax revenue generating businesses and homes to pave parking lots that don’t generate taxes to park cars from the suburbs that don’t generate enough taxes.

      You can’t afford a home because for decades suburbs were given a massive tax break while denser downtowns (guess where the poors have to rent and ultimately fund the property taxes) have to subsidize car dependant expensive to maintain subdivisions (which is usually for middle class or wealthier people, especially when built new). Add in some racial demographics and we’ve basically engineered every city to have secret tax cuts for anyone rich enough to get into the suburbs.

      The best part is, many cities are keeping the cycle going because the only way they are paying for maintaince of an old subdivision is by using the devleopment taxes and fees from a new subdivision. This is not sustainable and ultimately equates to kicking the can down the road to let a future generation figure it out (which is literally as simple as building cities densely again, as they had been built for 100s of years).

      This hasn’t even touched yet on the urban sprawl, energy ineffeciency, and secondary effects of car dependancy that have all spawned from “the american dream” of suburbia. We seriously need to reconsider how we zone, build, and get around our urban spaces.

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      • rc__buggy@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

        I agree with a lot of what you said but this is complete bullshit:

        while denser downtowns (guess where the poors have to rent and ultimately fund the property taxes)

        I have never been able to live in a “downtown” because I’m just a construction worker. So GTFO with “these poor inner city areas are funding the suburbs.” I’m in one of the nicer houses I’ve ever managed to live in and it’s primarily a shithole. You’re telling me that the people downtown are subsidizing my white-trash ass? No way.

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      • blarghly@lemmy.world ⁨2⁩ ⁨days⁩ ago

        Hello, fellow strong towns enthusiast!

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  • Comrade_Spood@slrpnk.net ⁨2⁩ ⁨days⁩ ago

    Depends where you live. Where I live we just get more funded cops to more expensively harass houseless people.

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• rc__buggy@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

  I tell my soon-to-leave-the-nest kids:

  Rent is the most you will pay every month. The mortgage is the least you will pay every month.

  I’m loving them being here as full grown adults and enjoy my time with them and with our particular house they are seeing that lesson play out in real time. Some big expenses and I am the DIY dude. I don’t fuck with (big) electric or gas though, that shit can really backfire.

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  • The_v@lemmy.world ⁨2⁩ ⁨days⁩ ago

    Rent vs mortgage - gotta put a caveat on that one.

    Renting = landlord gets all the money but has to maintain the property.

    Mortgage - bank gets all the money and you get a partial refund if you sell. You pay for the upkeep. A mortgage is not really an “investment”, you usually lose money on the deal if you live there. It’s cheap rent from the bank.

    It basic math to see which one is better long term. Usually the mortgage wins because of of the partial return. However if you can’t do the upkeep yourself, renting is often a better financial decision.

    There have been times when renting was the smarter financial decision. Like the housing bubble in 2003-2007. You could rent places for 1/2 what it would cost to buy them per month.

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    • rc__buggy@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

      I think people should listen to this user.

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  • prettybunnys@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

    The other side of that is that my mortgage, even with rising property taxes and my house appreciating wildly in value, tracks less than renting.

    If I could rent a place for the price of my mortgage with the cost rising at the level my mortgage does … I’d rent all day long

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    • rc__buggy@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

      Yeah, that’s the thing. The market went upside down. Maybe 1993? Before that renting made sense even from a financial perspective in many areas. But now when housing is double or treble inflation? Nope. Sink money into real property at your first opportunity.

      We have fucked up the entire “developed” world so much that if you start poor you stay poor and housing is a large part of that equation.

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      • prettybunnys@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

        In my lifetime interest rates on mortgages went from high teens to the 3.whatever I have.

        Home values skyrocketed and now the expectation seems to be this must continue.

        Honestly I’m happier to pass my house on to my kid than turn a profit on it.

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  • Bgugi@lemmy.world ⁨2⁩ ⁨days⁩ ago

    That decision is true today, but realistically your rent will grow much faster than your mortgage (plus escrow) payment, and your mortgage payment goes away.

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    • rc__buggy@sh.itjust.works ⁨2⁩ ⁨days⁩ ago

      As long as interest is lower than stock market return your mortgage should never go away

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      • Bgugi@lemmy.world ⁨2⁩ ⁨days⁩ ago

        Sure, but when you refi to invest, it’s not really “paying for somewhere to live” any more

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• UnderpantsWeevil@lemmy.world ⁨2⁩ ⁨days⁩ ago

  Then there’s all the expenses you didn’t know about before you bought the house.

  The cost of owning is significantly less than renting over the life of the unit. Repairs happen, but most of the time they aren’t time critical, so you can budget out the repairs over months.

  …BTW, the county just did a reassessment on your property and your property taxes have now doubled

  Idk where you live, but most states limit the rate at which an acessor can raise your housing price. In Texas, the cap is 10%. So your property taxes can rise, but the won’t double overnight.

  You can also contest the increase. Harris has been fairly receptive to a simple “my neighbor’s house sold for X so my house should be worth about X, not X+20%”

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  • FireRetardant@lemmy.world ⁨2⁩ ⁨days⁩ ago

    The cost of owning vs renting can be very different depending on where you live and work and the amenities you want access to. Renting somewhere centrally located with good access to high quality transit and other amenities would likely be cheaper than owning. Unless we can start normalizing owning apartments again. You could own for cheaper on the outskirts of downtown, but you’ll likely be sacraficing access to some amenities by doing so.

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    • UnderpantsWeevil@lemmy.world ⁨2⁩ ⁨days⁩ ago

      Renting somewhere centrally located with good access to high quality transit and other amenities would likely be cheaper than owning.

      I’d need to see an example. I’ve never heard of a place that was cheaper to rent than own after five years. The break point on rentals tend to be short term stays, and mostly because of the cost of real estate transactions themselves.

      For public housing it can be cheaper. But that’s never going to be a centrally located high-rise.

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• Clent@lemmy.dbzer0.com ⁨1⁩ ⁨day⁩ ago

  Also, the 500 is just the mortgage payment. It doesn’t include the insurance and property taxes and, at least in the USA, private-mortgage-insurance (pmi) if the down payment isn’t at least 20%.

  The monthly obligation can easily be more than that 1000. The savings is in locking the first half in at a set amount.

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