/biz/ - Business & Finance

[Anonymous No.24797378]

>Housing prices: +8%
>APR: -3%
>Repairs: -1%
>taxes: -1%

>TOTAL: +3% a year

Am I missing something or do these returns seem pretty shit? And this is on the high end of housing price inflation. Someone debunk this for me.

[Anonymous No.24797462]

Wouldn't it be better to just rent where you live and invest the money saved into any other investment vehicle and if you want to buy, buy somewhere you can rent out?

[Anonymous No.24797551]

SOMEONE PLEASE ANSWER

[Anonymous No.24797603]

I bought a house in a major city in Texas at the height of the pandemic fear in June, today similar houses are for sale in my neighborhood for almost $90k more. This has unironically been the best and fastest growing investment I have ever made. If you don’t buy in the right spot, or you don’t own the land, real estate can be a shit investment for sure.

[Anonymous No.24797872]

>>24797378
The alternative is renting where you lose 100 percent a year

[Anonymous No.24797919]

>>24797378
so many wrong numbers....

you think housing appreciates at 8% per year? only the top top top RE gets those types of returns. Average slobhomes are flat returns...maybe 1.5%

[Anonymous No.24797924]

>>24797551
yep they're shit, most landlords think they're hot shit but can't do the calculations properly
there's still some greedy kikes squeezing pennies here and there that can do better

[Anonymous No.24797976]

>>24797378
Yes it is shit especially because your gainz are on paper only while your expenses are real so in fact you are cashflow negative and need pretty big pockets over the next 20 years until you sell

[Anonymous No.24797985]

>>24797378
buy in a white area its at least 20% a year

[Anonymous No.24798033]

>>24797985
It’s a better investment if you buy in an area that’s TURNING white. Gentrification is the best RE play

[Anonymous No.24798060]

>>24797919
So the average person would be better off just renting a house versus buying it?

[Anonymous No.24798089]

>>24798060
if you're going to just let it sit there unoccupied, yeah
if you're going to live in it or rent it out, no.

[Anonymous No.24798094]

>>24798033
>tutortial on how to gentrify?

[Anonymous No.24798272]

>>24798094
>Large City
>Tax free state
>lots of cranes in the skyline
>look for the jogger infested ghettos that are closest to downtown
>look for whitest possible street in black neighborhood
>buy house with nicest LOT (most jogger houses are teardowns in medium term, the money is in the land).
>profit

[Anonymous No.24798468]

>>24798060
>so just rent?
compare and contrast:

* Rent: $900/month x 12 months x 10 years = $108,000 spent in total

* Buy: $250K loan @ 2.85% over 10 years = $63K spent in interest + $35k taxes = $100,000 spent in total

So mostly a push.

HOWEVER renting will give you jogger neighbors, so depends how much that is worth to you.

[Anonymous No.24799305]

>>24797378

The only reason to buy a house, is it's the only asset type the bank will loan you 300k to invest in. It has a worse risk/return than stocks, but they do this because government deems it critical to keep the housing bubble pumped with cheap retail debt, in order to keep the boomers happy.

They can do it until the dollar dies, or until they decide to rug pull the housing market by raising interest rates.

[Anonymous No.24799377]

>>24797378
Purchasing houses you can rent out for greater than the mortgage is a good investment. For your own place, you have to run the numbers on renting vs. Buying in the area you want to live in. Every area and property type is different, anybody trying to give a catch all answer here is a brainlet.

The idea that rent is throwing money away is a misconception, because you need to consider the opportunity cost of your down payment and closing costs. And when maintenance is factored in, the total monthly cost on renting a place is often cheaper than buying something comparable with a mortgage, especially in retarded bubble markets like SF. But one advantage of a mortgage on your own place is that the interest is a tax write off

[Anonymous No.24799419]

>>24799305
What would happen is the US government rug pulled the housing market.

[Anonymous No.24799625]

>>24799377
>one advantage of a mortgage on your own place is that the interest is a tax write off
checked and there other legal advantages.
in many states (ie. FL) primary home is not a sizable asset in the case of a legal judgement, whereas bank / investment accounts are

[Anonymous No.24799632]

>>24797462
Maybe, but renting may cost a lot more than owning depending on the local market. For example in my area (midwestern suburb of a city/non nigger area) my monthly payment for a 1200sqft house is $865, but the prior owner of my property had been renting it out for $1200.

[Anonymous No.24799675]

>>24797378
You get to own a house and earn equity on any positive sale while still paying off the mortgage, seems obvious to me vs. renting which is a black pit of your money that has no future

[Anonymous No.24799705]

>>24797378
You didn't add in the price of having somewhere to live. You've basically just calculated the return as if you're buying the house and then letting it sit empty. You should instead add in the price of renting a similar house, since you could be doing that with the property (or living in it, and receiving the same value in kind).

[Anonymous No.24800285]

It depends on the area. But, bear in mind, you can use a house for leverage, much like you can use margin for stocks. I don't know much about real estate though, so I don't spend much time looking into it. I prefer equity.

[Anonymous No.24801682]

>>24797378

Location, location, location

You don't buy a home for appreciation on the home per se, but instead the land it is on.

The appreciation in price is anything that has increased the perceived value of the land, besides that people want to "own" their land or move away from congested, overpriced urban areas.

These prices are largely going up as people get access to cheap debt.

I think the game plan by the bankers is to inflate the prices of everything and keep you on an endless payment plan. Who gives a fuck if interest rates are 3% when the principal is largely inflated.

[Anonymous No.24801699]

>>24801682
I don't want to live in a suburb near a major city though :(

[Anonymous No.24801705]

>>24798094
>>24798272

Look for target/starbucks/ulta beauty expansions too.

[Anonymous No.24801733]

>>24801699

Hey, go to the great plains and buy acres of land before all the rich foreigners, celebs, and 1% of the 1%ers do.

You did save for your retirement, right anon?

[Anonymous No.24801894]

You have to live somewhere so you have to compare it to renting. Renting would be losing more money as long as your house’s value rises steadily with the market. Also your APR loss is not on the total value of the house it’s on the mortgage. If you had a large deposit this would lessen the interest paid. If you had a small deposit it would be more expensive, but then again you would have less money to invest in other areas, so you wouldn’t make as much as the house appreciation anyway.

If you had a deposit of 100k, renting a house could cost 1~3k a month depending on location. You’d need to make 12~36% per year on your other investments just to break even.

[Anonymous No.24801972]

>>24797378
Leverage and rent brah.

[Anonymous No.24802105]

>>24797872
Virgin rentcuck vs chad living in paid off car

[Anonymous No.24802141]

>>24797378
>>24797872
It's much, much worse than that. Unless you live in the house 10+ years, you're leaving out the realtor fees (6%+ of the entire selling price), the closing fees/gimmes, and the cost of rehabbing when you move out (will need carpet, flooring, paint, probably bathroom/kitchen remodels).

Add in the fact that nearly 100% of your payment is interest your first few years, almost no principle gets paid, and you're losing money hand over fist.

Real estate as an investment for many people is a huge meme.

[Anonymous No.24802165]

>>24799419
Normal times? 2008 crash. Right now? Total economic failure, societal implosion, and total war.

[Anonymous No.24802258]

>>24802141

Don't tell them that!