patrick.net

Call it Crazy says

I wish I had a nickle for every time I've heard this arguement...

So, tell me, how many people do you know have lived in their homes for 30 years??

Exactly my point. You missed the sarcasm - most bulls put up this argument.

Bigsby says

You'll be able to live in your house rent free for a year or two?

Ok ok...you win!

I think RFHTC was assuming the quaint old notion that you actually have to make mortgage payments on time.

rowemoore says

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Does that 400% include inflation?

Over the long term, RE prices generally track inflation, unless something "big" happens locally (discovery of gold/oil/big company moves in/etc).

wthrfrk80 says

Bigsby says

You'll be able to live in your house rent free for a year or two?

Ok ok...you win!

I think RFHTC was assuming the quaint old notion that you actually have to make mortgage payments on time.

Err.....

Call it Crazy says

I wish I figured this out a LOONNNGGGG time ago.....

Haha. Unfortunately most wait so loooonnnggg to figure out,oh shit - we are screwed.

rowemoore says

wthrfrk80 says

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Yes. People living check to check handle conflict with violence. RentingForHalfTheCost ironically has stereotyped the working poor while defending them.

Not at all what I meant. You mouth off arrogantly about how you know what other people live like in front of them, and I don't care what class you are talking to. If they don't hit you, and I was walking down the street in wind of the conversation then I would. ;) Bigsby has never lived check-to-check and doesn't really know what it means to do as such. No family living check-to-check should buy a house. Period. The responsibility is too much. If you can manage to get yourself not living check-to-check and save enough for a down-payment, then go for it.

Bigsby's thinking is exactly why we are in such a mess. It is the middle class thinking they understand how everyone lives. They don't. You see it in the Hollywood movies, you see it on this forum, you see it in the tax system. Total ignorance all across the board. Good luck to all, even the ignorant. ;)

wthrfrk80 says

rowemoore says

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Does that 400% include inflation?

Over the long term, RE prices generally track inflation, unless something "big" happens locally (discovery of gold/oil/big company moves in/etc).

I didn't say Corning, I said San Francisco. But most RE in California has seen this kind of growth over the past few decades, even factoring in inflation and the recent crash.

Will it continue? Only in really, really special places. (i.e. ocean view and the super fortresses). Demographics and continued job erosion will keep home prices flat, IMO.

You are correct though. My wife's family sold their upstate New York home for a loss in 2005. They bought in 1975.

RentingForHalfTheCost says

CaptainShuddup says

Of course I'll be able to do so, with the tax ramifications of taking money out of a retirement account or 401k.

Don't buy, I'll buy in your stead.

Two wrongs don't make a right. i.e. take money out of your appreciating 401k to leverage the funds to buy a depreciating asset (house). Oh boy...

OOPS my bad, that should be "With OUT the tax ramifications" I was trying to illustrate that I do not have a 401K or a neo-traditional which would be the anti traditional retirement plan, i.e. one that actually accrued interest and appreciated YOY and never EVER went down in value.

rowemoore says

Bigsby says

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Past performance is not a guarantee of future performance. In this case it might actually be more of a guarantee of shit performance. ;)

RentingForHalfTheCost says

If they don't hit you, and I was walking down the street in wind of the conversation then I would. ;)

No you wouldn't. And I highly doubt you'd argue that a guy making 1 mil/yr would punch some guy making 20 mil/yr if the latter made an arrogant comment about the former's lifestyle.

RentingForHalfTheCost says

Bigsby's thinking is exactly why we are in such a mess. It is the middle class thinking they understand how everyone lives. They don't. You see it in the Hollywood movies, you see it on this forum, you see it in the tax system. Total ignorance all across the board. Good luck to all, even the ignorant. ;)

Do you mean the propping up of the "American Dream"? If so, I wouldn't blame that on the "middle class".

RentingForHalfTheCost says

Bigsby has never lived check-to-check and doesn't really know what it means to do as such. No family living check-to-check should buy a house. Period. The responsibility is too much.

You have no idea what I've experienced in my life. I am from a working class English family if you really want to know. Yourself?
And you also continue to twist what I actually said. Very convenient.

RentingForHalfTheCost says

rowemoore says

Bigsby says

BayArea says

Make 359 payments and miss that 360th payment and watch what happens to your house.

You'll be able to live in your house rent free for a year or two?

If that happened today in San Francisco, the owner would just sell the property for a 400% profit over the original (1982) sales price.

Past performance is not a guarantee of future performance. In this case it might actually be more of a guarantee of shit performance. ;)

Depending on the investment, you are probably right. But that wasn't what I was saying. The comment was that if you missed the last payment on a 30yr mortgage, you'd be screwed. I pointed out that in San Francisco, or Foster City for that matter, you'd come out fine. I'm sure you'd agree. After all the reason you can pay such low rent in FC, is because your landlord bought many, many years ago.

rowemoore says

wthrfrk80 says

Bigsby says

That post makes no sense.

I know what he is referring to. ;-)

Yes. People living check to check handle conflict with violence. RentingForHalfTheCost ironically has stereotyped the working poor while defending them.

Also, FYI it is not just the working poor living check-to-check in this country and especially the BA. Many high paid families are living check-to-check because of their beloved realtor/bank. I'm talking families making 6 figures. 25% of families with mortgages are underwater in the BA. You don't think many of them are squeezed? I know many that are, and any hiccup will cause them to be renters again. Yah, great time to join the chaos. Not for the weak of heart. Good luck to all the over-fertilized yards out there.

RentingForHalfTheCost says

specially the BA. Many high paid families are living check-to-check because of their beloved realtor/bank. I'm talking families making 6 figures. 25% of families with mortgages are underwater in the BA. You don't think many of them are squeezed? I know many that are, and any hiccup will cause them to be renters again. Yah, great time to join the chaos. Not for the weak of heart. Good luck to all the over-fertilized yards out there.

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

RentingForHalfTheCost says

Yah, great time to join the chaos. Not for the weak of heart. Good luck to all the over-fertilized yards out there.

You seem angry on other peoples behalf. Your situation, as I recall, is very sweet. Low rent, very nice pad. I don't understand the reason for the vehemence in your post. While buying now may not be the best investment (in your opinion) there is no way banks are going to let someone get in way over their heads like they did a few years ago. So the risk of the current RE market fucking up the economy is relatively weak.

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Absolutely...if it costs $600k for the the house.

It's all about the ratio of price to income.

BayArea says

Well yes, lol, but then watch what happens with your 29.917 years of payments (on top of your original DP) after that.

Presumably, one would be intelligent enough to put their home up for sale rather than let the bank take it after paying on it for 29.917 years.

Please don't telll me that they are underwater after 29.9 years of payments...

rowemoore says

No you wouldn't. And I highly doubt you'd argue that a guy making 1 mil/yr would punch some guy making 20 mil/yr if the latter made an arrogant comment about the former's lifestyle.

If I was scammed into buying a piece of the American dream only later to find out that all I was doing was paying down some realtors Mercedes and adding a fresh layer of white marine paint on some bankers oversized yacht I would be pissed already. Many are and they should be. Now someone who doesn't know me comes around and joins the mix. I tell them I am living check-to-check and they say I probably have a good cash savings. I say "huh? No". Then they say "What? that is silly". Yup, I would punch them, and it wouldn't matter what financial class either of us were from. Done deal!

wthrfrk80 says

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Absolutely...if it costs $600k for the the house.

It's all about the ratio of price to income.

Glad someone is paying attention here.

The "bank" owns people's houses until the mortgage is paid off? What if they buy their homes for cash from the beginning? Then none of those pesky banksters ever get to take a cut.

Now if you could just prepay a lifetime's worth of property taxes in advance, then you really would own your home.

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Shouldn't buy a 1+ million dollar home with 20% down when the 20% down is all their savings. Add a 30% crash and now you lost your savings (100%) and are living check-to-check. Awesome stuff!

the people living check to check who bought in 05/06 and put zero down and then took massive HELOC (never to be repaid) and then lived there rent free 3 years before getting foreclosed and then getting 2k cash for keys did pretty well.

sorry for run on sentence! ha.

In general, I agree with the assessment that it is not a good idea to buy for only a 5-7 year period if all you do is make minimum payments. This is not guaranteed to beat renting in normal circumstances. However, if you prepay the principal (which implies that you did not buy above your means) and kill the debt in about 10 years - then you have options: 1 - sell and rent, 2 - keep the pad and "collect the dividend" - difference between market rate rent and your property tax + hoa payment plus whatever writeoff you can generate off the property tax or 3 - use the completely paid off home - your equity to move up to new home and again borrow below your means. I think the person in this situation can fully assess their option and their option pool will clearly leave them in a better situation that either the renter or someone who only made minimum payment on mortgage.

Bigsby says

You'll just have to see how many years you spent renting and what the current house prices are in the BA when that time comes. It doesn't look that great for you as things stand.

What the hell are you talking about. Every year since 2007 I am in a better and better situation. Next year will be the same I'm sure. And the year after and after. I'll buy when I think that trend will stop. We are not even close yet from where I stand. Geesh.

RentingForHalfTheCost says

Yup, I would punch them, and it wouldn't matter what financial class either of us were from. Done deal!

And you would go to jail and/or be sued.

I guess I don't OWN my LIFE or my FREEDOM, since I have to pay all kinds of taxes to the government. If I don't they will lock me up. Try not paying income taxes and see what happens.

These threads are stupid, and a waste of time.

rowemoore says

RentingForHalfTheCost says

Yup, I would punch them, and it wouldn't matter what financial class either of us were from. Done deal!

And you would go to jail and/or be sued.

Then I would get the best deal possible. My rent paid for by the taxpayers. Do I own my cell? I can paint and put as many holes in the cement walls as I like. That qualifies for owning in many people's eyes.

woppa says

I guess I don't OWN my LIFE or my FREEDOM, since I have to pay all kinds of taxes to the government. If I don't they will lock me up. Try not paying income taxes and see what happens.

These threads are stupid, and a waste of time.

You don't own time either. ;)

RentingForHalfTheCost says

Bigsby says

Yes, I see. Families living cheque to cheque, who could be making 6 figure salaries as you state, clearly should not buy a home.

Shouldn't buy a 1+ million dollar home with 20% down when the 20% down is all their savings. Add a 30% crash and now you lost your savings (100%) and are living check-to-check. Awesome stuff!

You do realize that six figure salaries cover rather a wide range. As do house prices. But hey, just create a scenario that best supports your argument whilst simultaneously ignoring all the other more logical possibilities.

RentingForHalfTheCost says

Bigsby says

You'll just have to see how many years you spent renting and what the current house prices are in the BA when that time comes. It doesn't look that great for you as things stand.

What the hell are you talking about. Every year since 2007 I am in a better and better situation. Next year will be the same I'm sure. And the year after and after. I'll buy when I think that trend will stop. We are not even close yet from where I stand. Geesh.

What am I talking about? You make claims of expecting a further 50-70%+ drop in prices and the like. When exactly will you be willing or able to buy a property? What if house prices track at or just below the rate of inflation for the next 20 years? What if they lose value but nowhere near the extent that you predict or need? Will you keep waiting and waiting then? Your 5/10/15/20... years of further renting may not look like such a good financial decision then. Do you see my point now?

Call it Crazy says

You NEVER own your home, PERIOD... even if it is mortgage free!! Try not making real estate tax payments and see who comes knocking on your door. You will ALWAYS be RENTING your house.

Correct. We have a winner!

wthrfrk80 says

Call it Crazy says

You NEVER own your home, PERIOD... even if it is mortgage free!! Try not making real estate tax payments and see who comes knocking on your door. You will ALWAYS be RENTING your house.

Correct. We have a winner!

Try buying a house, paying off the mortgage, and then selling it. Are you seriously telling me you never owned it then?

woppa says

I guess I don't OWN my LIFE or my FREEDOM, since I have to pay all kinds of taxes to the government. If I don't they will lock me up. Try not paying income taxes and see what happens.

Exactly right. Thanks to the income tax, no one even owns the fruits of their own labor. We are no longer a free people.

woppa says

These threads are stupid, and a waste of time.

Or do they demonstrate just how much we've really lost?

Do you EFFING RETARDS realize that taxes go to many things like roads and bridges and schools and all kinds of other crap that may or may not benefit you directly? I mean what do you think these taxes go towards? Yeah, we pay property taxes, doesn't mean we don't own the home. If you have no mortgage, you own that home. I mean to say otherwise is just moronic. Taxes have their purpose, and it's not to claim ownership of your home. If you don't want to pay taxes, go live off the grid in the jungle somewhere, subsist on your own. Simple as that right?

woppa says

I mean what do you think these taxes go towards?

Ton of taxes goes to waste govt. spending and 6 figure pensions and free health care for lifetime for the govt. employees.

Bigsby says

Try buying a house, paying off the mortgage, and then selling it. Are you seriously telling me you never owned it then?

You have "some" ownership of it, I suppose. It's at best an asset that pays negative dividends and slowly rots in the rain. It's necessary for shelter.

The only reason (I can think of) to "buy" a house is to
A) rent it to someone else (i.e. get rental income)
B) rent it to yourself (i.e. avoid paying someone else rent)

Every other reason is emotional.

Sure, but that is an entirely different subject. Tons of local and state taxes also go towards roads so you can drive to work, schools so your kids can learn for free. Federal taxes go largely towards defense, and medicare/medicaid so your parents can have health insurance. You are really going to cry about paying taxes because that means you don't own you house? A ninth grader could debate that ridiculous statement into the ground.

wthrfrk80 says

Bigsby says

Try buying a house, paying off the mortgage, and then selling it. Are you seriously telling me you never owned it then?

You have "some" ownership of it, I suppose. It's at best an asset that pays negative dividends and slowly rots in the rain. It's necessary for shelter.

The only reason (I can think of) to "buy" a house is to

A) rent it to someone else (i.e. get rental income)

B) rent it to yourself (i.e. avoid paying someone else rent)

Every other reason is emotional.

I bought my house because I pay less for it than renting a one bedroom in a grimy apartment building, and I will pay a whole lot less in 15 years. I get a deduction on my taxes, (whether or not this is a good thing, I get it nonetheless) and I don't have to smell someones disgusting ciggarete smoke wofting in through my kitchen window from the next apartment over, or hear footsteps above me from the 300+ pound couple and there 35 pound 1 year old. Those reasons are not made up, that is actual fact. *I did have to invest some money into the house in renovations and down payment, but I am paying less than my rent was, and I have an extra bedroom and a WAY nicer kitchen.

woppa says

You are really going to cry about paying taxes because that means you don't own you house? A ninth grader could debate that ridiculous statement into the ground.

I'm not "crying" about anything. But I generally consider ownership as keeping something w/o paying continuously for the privilege.

Do whatever you want with your own money.