Owning vs Renting?

[brewer12345]

I have owned for the past 6 years, mostly due to lifestyle cosiderations (i.e. dogs, cat, kid, not wanting to be forced to move, not wanting to deal with landlord BS, etc.). The first place we sold after 4 years at an obscene gain (bought for 93k, put not more than 5k into it, sold it for 220k). Naturally, two years later I saw a similar place that we sold for 220k being listed for 300k! We are now in a house that I expect to be in for the forseeable future (i.e. at least until we hit FIRE). We like the area, have mostly pleasant neighbors, and it is unlikely that the neighborhood will radically change in the next 10 or 15 years. The house is also big enough for anything we could conceivably need (maybe 2000 sq ft or a tad more).

Long term, I only expect housing to keep pace with inflation in my planning. Thus far, it has far outstripped inflation. Mostly, I don't really care, since this is a place to live rather than an investment. Assuming you are planning on staying put, the real way to look at a purchase is to see what your costs are relative to renting (interest, taxes, maintenance, and insurance vs rent). You then layer on all the lifestyle considerations. I think this is why lots of people continue to pile into the ousing market: the cash out for buying may be higher than the cash out for renting, but when you factor in the principal repayment and lifestyle considerations, it still works.

[Billy]

Good,.... you need a strong battery to keep that blender running!

Hold on down there.
Good Luck.

Billy
Website www.geocities.com/ba264

[cute fuzzy bunny]

Quote:

Going by the local grocery's empty shelves, everyone is pretty much stocked up on batteries and beer....

Same thing used to happen when I lived in new england and a big winter storm was coming.

I always wondered what people did with all those batteries...

As far as real estate transaction costs, I've sold my last two at a 1.5% sellers agent rate and a 2% buyers agent rate.

If your regular agent wont do 1.5%, there are entire companies that operate at that rate standard. 3% made sense prior to the internet and the MLS when an agent actually had to SELL your house. And 3% to the buyers agent also made sense 20 years ago when a house didnt cost much and the buyers agent had to hustle around looking for properties to show.

In the day of the internet, MLS and virtual tours, coupled with mid six figure home costs, 1-1.5% on each side makes more sense. I only offer 2% to the buyers agents because for less than that they'll skip over your listing when showing properties.

In fact, the final two homes I wanted to buy last year were ones that *I* found myself on www.realtor.com and brought to the agents attention. Later I noticed they were both 2% sellers agent sales.

The other thing to do if you're buying a house is to look at the offers brought to you by Costco and Sams Club. I went through costco for my buyers agent and as part of the deal she kicked back a little less thab 1/3 of the buyers agent commission (.85% of the sales price of the home). That came in handy. It was extremely easy, I filled out an online form from Lending Tree, later I got an email from them, then one from the buyers agent. I emailed the buyers agent back with my specifics and she called the next day with a list of properties to look at. After the sale was transacted, I filled out a short form, had the realtor sign it, and mailed it in. A few weeks later I got a check.

[KB]

TH, I've heard of people negotiating their sales fees, but not below 4%. If I stay in the area when I sell my next house, I'll check out Costco program for buying.

I sold my last house in December using Help-U-sell. I showed the house and the broker did all the paperwork, placed the ads for the open houses and provided the signs. He also did some negotiating with the buyers. I ended up paying a broker fee of 4950.00 and about 100.00 in flyers. The selling price was 324,000.00 so the percent ended up being pretty low.

I would absolutely do it again.

[wabmester]

Same here. I paid an agent $700 to list my place in the MLS and offered a full 3% to the selling agent. I simply don't understand why anybody would pay a listing agent 3% -- it's robbery.

[yelnad]

The fees all depend on where you live and the market in your area. My husband is a REALTOR. Around here the fees are about 5-6% of the price. 3% goes to the listing agent. His broker will take 50-60% of that. 2.7-2.9% goes to the buyer's agent. Her broker will take 50-60% of that.

We find that fee negotiating takes places in the higher end market, but never in the low to middle end, because there just aren't enough houses to meet the demand. Also, my husband can't really negotiate his fees. That has to come from his broker.

That all said, he only sells 3-4 houses a year. He keeps his license more for his own access to the MLS and prefers to make his living in other ways.

On the Rent vs. Buy debate,
my position is -- it depends.

Quote:
"I always wondered what people did with all those batteries... "
Ya gotta to be kidding right??

Re rent vs. own
History:
Rent: 4 apartments. Own: 5 houses (made 20K - 100K with 2, break even with 2, current one about 30% appreciation so far). My take-aways? it's all local markets not a generic housing boom or burst.

Personal preference: own 'cause 1) I clean it more often and 2) it give me a warm and fuzzy feeling.

[KB]

I'm with you on the warm and fuzzy feeling. I love having my own little bit of space in this world.

[brewer12345]

Quote:

I'm with you on the warm and fuzzy feeling. *I love having my own little bit of space in this world. *

Yep, just like one of my favorite quotes:

"You ain't no kind of man if you ain't got land."

- Delmar in "O Brother Where Art Thou"

Yeah, I've owned land. Quite a lot actually, but not much any more. It felt good, but it seemed to me that
the ROI could be a lot better. I miss it (owning a bunch
of land), but I am reconciled to keeping the money working. Would I rather just sit on it? You bet.
Alas, all of my money has to work so that I don't have to.

John Galt

[farmerEd]

Quote:

I'm with you on the warm and fuzzy feeling. *I love having my own little bit of space in this world. *

Same here...unfortuately I have yet to make a penny on any real estate transactions though...my problem is, the only places I buy are out in the boonies in non-glamourous areas...cause that is where I want to live...no doubt, I'd be better of finacially had a lived closer to a city, but oh well....

I'll trade all those $$$ for the opportunity to meander around my 200+ acres of land (surround by another 5000 or more acres of woods) anyday though...

[unclemick]

Heh, heh - I wish I owned the swamp 3 miles up the road - the guy has been making a bundle since before (25 yrs) we moved here leasing duck blinds to hunting clubs and groups. Land is ok - the right swamp is really good. Over the city/parish line - hence first legal shooting spot in the flyway. Of course - the smart ducks stay in the city part of the swamp.

Quote:

..... the only places I buy are out in the boonies in non-glamourous areas...cause that is where I want to live....

Around here, there seems to be a trend to build around what is coined as 'nature preserves'. Instead gazing out a fenced back yard you get to pretend that you live in the wood. At times the illusion is shattered when instead of woodland creatures you have the neighbors' cats tip toeing through your patch of wilderness.

[KB]

Floridian.....in what part of Florida do you live?