In The Sulky Forum
General Category => Political Talk => Topic started by: careless hal on February 17, 2012, 05:30:31 AM
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http://finance.yahoo.com/news/new-american-dream-is-renting-to-get-rich.html
I see a lot of the points made in the article. One of my places is now worth 25% less than I paid for it. The other, is worth more, but at least 25% less than I could have got several years ago.
Motrgage interest is a tax deduction, but politicos have long been making noises about taking that away. (welcome to another great depression. ) Of course, we could pull out of that when WW3
starts. But, life will not be the same in the post nuclear war world.
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There was a sales tax on real estate inserted into Obamacare to help finance that program. Of course Queen Nancy said, "We have to pass this bill so we'll know what's in it."
That is one scary statement.
Now the seller of a house has to give yet another pint of blood to the pols on every transaction.
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I'll be honest I did not read the article, but when you can buy a house for a mortgage payment thats
cheaper than paying rent I see no down side period.
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http://finance.yahoo.com/news/new-american-dream-is-renting-to-get-rich.html
I see a lot of the points made in the article. One of my places is now worth 25% less than I paid for it. The other, is worth more, but at least 25% less than I could have got several years ago.
Motrgage interest is a tax deduction, but politicos have long been making noises about taking that away. (welcome to another great depression. ) Of course, we could pull out of that when WW3
starts. But, life will not be the same in the post nuclear war world.
BTW you're lucky my house has lost about 40+ percent but luckily I sold everything else during the boom
before the bubble burst.
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I'll be honest I did not read the article, but when you can buy a house for a mortgage payment thats
cheaper than paying rent I see no down side period.
It depends on your situation. For long term living in the same place I would say yes, go ahead and buy. Young folks often will move several times over lets say the next 20 years. That makes it more of an iffy situation. I always sold any house I owned for a nice profit, after 5-12 years of living there. Now, that may not be the case. You could lose your downpayment and still not get enough to cover what is left after paying the mortgage off and the commissions. The city also has a tax you have to pay on real estate transactions. Add to that the Obamacare tax and you may be in a situation that you can't sell because you are underwater. That is why we see people just walking away. Also, it is not as easy to buy with a small or no down payment theses days. Just another thing you have to worry about.
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Those who are currently cash rich are far better off buying a house, even a second one for their kids right now. Since most of these homes can be purchased for 50-60 cents on the dollar of their true value (they were not worth as much as what the peaked at and they are not worth as little as they are priced now).
With cash paying less than 1%, buying a home is a better investment in the long term. Short-term, bridge jump a couple show bets. shootme
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Those who are currently cash rich are far better off buying a house, even a second one for their kids right now. Since most of these homes can be purchased for 50-60 cents on the dollar of their true value (they were not worth as much as what the peaked at and they are not worth as little as they are priced now).
With cash paying less than 1%, buying a home is a better investment in the long term. Short-term, bridge jump a couple show bets. shootme
Agreed !! Well might make an exception on the show bets.
So much depends on the individuals circumstance and location.
Here, in Central Kentucky the housing bubble burst had little consequence. Our place was appraised at $17K more than the last time we had it looked at (neighbor down the road is a bank real estate appraiser). Of course the tax assessor will love that but he hasn't been around---yet.
Our mortgage has five years to run but it was opened at 5.625% and a substantial down payment was made at the time of purchase. Not a lot of sense in re-financing since the payment is below $400 a month. If the liar - in - chief ever disallows the home mortgage interest deduction we'll simply pay the damned thing off.
The big thing making this place attractive is the property tax bill each year. Five acres, three stall barn, de-tached garage and attached two car garage. Three miles from town and taxes are less than $1K per year.
Point is, we ain't hurtin'!! We got out of Chicago just in time.
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Agreed !! Well might make an exception on the show bets.
So much depends on the individuals circumstance and location.
Here, in Central Kentucky the housing bubble burst had little consequence. Our place was appraised at $17K more than the last time we had it looked at (neighbor down the road is a bank real estate appraiser). Of course the tax assessor will love that but he hasn't been around---yet.
Our mortgage has five years to run but it was opened at 5.625% and a substantial down payment was made at the time of purchase. Not a lot of sense in re-financing since the payment is below $400 a month. If the liar - in - chief ever disallows the home mortgage interest deduction we'll simply pay the damned thing off.
The big thing making this place attractive is the property tax bill each year. Five acres, three stall barn, de-tached garage and attached two car garage. Three miles from town and taxes are less than $1K per year.
Point is, we ain't hurtin'!! We got out of Chicago just in time.
I can't wait to escape from this state ! Hopefully in a couple more years if not sooner, I am looking.
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I can't wait to escape from this state ! Hopefully in a couple more years if not sooner, I am looking.
My doctor has said I should move to Arizona or Vegas. Although he wouldn't write me a prescription so I could claim all costs as medical costs. There are only about 20 places I can think of off the top of my head where I'd rather live.
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Sure is odd that people's home value drops like a rock, but the proprty tax bill doesn't. >:(
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This article is so flawed, it leaves you scratching your head.
"for a home purchased at $200,000 by a buyer in the 27 percent marginal tax bracket. Factoring in a 30-year mortgage, $1,200 in annual home insurance, closing costs of $5,500 and maintenance costs of $100 a month, along with property taxes, he calculated that it would take a selling price, 10 years later, of $395,404 just to break even."
1 - a 30 year mortgage at 6% (they're allot lower now) means $1,000 per month in interest (At the start & it goes down from there) + his $100 maint., $100 insurance & lets say $200 in taxes, which is $1400 a month in "wasted" money over 10 years is $168,000.
2 - You'd still be paying rent & for a $200,000 property it's got to be at least $1500 a month which means you'd have paid $180,000 in rent over 10 years.
3 - You"re "break even" number is now reduced to $188,000 but remember if your amortized that $200,000 loan you'd owe $33,000 less meaning your real break even number is $155,000.
That's a pretty big difference from $398,000!
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This article is so flawed, it leaves you scratching your head.
"for a home purchased at $200,000 by a buyer in the 27 percent marginal tax bracket. Factoring in a 30-year mortgage, $1,200 in annual home insurance, closing costs of $5,500 and maintenance costs of $100 a month, along with property taxes, he calculated that it would take a selling price, 10 years later, of $395,404 just to break even."
1 - a 30 year mortgage at 6% (they're allot lower now) means $1,000 per month in interest (At the start & it goes down from there) + his $100 maint., $100 insurance & lets say $200 in taxes, which is $1400 a month in "wasted" money over 10 years is $168,000.
2 - You'd still be paying rent & for a $200,000 property it's got to be at least $1500 a month which means you'd have paid $180,000 in rent over 10 years.
3 - You"re "break even" number is now reduced to $188,000 but remember if your amortized that $200,000 loan you'd owe $33,000 less meaning your real break even number is $155,000.
That's a pretty big difference from $398,000!
I think the $398,000 is high also. However, $155,000 is low. Somewhere in between would lie the real cost. It all depends where you live. I pay $600 a month for real estate tax(my place is about 2500 sq ft.) $100 a month for maintenance? I think that is way on the low side. Obviously,now interest rates are at historic lows. However, I'd bet most first time buyers get a 5 yr
ARM. Most younger people I know don't live in one place for 10 years. If you are planning on living in the house for 10 years I'd say buy. If you are looking at 3-5 yrs,I'd say rent.
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I was just using his example with his numbers. If you consider his numbers accurate, the $155,000 is not low.
Hal, I wrote mortgages for 5 years in the 90's. I ran these numbers hundreds of times for home buyers & while I agree with you that $100 maintenance is low, it absolutely depends on where & what. In South Florida, you can't touch HO Insurance for less than $2500 on a $200k policy.
Remember I also used 6% & his numbers, which are just plain silly. He failed to take into account the $180,000 you'd pay in rent over those those 10 years. And that's assuming the rent never goes up, which NEVER happened to me when I was renting.
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That homowner/property insurance thing is becoming a real problem. Granted that our taxes are unusually low considering most of y'all. Our yearly insurance costs are approaching the amount we pay for taxes.
Cannot figure that one out !! 11 years on the place and zero claims. The price has increased 71%.
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Before I retired (early) I had everything paid off. House, trucks & cars, and trailers. But the damn taxes & insurance keep going up. I've had one homeowner's claim, and that was in 1972. For years hospitals have done what's called "cost shifting", where they jack up the fees on insured patients to cover for the un-insured. I suspect that the insurance companies jack up the rates on the 'non-claimers' to cover big payouts for things like Hurricane Katrina.
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I suspect that the insurance companies jack up the rates on the 'non-claimers' to cover big payouts for things like Hurricane Katrina.
Absolutely not!
When Wilma hit here, same year as Katrina, insurance co.'s just didn't & couldn't have enough in reserve to cover the massive losses, which were in excess of $29.1 BILLION.
First, there's no way an area can have anywhere near enough roofers, screeners ... to make repairs so the entire area falls prey to invading repair companies, totally unscrupulous & they all up their prices, sometime by 3, 4 or 5 fold, offering 20 year warranties & then going out of business within 2 years.
Replacing my screened in pool area, which was $5,000 to install a year prior, was allocated nearly $25,000! More than my shingle roof. And the insurance paid up.
My insurance did file a bankruptcy & the state took receivership, then offered alternative policies (state-run) when the insurance industry declined everyone's renewal. Since then, the insurance companies have come back little by little, easing the pressure for the state's fund but that is only because we have not had another hit since then.
Katrina cost $81 BILLION, 1/2 of that insured, but that does not include the economic impact. The US gov't reportedly gave New Orleans $200 Billion and experts claim the gov't could've just given every family $400,000 & spent the same!
Absurd, right?
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Oh, your right; Insurance Cos. don't use 'cost shifting'. What the hell was I thinking...
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Looks like someone misinterpreted a post
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Oh, your right; Insurance Cos. don't use 'cost shifting'. What the hell was I thinking...
I live 18 miles or so inland.
Every hurricane that has hit South FL did crazy damage within the 5 miles of the coast line. Except Wilma, which came in through the Everglades, which I am less than 2 miles from.
When the insurance company wrote my check for $50,000 it paid for many, many years of "cost-shifting" premiums.
You make me laugh with this terminology when it has been proven that there are no guarantees on who gets hammered.
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I live 18 miles or so inland.
Every hurricane that has hit South FL did crazy damage within the 5 miles of the coast line. Except Wilma, which came in through the Everglades, which I am less than 2 miles from.
When the insurance company wrote my check for $50,000 it paid for many, many years of "cost-shifting" premiums.
You make me laugh with this terminology when it has been proven that there are no guarantees on who gets hammered.
I think he meant that people that live in Illinois or Ohio will pay higher premiums because of the places that are close to disaster.
Of course, the regional insurance companies in that area went bankrupt.
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I live 18 miles or so inland.
Every hurricane that has hit South FL did crazy damage within the 5 miles of the coast line. Except Wilma, which came in through the Everglades, which I am less than 2 miles from.
When the insurance company wrote my check for $50,000 it paid for many, many years of "cost-shifting" premiums.
You make me laugh with this terminology when it has been proven that there are no guarantees on who gets hammered.
When I was working at the Union Carbide facility in Texas City, TX we had purchased a home in League City TX. That town is maybe 20 miles from Galveston and the Gulf of Mexico. One of the requirements established by the lending institution was that the property be insured as would a normal home PLUS we had to buy flood insurance which even then was a bit pricey since we were in the Gulf/Galveston Bay flood plain.
In my mind anyone living in places like South Texas, south LA, MS, ALA and all of Florida should find that flood and/or storm insurance is mandatory unless you own the place free and clear. Then it's up to you. BUT to see our insurance bills sky rocket in central Kentucky by over 70% isa bit frustrating.
I'll wait here and see if what's his name can tell me what I really meant.
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I'll wait here and see if what's his name can tell me what I really meant.
Instead of waiting you can reply to the thread where you said I have a lefty mind even though I am right of center. Sorry you cannot grasp that other people have comprehension skills.
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I just think it's been proven that there are disasters everywhere from tornadoes to hurricanes to earthquakes and floods. These disasters are just waiting to eat up your life savings or property insurance company.
We pay very high rates here for our risk and I'm certain that it's no different in other high risk areas but no doubt those areas are expanding.
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Instead of waiting you can reply to the thread where you said I have a lefty mind even though I am right of center. Sorry you cannot grasp that other people have comprehension skills.
Some people may !!
You ?----not so much !!!
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Some people may !!
You ?----not so much !!!
wow, you really burned me. Here I thought you only thought I was stupid because you thought I was a crazed left wing wacko.
I'd still bet 14 first class forever stamps that I know what Just Saying was talking about...
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wow, you really burned me. Here I thought you only thought I was stupid because you thought I was a crazed left wing wacko.
I'd still bet 14 first class forever stamps that I know what Just Saying was talking about...
Guy once told me that I'd find, when arguing with idiots, that they (the idiot) would be trying to raise himself to an intelligent level by trying to justify his stupid remarks. The guy was right and you just proved it so-----------------we'll se you later. Now don't bother me again sonny !!
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Guy once told me that I'd find, when arguing with idiots, that they (the idiot) would be trying to raise himself to an intelligent level by trying to justify his stupid remarks. The guy was right and you just proved it so-----------------we'll se you later. Now don't bother me again sonny !!
Yup that guy was very right and the more you post, the bigger idiot you become.
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Yup that guy was very right and the more you post, the bigger idiot you become.
I think the guy was arguing with Danville at the time.
Make fun of Hilary Clinton's looks... don't own up to it but instead blame it on how women are viewed in the middle east
Call me a lefty (not left handed) be informed of my voting record... completely ignore that and not apologize for being incorrect, but say I can't comprehend things...
not to mention seems to refuse to believe that someone could tell what Just Saying meant about cost shifting in less than 150 words.
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I think I am fairly openminded. ( my kids can stop laughing now ) lets just agree that some people will rub some people the wrong way no matter what is said. Doesn't make them more stupid or more smarter it is just mother nature having a good time. That 's my thought and I'm sticking to it. idunno Now you all have a good day.
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You just know you are cuter than Hillary
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I think I am fairly openminded. ( my kids can stop laughing now ) lets just agree that some people will rub some people the wrong way no matter what is said. Doesn't make them more stupid or more smarter it is just mother nature having a good time. That 's my thought and I'm sticking to it. idunno Now you all have a good day.
Oh shut up! rflmao1 rflmao1 rflmao1
It would make a pretty boring world if we all agreed on everything.
Besides: I'm the only one who's always right. 8)
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Oh shut up! rflmao1 rflmao1 rflmao1
It would make a pretty boring world if we all agreed on everything.
Besides: I'm the only one who's always right. 8)
Good Lord !! Cancel that lunch deal when you come through lexington !!! rflmao1 rflmao1 rflmao1 rflmao1
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Good Lord !! Cancel that lunch deal when you come through lexington !!! rflmao1 rflmao1 rflmao1 rflmao1
Oh shut up!
(I'll try anything to get out of buying lunch) rflmao1
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Oh shut up!
(I'll try anything to get out of buying lunch) rflmao1
Going to use that "left my wallet in the truck" ruse again? rflmao1 rflmao1 rflmao1
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See why I love this place. thumbsup