this post was submitted on 29 Oct 2024

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Climate Change Should Make You Rethink Homeownership (www.nytimes.com)

submitted 6 days ago by [email protected] to c/[email protected]

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[–] [email protected] 8 points 5 days ago

I don't agree with this article unless they're solely talking about living in a disaster-prone area like Florida. There's going to be risks with homeownership just like there's going to be risks with owning anything, especially thanks to climate change and increasing natural disasters.

Honestly, this article leans more on the side of the mentality of landlords, since it essentially is saying 'the world is risky, let landlords shoulder this burden' and doesn't even acknowledge that you gain no future equity from renting. You can walk away from a rental with nothing but at least you can sell a house and regain some, if not all, of its value.

Leasing businesses and local landlords have bought up so many houses that people would've normally been able to afford and now want you to rent them instead of buy them. We don't need more reasons for renting to be the only option some have.

[–] [email protected] 2 points 5 days ago

Another US centric article.

[–] [email protected] 2 points 6 days ago (2 children)

also, cost. homeowner ship doesn't really make sense in a lot of situations anymore in the US If your mortgage costs significantly more than rent.

[–] [email protected] 7 points 6 days ago (1 children)

Yeah but at this point, I don't know a single person or family paying higher mortgage costs than the average rent in an area, across multiple northern and southern states.

[–] [email protected] 0 points 6 days ago (1 children)

True enough inside any sizable cities.

I'm factoring in traveling but didn't make that clear.

there are still a lot of rentals you can find outside of cities for 10 to 15 bucks a day with monthly specials, or there were a year ago when I was driving across the country last year.

If living 45 minutes outside of the city proper, you can get pretty good rental rates.

[–] [email protected] 2 points 5 days ago

There are no rentals on any rental website or Craigslist for less than 700, with those specifically usually being 55+/Medicare subsidized communities.

[–] [email protected] 3 points 5 days ago (1 children)

Have an asset that likely with appreciate, paid off after 30 years. Or continue to pay for a place to live for 60 years?

Financially, if you can afford it, housing is a good way to solidify your worth and lay a foundation for your future and retirement. If you pay off your mortgage, by the time you retire hopefully your set income won't have to pay for housing anymore. Only property tax and maintenance.

[–] [email protected] 2 points 5 days ago* (last edited 5 days ago) (2 children)

"Have an asset that likely with appreciate, paid off after 30 years."

big assumptions with no starting values.

are you paying 500k off? 750k?

are you adding in the cost of home repair?

escrow and finalization fees?

interest from your mortgage?

how about utilities?

property tax?

capital gains tax?

If you take average numbers for the costs of American homes right now (450-500k) plus all the practical costs of owning property, it is still cheaper to rent for 60 years at $1,000 a month rent then to pay for that house over 30 years. Indian

[–] [email protected] 4 points 5 days ago

Who the fuck is paying only $1000 in rent?

But that aside, no, renting is always more expensive than owning. Landlords are not renting residences out of the kindness of their hearts.

All of those expenses PLUS profit margin go into your rent price, there fore renting is always more expensive.

[–] [email protected] 3 points 5 days ago (1 children)

380k with a 30 year mortgage and something like $25k down. Amortization on 5.89% will show at the end of it, you'll pay over 774k for it. Mortgage payment would be $2150. That's after closing costs. Property insurance and property taxes about $700/mo. And I live in a high property tax area.

Utilities aren't included, but I haven't seen many rentals that include utilities either. The house may be bigger and use more utilities though.

The lowest rent in my area for 3 bedrooms is 2.2k/mo and that's an outlier. Most are $2,700+/mo. If I were to pay the $2.7k for 30 years, that's just shy of $1 million. And at $2200, it's just shy of $800k in 30 years. That's break even.

This isn't even addressing the instability of rental prices. My mortgage payment is locked in, at a fixed interest rate. If I were to rent, there is no guarantee that the rent i am paying today is the rent I'll be paying in 5 years.

Renters should be getting renters insurance too, so add that to the renters side.

Yea, I will have home repairs I'll need to pay for. But I'll also have equity that I can leverage for them if I need to. I'd have to put in $200k in the course of 30 years to match what a renter in my area would be spending. And that's just repairs, if I were to spend on renovations and/or additions than it would raise the property value.

As for capital gains, that's only when I sell, but if I have to pay taxes because I made money. Well, then I made money instead of... Only spent money?

If the house doesn't appreciate and only holds it's value, it's an asset that protects against inflation.

[–] [email protected] 1 points 5 days ago* (last edited 5 days ago)

yeah, that checks out

if literally everything goes beyond right with your home purchase, you beat the market price by 100k, low property taxes, no emergency costs, you don't have any repairs, vs. you choose to rent near the center of the city and everything goes wrong with renting, then a home purchase can begin to match the convenience and more economical choice of renting.

overall and on equal footing, it's cheaper to rent plus you don't have to pay any of the necessary maintenance costs, utilities depending on the property or any taxes.

and renting is way less time and trouble.

[–] [email protected] -2 points 6 days ago (1 children)

I never understood why some people insist on owning property. Especially more than one. Never really able to afford it myself. The Army (UK) cushioned me for a while and then when I left, there was no way to get a mortgage. Maybe if I'd saved instead of enjoying myself. Too late now though.

[–] [email protected] 10 points 5 days ago (2 children)

Owning your home outright nearly gurantees you have the basic need of housing meet and that is by far the most expensive to meet in developed countries. Food, water, heating and electricity are not that expensive. That gives you quite a bit of security especially when you get older. The big problem is obviously to be able to afford buying a property in the first place, which is hard.

[–] [email protected] 3 points 5 days ago

About that food, water, heating and electricity not being that expensive. I'm afraid that won't be so true in the future. UK is leading here.

[–] [email protected] 1 points 5 days ago

'Food, water, heating and electricity are not that expensive'

Should have mentioned I'm in UK. That sentence doesn't apply anymore.