Many successful people rent because they don't want the hassle and expense of home ownership.  Especially if they live in an area with high home prices.  They're saving and investing their money elsewhere.

Ahhh, Irvine.
Used to live there myself, the market there is...interesting.
Pretty much all of the land there was either former Irvine Ranch property, which is owned by the Irvine company who essentially planned and developed the whole city, or former MCAS El Toro property. The Irvine Company also owns pretty much all the apartments in town. So, they pretty much control the ratio of single family to rental units, and they have been building both a a very rapid pace, even somewhat through the recession.


Anyhow, I bought my place cheap during the recession and sold it a year or two ago to some Chinese guys for almost 900k for a 2000 sq ft built about a half century ago. I was in town for something a couple months back and there was a shit ton of construction on that street... bunch of houses getting gutted and rebuilt, remodeled, and getting additions.

This is driving a lot of DFW's issues, we're getting CA companies moving their HQs here and bringing their employees with them.  They sell their shitboxes in CA for close to a million, then make large cash offers on the far cheaper TX homes.  

There seems to be around a $450k barrier the local market won't push above in general, but who knows if that'll hold.  I make pretty decent money, but even if my wife made the same for double the income, I don't think I would feel comfortable purchasing one of those.  I'm not sure how folks already in the area are affording it unless it's a two income family where both incomes are pretty high.  But not everyone can be doctors, lawyers, and CEOs.

With a housing bubble that's just as big as before. Locally houses are selling for MORE than the appraised value. The same thing happened before the bubble burst the last time. I'm finally in a position to be able to buy a house by I'm not stupid enough to buy a house for more than it's worth.

See, but then you have this thing called equity, which means that 1400 you've been putting into the house instead of running through the shredder renting can be taken back out when you make more money and want to move.

And I didn't know property values were so high in Somalia, always thought that place was a shithole.

I think he's saying you sound like an old man yelling at clouds.

He's right.

House upkeep and repair has never been easier and cheaper thanks to the Interwebz.

<-Gen Xer who's probably saved THOUSANDS with a little light Googling whenever I have house upgrayyeds/repairs/maintenance that I don't already know how to do.

Do you not understand how few boomers are able to fully retire and that rather than leaving an inheiritance the average American who dies today is leaving behind over $60,000 in debt? I suppose you could blame millenials for sponging off their grandparents but no,that really isn't the problem.

To be fair, owning also incurs the cost of maintaining so after you've used half of your take home to pay your mortgage, any single home repair becomes a disaster.  New HVAC?  Plumbing issues?  Roof need replaced?  None of those are survivable on that budget.

You aren't wrong.

My cousin 30 bought a house with some of that obama financing stuff and ended up losing it because he shot his mouth off a lot at work and was caught on the job smoking weed. A zero tolerance drug policy and he got canned I think it was 7th job in 3 years.  He complained about the upkeep and having to pay people to repair stuff.
He painted walls like old people fuck except he left zebra strips everywhere and thinned out the paint to where it looked worse than a child could do. He complained about having to mow the lawn, pick up other peoples garbage that blew into his yard.

The one time I was visiting and his car wouldn't start. I said probably battery is dead, so I jumped it for him and he drove down to the gas station a came back shut the car off and it wouldn't start. So I said hop in lets go get a new battery and install it. He looked at me and says I dont know how to do that I pay someone to do it. I said drive that car to autozone and tell them you don't have any idea on how to replace it and they will show you. He says no I would rather pay someone than get a freebie lesson.

I thought for a second and said when was the last time you added windshield washer fluid, him never, I pay someone to do that and everything else on the car.

He asks me, so you know how to do all of that repair work?  I said yeah takes like minutes to get that piddly shit done, I've done complete vehicle rebuilds those take months. This stuff you pay people to do shows you have no initiative or desire to learn mechanics you are being lazy and careless with money one day you will regret being this way.  
Its not like I wasnt going to help he just didnt want to learn and I didnt go there to fix shit for people who should otherwise be able to. To make matters worse he says I need to fix the cat tree because the carpet is coming off I said get a straight screw driver, needle nose pliers and a phillips bit for the screw gun.  He brought out a ratchet, wire dykes, and a stapler.   When his mother came home I asked her if her son was firing on all cylinders, I asked for a phillips screw driver and he brings me a ratchet.

Fucking Millennials no hope for humanity.

They are building them as fast as companies can soak up property around here.

I think a lot of it has to do with the location. My city used to be well in the top 100, but due to some splitting of lines in the county it is now JUST outside, somewhere around 103 or so.

Born in 1985, and I would say my experience is on the opposite side of you, the people around my age, and slightly younger, that I know, seem to be about 75% homeowner to renter.

But I live in a conservative area. Surrounding areas are dominated by farm country/rural areas. Predominantly white.

Yep I am a millennial and I bought my house, but I rent it back to myself every month.

The double taxation kind of sucks though.

But other people's money, Am I rite?

There are a few exceptional Millennials out there, I've had the pleasure of working with two of them and they stand out like the Hope Diamond in a sea of shit.  

If you are in a place where you are renting a 3 bedroom house for only $400 a month... Then you can find a home with a low mortgage. That is fucking piddly rent. Like what you would pay when your parents owned the place type rent.

Either that or you are in a rent control place that has been locked in for 50 years.

It actually has a lot to do with how risk averse millennials are as a whole.

Even if they had enough coin to put down on a house, they don't want to part with it.

damn, that's about $1600 down here.

some of these threads are really goofy

the subject of rent vs buy was old hat in 1000 AD.   I think Socrates talked about it

it has exactly dick and shit to do with millenials being irresponsible

you can plug all the numbers into a bunch of websites and it will tell you whether it's cheaper to rent or buy

math, how does it work?

you can do the same thing to figure out if being a landlord is a smart move for a particular situation.


a lot of people think that buying is automatically the best answer but it's not necessarily so

interesting, yea I could see that. More rural areas should in theory have higher home ownership rates. I'm in a mix of rural farming/ranching but is also a tourist/resort town with a ski area so housing prices are stupid high near the resort/ski area thus more renters. Basically a lot of service industry and shit paying jobs and high rent = cram as many ski bums as you can into a house/condo/apt to make the rent.

Stop being stupid please.

Well, unless "rent" is around $300 then no...no, it's not stupid.  Rent is probably around $1000-1100.

There is a real lack of affordable new homes.  Almost all of the new construction I see is for houses over 2,000 Sq. Ft.  

If they want more people to buy new homes they need to build smaller quality (1,200ish) homes with open floor plans and good use of space.

Only if the housing market goes up.  If the market tanks, there goes all your equity.

The first bubble nearly ruined me, we were young and bought high.  I want no part of the current market.  We aren't staying put, and by the time you pay realtor fees and lawyers, any equity I could build up in a short time will be gone.  Not to mention maintenance.  Our ac went out in our last home, 6k out the window.  Countless hours painting/repairing.  

I'm holding out until this giant bubble pops again, then I'll jump.   I have cash in hand, but won't spend it until it's a good buy.


I do think owning is substantially better if you are planning to stay a while, and can buy in a decent market.  Right now ain't it.

Yes, but how much equity depends on the area and how long you plan to stay.  You've got to consider that 6-7% you've got to cover when you sell.

millenial

If I had a dollar for everybody that I heard saying the next crash is coming because "bubble"...You may be holding out for a decade before you see a decent decline. People have been saying the same crap and predicting/expecting a crash in housing/stocks, ect. for awhile now. Eventually they'll be right, lol

https://www.bloomberg.com/news/articles/2016-07-18/it-s-not-a-housing-bubble-it-s-just-expensive

And risk.  I'm currently paying $2,300 per month for a place in the Seattle area.  That's a lot of money, but my landlord is spending over $1k more than that per month since property taxes and condo fees are so expensive.  I don't want to tie-up my money or take the risk.z

Not only that, but you have property taxes and home insurance that are not recoverable as well.  I was this >< close to buying a new build in a brand new development just north of denver until I ran all the numbers.  Due to the ridiculous added mill levy on the taxes for the new development, it would take 239 months before I was actually in the black on that house.  That's practically 20 years before it became a better deal to buy that house versus renting at $150 per month over my current lease rate!  

So, we bought a slightly less expensive house in an older neighborhood just a few miles away.  My "in the black" date on this home will be approximately 40 months.  At that same 40 month mark on the new construction, I was approximately 45k better off by renting.

Sometimes it actually does make more sense to rent, especially when dealing with high tax locations.

You think your landlord is nice enough to take a $1k a month loss?

What's his number?

Some areas it's much cheaper to rent.  A friend of ours out in San Jose is paying over $3000/mo for a 2/2 apartment.  Of course, median home price is around $1 million.

Zoning laws are made to benefit the people who are "friends" of the politicians in charge. If you could have a reasonable size starter house built, they would not be able to rent their "future ghetto apartments" for as much as they do.

Increase in home purchase costs, stagnant wages, people who spend 95% of take home, perceived risk of home ownership after a market crash......

Yep.  None of those things are influencing this...not at all.

Plus one.

I am in NoVA, one of the most expensive counties in US.
My income does not keep up with sky high prices. Average house here is 600k and up. You need dual near 100k incomes to make it and to buya house. One income for the house and one to live on. A single 90k salary is barely out of the poverty zone. This aint kansas, Toto.

I rent for about 800/month and it is a steal. Rooms go for 1000.

I don't even have to read the article to tell you it's bullshit. False premise, cherry picked statistics.

The "100 Largest Cities". What marks large cities? High density, multi family housing. This alone does not lend itself to home ownership.

Look at the two examples:

Detroit, really? Traditionally home ownership was driven by a couple things; You have to live somewhere. Why not put that money into building equity in a property that you own? Also the general expectation is that your property will increase in value. Who has expectations of property value increases in Detroit? Or wants to live there long term, given other choices?

Irvine (I assume they mean CA), who the hell can afford to buy in CA? People that own there are cashing out to move to CO (and fucking it up in the bargain) or other similar states.

My perception is that the financial and social demographics of the US are changing and the changes do not favor home ownership. Financially the better paying blue collar jobs; manufacturing and technical/engineering jobs are going, going, gone. And socially speaking, being Ghetto rich has taken precedent over being financially secure. Statistic on FBN this morning, 21% save nothing and only 25% save just 10% or more of their income. Think about that for a second, 75% of the US population save less than 10% of their income. And about a third of those save nothing at all.

Let's see stats for a list that includes cities like; Tyler TX, Marshalltown IA, Scranton PA, Las Cruces NM, Pueblo CO, Athens GA.

engineer

math is your friend

empty speculation is your enemy

Its not just denver.  I sold a house a year ago.  Only showed it for one day, had competing offers, one offer was "$5k in cash above anyone else's offer."

This ^ LOL

Plus one.

The thing with rural real estate, it is even worse. You go to podunkville, south dakota or nebraska or west VA, and you might find houses for about 100k but there is absolutely no work there , especially for younger people.
In general, young people leave for large cities to pursue their careers. I lived rurally, almost lost my shirt. There is no work and most get income out of state not connected to the local economy. Retirement, some kind of pension.

There is no work at all in rural america and a 100k house is not affordable via local economy.

I lived in a place where 9/hour home depot jobs 45 mins away were considered good jobs by the locals.

Seems like many young people think they should have a house as big or bigger than their parents.....even though it took a lifetime for the parents to move up to their big house. Unable to purchase a big house, they just rent one....and lease a couple of fancy cars too. The "ME" generations are here to stay.

We close in a couple weeks but prior to finding this house we spent a morning out with our realtor.  We had planned to look at 4 houses that day.  The first house we looked at just came open for showings that morning and we were in to look at it by 10am.  Nice house and a contender but we still wanted to check out the others.  Before we even made it to look at house number 4, the realtor calls us to say that the first house already has multiple offers and one offer is 15k over ask with an appraisal guarantee.  It's fucking insane out here.

I live just over an hour north of you, and I pay a 3500 a month mortgage, 5 acres, 2 shops, big house, private shooting range. Y'all are nuts!

He bought the place thinking it would go up in value enough to make-up for the difference then 2008 happened.  The place has increased in value about $40k over ten years which only covers about a third of what he has spent over what I've paid.  He took a risk and so far has lost, but with prices around here increasing quickly, he might still come out ahead in the long run.z

I currently own four homes I rent out. At one time I could pick up a 1,200 sqft bank owned home in a semi decent part of town for $50-$60k all day every day. Another $5-$8k in paint, carpet, builders grade cabinets and fixtures and I can rent that same home out for $1,000/month with a line of applicants a mile long. Sadly banks aren't unloading foreclosed property like they were to but the qualified renters are still abundant. In a few more years I will have recovered all of my initial investment and those properties will become a self filling cash register.

It's a landlords paradise.

Bigger homes mean bigger assessments which means more tax money to the cities coffers.

If there are lenders doling out loans for people paying 45% of their income for housing we truly are on a bubble.

BINGO!!!!!!!!!!!!!!!

Only a few.

Yep my rental made me quit a bit of money before I sold it.