"keep your mortgage for 30 years making the same mortgage payment you will have an asset worth hundreds of thousands of dollars."

You left out the part about being owned by the bank for 30 years.

Putin, please rent. I love it. How's that trailer park treating you. Hehe. I love it.

For all of you out there that think Putins ideas are the right thing for you, you deserve whatever it is that you get. Hahaha

"the RISK, and it is risk, is small"
"resale will not be an issue"

I don't know man. Look up a 3 bedroom house in Mill Valley, CA on zillow. This town was mentioned as desirable and stable by The Hanged Man. (I'm reluctant to post links here because, creepily, they are actual people's houses). Ignore the specific house and look at the line for "Mill Valley" in the 10-year chart they provide. It looks like a sine wave oscillating between 900K and 1.2M. You don't want life circumstances to cause you to buy at the peak and sell into the low point.

"Who the fuck has the same lifestyle for 30 years that living in the same place makes sense? Boring people."

Indeed.

The people calling this a joke are those who haven't seen past their own geography. Not every cities economy is the same and not everywhere does it automatically make sense to buy over rent. I'm from Vancouver, BC for example where you're going to need $1M+ to get a detached starter home. In an environment where salaries aren't inflated to match that price tag the concept of house poor is a very real thing that many encounter, you can be looking at upwards to 92% of your incoming going towards household expenses here. Sure real estate prices continue to rise, but should it ever not those who put money into these homes could be crippled.

On the flip side, in this city renting isn't inflated quite as insanely. It's still expensive but rent generally doesn't cover the full expense of the owners mortgage and costs but treated as acceptable since it's still a growing investment for the owner. Buying vs renting in this city makes an incredibly significant impact on the type of lifestyle the average person can afford.

Again, and I said it before, and to VI's point. It's all relative to your own personal finances. Now, and lending standards have changed, people who are looking to spend a million plus on a house, should be able to afford the fluctuations that go along with owning an asset like that. Most of the time, I believe , benefit will come from that, but as any given investment goes, it can go lower. Make decisions based on your current economic status.

you can be looking at upwards to 92% of your incoming going towards household expenses here.....
If this is the case, then owning is not appropriate. No more than 1/3 of your monthly income should go towards owning your home, this is not inclusive of maintenance or taxes and insurance.

Is anybody seriously going to take financial advice from a FICC trader?

"Factored into rent? Yeah, a trivial amount. Furthermore the lease means the landlord cannot raise rent until the lease is up, and you can always move somewhere cheaper."

Yeah, a "trivial" amount because the tax burden is divided by twelve. It's still factored into the rent you pay. How else do you think the landlord gets the money to pay the property tax? As for maintenance costs, it is also put into your rent. It's effectively an insurance policy built into your rental payment. Again, how else can the landlord get the money to pay for these things?

Yeah, the rent can't be raised during the lease. But leases generally only last a year. Then the rent can be raised. A fixed-rate mortgage payment will be the same all thirty years. Effectively you're paying 2014 dollars on your 2034 payments. Not a bad deal.


AGAIN, it depends on each person and each market. Sometimes it will be a better idea to rent. Sometimes it will be a better idea to buy. It depends. Saying home ownership is a bad idea in all circumstances is really, really stupid. Shockingly stupid.

"Is anybody seriously going to take financial advice from a FICC trader?"

Is anybody seriously going to take financial advice from a communist?

Well, the Taxpayer Relief Act of 1997 made home ownership a much better investment than similar risk related enterprises. You are going to pay capital gains on anything else. But I like being able to make a single phone call any time I have any sort of issue, so I use the headache free option of renting.

"Yeah, a "trivial" amount because the tax burden is divided by twelve. It's still factored into the rent you pay. How else do you think the landlord gets the money to pay the property tax?"

So you're claiming the tenants pay the full amount of the property tax? Bullshit.

"As for maintenance costs, it is also put into your rent. It's effectively an insurance policy built into your rental payment. "

So you're saying tenants pay the full amount of maintenance costs? Again bullshit.


"Then the rent can be raised. "

Not if there is rent control. Ironically people like you always oppose rent control, because you want property owners bilking people.

Putin, I'm not giving financial advice, quite honestly I could care less what anyone else does with their money, although I am qualified to give such advice....but for you, Putin please rent. What does it matter to you anyway. You will have no descendants. Which is good for all. Yeah.

"Is anybody seriously going to take financial advice from a communist?"

Yes actually.

"So you're claiming the tenants pay the full amount of the property tax? Bullshit."

Again, it depends. Landlords are in the business of making money. Their tax burden is factored into the rent they charge.

"So you're saying tenants pay the full amount of maintenance costs? Again bullshit."

I said it was effectively an insurance policy. You are still paying for the maintenance services the landlord provides. Again, this is a business.

"Not if there is rent control. Ironically people like you always oppose rent control, because you want property owners bilking people."

It's well established that rent control does more harm than good. And regardless, very few places have it. In the vast majority of cases, people's rent can change. That cannot happen with fixed-rate mortgages.


Given the choice between listening to an investment banker's and a communist's financial advice (or even just offhand commentary like we're doing here) anyone who isn't a fucking moron will listen to the investment banker.

"A fixed-rate mortgage payment will be the same all thirty years. Effectively you're paying 2014 dollars on your 2034 payments. "

Mortgage rates are not based on inflation. Mortgage rates are higher than inflation. Do you think banks are stupid?

Because investment bankers record of sound advice has been terrific. 2008-2009 never happened.

"It's well established that rent control does more harm than good. "

Another heads you win, tails you lose argument. Whine about rent control, but use the non-existence of rent control to argue for home ownership. Brilliant.

*tails I lose

Every time a bank lends money they immediately hedge their risk. They are not in the business of speculating. They will lock in their money based on the current value of the 30 years bond or any other interest rate product, depending on type of loan and wait.

@Invictus

“Given the choice between listening to an investment banker's and a communist's financial advice (or even just offhand commentary like we're doing here) anyone who isn't a fucking moron will listen to the investment banker.”

No no no! You shouldn’t listen to either of them. Both of them make a living betting other people’s money and keeping a big cut of the winnings for themselves. They’re both in the business of socializing losses to others and concentrating gains to themselves.

Really? The socialist leaders who fell in '89-'90 were arrested and or murdered by the thugs who took over. What happened to the bankers who gave bad advice?

Oh, banks can predict future inflation rates now? If your payment is $1,100 a month in 2014 it will be $1,100 a month in 2034 as well. The bank makes money and you have a set payment that gets more affordable as time goes by AND you own the house outright at the end. For many people that's a good deal.

Once more, it depends on the individual and market. For some renting is the best idea. For some buying is the best idea.

@invictus, let Putin rent....let Tendmote as well.... Doesn't matter.

"Because investment bankers record of sound advice has been terrific. 2008-2009 never happened. "

And communists' record of sound advice has been terrific. The 20th century never happened.

Cuba has withstood 60 years of sanctions and terrorism. China has been growing despite the west's best efforts to tank the world economy.

Yeah I'd say so.

If you want to listen to people who have been wrong about everything in the past 8 years and who tout the advice of investment bankers while opposing rent control. Go for it.

China's been growing because it's embraced capitalism. Cuba survives because of Venezuelan handouts, and only lasted before then because of Soviet ones.

If someone bought a home 30 years ago, there were only a handful of years where the inflation rate met or exceeded the inflation of 1984.

The notion that homeownership beats inflation is just another lie the snakeoil salesmen get to allow the banks to own you.

Rent control is almost universally acknowledged to be a bad idea by economists.