Really good article about the economy

[Todd#43]

Well lucky for me remolding cost is very low, And the ppl around me have sold for more than 160 on most accounts...So I'm not worried about not getting my 50 ...I could get it now and make good investments And have just as much worth as I do on paper.Still its money I can gat any time I want to use it.For what I see fit ....IMO I think thats a good investment.

I'm a little different than most I made the cash and made sure I could afford it BEFORE I jump in to all this.The idea of renting is crazy .....this way at some point w/ a house (as long as you don't fuk up)you will get what you put in to it "kinda living for free" sell it get your money back even if its lower by a few % its better than renting< you get nothing and you paid off someone else's shit .

Ok, so 160 minus 120 is only 40 - not 50, and you still haven't totalled ALL of the costs of home ownership. Money on paper is not the same as cash in your pocket. There is a cost involved in "having" it.

What gets me is people that say renting is "throwing money away". I rent now, and have owned, sold and flipped houses way before it was fashionable. You think I "get nothing" for renting? I have a nice place to live, and that has a definite value. I don't have any debt, and havent created any "paper wealth". I have someone to cut the grass, shovel the snow, and fix shit when it breaks - all without any out of pocket expenses on my part.

To top it all off, when the place I'm living in no longer suits my needs I can pack my stuff and move - all without the hassle of selling my dwelling and hoping against hope that I can put money in my pocket, or waiting six to nine months to have cash to be able to put into another place.

[Angrish]

Housing is still a good investment. Right now fo sho if you have money now is the time to buy As the econmy goes up so will housing now is the time to buy if you have money....I have firends that buy rehab and sell they are still doing well right now they just start buying eastside cheap houses buying them for 35000 to 50000 and putting 7000 or so in to it and having no issue selling at 110000. I do all their plumbing .Don't get me wrong it has slowed down but some of that has to do w/weather also .They are making a killing.

12% return thats pretty good for a few months work.no?

[Angrish]

Ok, so 160 minus 120 is only 40 - not 50, and you still haven't totalled ALL of the costs of home ownership. Money on paper is not the same as cash in your pocket. There is a cost involved in "having" it.

What gets me is people that say renting is "throwing money away". I rent now, and have owned, sold and flipped houses way before it was fashionable. You think I "get nothing" for renting? I have a nice place to live, and that has a definite value. I don't have any debt, and havent created any "paper wealth". I have someone to cut the grass, shovel the snow, and fix shit when it breaks - all without any out of pocket expenses on my part.

To top it all off, when the place I'm living in no longer suits my needs I can pack my stuff and move - all without the hassle of selling my dwelling and hoping against hope that I can put money in my pocket, or waiting six to nine months to have cash to be able to put into another place.

good point but you get no return on all the moneys spent.You pay out by have nothing of any value or solid assets.No worth on paper just your money in the bank ..........I have money in the bank plus valued assets worth a fair amount of money.Witch allows me to borrow to make my company bigger or whatever you no what I mean.

[Angrish]

Wait a min you said you flip a house so why would you tell me its not a good investment ...you did it w/ some successs!!right?

[Todd#43]

Your right .....untill I sell it...than your wrong....

Adding my bathrooms and laundrys are worth 15,000 + alone why would you think I'm not making money off this deal ?I'm not selling 2morro

1000 included paint.And to be honest it was less than that the work I traded for cost me about 400 bucks

When I sell I'll make more than 50,000 10 or 20 more Depending on the market. But as long as it comes even close to what it was I'm getting a 35% return in 7 or so years ..thats not a bad investment is it?

Dude, you really don't get it do you? If you think you can realize 35% on your investment in seven years, you gotta be smoking crack. You might have 50k in "equity" but thats just money to leverage more debt. Its not real. Again, you need to add up ALL the costs. Total of your mortgage payments, property taxes, repairs and improvements (including your time), and don't forget to account for inflation - about 3% annually.

So, with no other costs figured in, your 35% gain over 7 years is 5%, minus inflation. Now were down to 2% net gain per year. Whats the APR on your mortgage? If its more than 2% you're losing money. Losing money (real dollars) is NOT a good investment.

Buy a house if you want a house - that's all cool. Just don't try to convince people that you bought it as an investment. There are much better ways to actually MAKE money with money.

Yes, I flipped houses back in the 90's when you could make some money doing it. Rates were low, and banks were giving money away for free to people that couldn't really afford it. You cant do that now.

[Todd#43]

good point but you get no return on all the moneys spent.You pay out by have nothing of any value or solid assets.No worth on paper just your money in the bank ..........I have money in the bank plus valued assets worth a fair amount of money.Witch allows me to borrow to make my company bigger or whatever you no what I mean.

I do have a return on my money - a roof over my head for a period of time. I have plenty of other "assets" - retirement accounts (money in the bank), commercial real estate, and own part of a company.

What I don't have is personal debt, or a bunch of "equity" to create more debt.

[Angrish]

Dude, you really don't get it do you? If you think you can realize 35% on your investment in seven years, you gotta be smoking crack. You might have 50k in "equity" but thats just money to leverage more debt. Its not real. Again, you need to add up ALL the costs. Total of your mortgage payments, property taxes, repairs and improvements (including your time), and don't forget to account for inflation - about 3% annually.

So, with no other costs figured in, your 35% gain over 7 years is 5%, minus inflation. Now were down to 2% net gain per year. Whats the APR on your mortgage? If its more than 2% you're losing money. Losing money (real dollars) is NOT a good investment.

Buy a house if you want a house - that's all cool. Just don't try to convince people that you bought it as an investment. There are much better ways to actually MAKE money with money.

Yes, I flipped houses back in the 90's when you could make some money doing it. Rates were low, and banks were giving money away for free to people that couldn't really afford it. You cant do that now.

I made this investment 9 years ago And sorry to tell you I'm making money on this investment. I will make 35% on it. Time frame can be argued all day. But sorry to tell you I'm making money on this deal.When I sell the money goes in my bank account.

It is a good investment I own something for my money....what do you own when you rent? My inssurance covers a 160,00 dollor home I paid w/ remodel about 120,000 ........160 was apraise 3years ago I'm doing very good in this investment......And If anything I'll get the money I put in to it out of it...What are you going to make of renting ....how is renting a good investment beside convence.....convence does't pay you .Selling assets does.

And everything I do to the house is a write off...my income...save taxes...

[Angrish]

When you sell "equity" becomes money.Not more debt unless you choose to.

I'm not saying housing is the best investment ,But it is pretty solid when it comes to making some money "even a little" ..I won't talk about other investments because ppl look at things diff. but buying a house is a good move for someone look to have a place they can do anyting they want w/o asking , and get a return after a few years. It also helps w/ want lenders think,and even some jobs will base your charcter off of your level of commitment.making good on a long term contrct.Not saying everyone should run out a buy a home. I my situation I will make out very well.

[Angrish]

I do have a return on my money - a roof over my head for a period of time. I have plenty of other "assets" - retirement accounts (money in the bank), commercial real estate, and own part of a company.

What I don't have is personal debt, or a bunch of "equity" to create more debt.

"assets"? Cars and bike don't count!!J/K

[Todd#43]

"assets"? Cars and bike don't count!!J/K

I own bikes, but they're not investments. You cant make money on items that depreciate.

Although a house may increase in value (not very quickly lately) the increase in value doesn't happen fast enough for you to realize any money.

You've owned the house for nine years, right? If your payment (principle and interest) is more than $500 per month, you've already spent at least $54,000.00. Lets add a conservative $3000 in annual real estate taxes, for a total of $81,000.00 spent. How much time have you spent "working" on your house - cutting grass, shoveling snow, painting and other general maintenance? Is 100 hours a year enough? What do you bill your customers for an hour of your time? $90? more, less? Add another $10,000.00 for that (maybe more, maybe less) and you've got at least $90,000 total spent. Homeowners insurance another $2,700?? Lets say you spent another $7,000.00 in supplies and materials over the last 9 years for regular maintenance and improvements. Nine years of Home ownership has easily cost you $100,000.00.

Now, you've paid to date $220,000.00 for your $180,000.00 house. At 9 years a 120,000 mortgage (at 5.5% for 30 years) still has a payoff of around $102,000.00. $180,000-102,000=78,000.00 in equity. You've spent $100,000.00 to date on your house. $78,000.00-$100,000.00=($22,000.00). In 9 years you've "lost" $22,000.00. Offset the tax savings and you've lost a little less, but you get the picture.

In the last 5 years, I've spent more than that on rent for sure. But I've never said that renting was an "investment".

[Angrish]

I own bikes, but they're not investments. You cant make money on items that depreciate.

Although a house may increase in value (not very quickly lately) the increase in value doesn't happen fast enough for you to realize any money.

You've owned the house for nine years, right? If your payment (principle and interest) is more than $500 per month, you've already spent at least $54,000.00. Lets add a conservative $3000 in annual real estate taxes, for a total of $81,000.00 spent. How much time have you spent "working" on your house - cutting grass, shoveling snow, painting and other general maintenance? Is 100 hours a year enough? What do you bill your customers for an hour of your time? $90? more, less? Add another $10,000.00 for that (maybe more, maybe less) and you've got at least $90,000 total spent. Homeowners insurance another $2,700?? Lets say you spent another $7,000.00 in supplies and materials over the last 9 years for regular maintenance and improvements. Nine years of Home ownership has easily cost you $100,000.00.

Now, you've paid to date $220,000.00 for your $180,000.00 house. At 9 years a 120,000 mortgage (at 5.5% for 30 years) still has a payoff of around $102,000.00. $180,000-102,000=78,000.00 in equity. You've spent $100,000.00 to date on your house. $78,000.00-$100,000.00=($22,000.00). In 9 years you've "lost" $22,000.00. Offset the tax savings and you've lost a little less, but you get the picture.

In the last 5 years, I've spent more than that on rent for sure. But I've never said that renting was an "investment".

Its a 15 year loan ..And I owe no where even close to what you are talking about.not even 1/2 of your total 102.I understand what you are saying it just doesn't apply to me.I am making $$ with this deal You can talk till your blue in the face ....Buying a house from someone in forcloser is a good investment. I spent 100 grand and owe about 40 more ......where did I lose 22,000? Selling today I will make about 40 grand give or take.

Investments are a risk no matter what ....but you trying to tell me I'm not making money is pretty funny ....You own 1/2 of a company you should know better than that ..I no everyone is big time now a days and Knows better than everyone else right!? come on why would you want to bust my balls because I am making a dime off an investment you don't believe is an investment.I'm sorry if you don't believe me ...maybe your believer is broken?I made a good safe choice that has and is paying off good for me.I can't really go any deeper sorry I guess you win ? I hope thats better.:wink:

10,000 for maintenance is close guess but most of that is a write off anyway?

[Todd#43]

Its a 15 year loan ..And I owe no where even close to what you are talking about.not even 1/2 of your total 102.I understand what you are saying it just doesn't apply to me.I am making $$ with this deal You can talk till your blue in the face ....Buying a house from someone in forcloser is a good investment. I spent 100 grand and owe about 40 more ......where did I lose 22,000? Selling today I will make about 40 grand give or take.

Investments are a risk no matter what ....but you trying to tell me I'm not making money is pretty funny ....You own 1/2 of a company you should know better than that ..I no everyone is big time now a days and Knows better than everyone else right!? come on why would you want to bust my balls because I am making a dime off an investment you don't believe is an investment.I'm sorry if you don't believe me ...maybe your believer is broken?I made a good safe choice that has and is paying off good for me.I can't really go any deeper sorry I guess you win ? I hope thats better.:wink:

10,000 for maintenance is close guess but most of that is a write off anyway?

We've been conditioned to think that buying a house is a good investment, and for a time it was. Real Estate appreciated a pace that exceeded inflation as well as interest rates. This was true for decades after WWII - ask any baby boomer and they'll tell you it paid off for them.

Now, even with low interest rates, and minimal inflation, the housing market appreciation doesn't keep up. Bottom line is that unless you paid cash for a house, and put NOTHING into it, you could do better sitting at blackjack table in Vegas, or playing the stock market.

I know plenty about making money, and I've done a pretty good job of it throughout my career. Its about risk vs. reward. You have to look at ALL the costs involved - not just some of them. You're a plumber, right? There's more to the cost of running your business than the payment on your truck right? There's more to owning a home than the principle and interest payments. Most people don't look at the total cost of ownership when they say buying a home is a "good" investment.

Anyway, paying 180 payments on a 120,000.00 loan (I'm using round numbers here) will cost you almost 180,000 at 5.5%. So, lets assume 0% inflation, you paid all the payments on schedule (no extra principle payments), and all your taxes, repairs and improvements are free, you still only break even.

I'm not trying to bust balls man, but you said it's a lock that you can put $50,000.00 in your pocket. I just want to know how you'd do it. I mean, I'd GLADLY pay someone $120,000.00 today to give me $170,000.00 next week....hell, I'd give them till next year to do it.

[Angrish]

Dude,My fingers are killing me.I guess buying a house is stupid.Should have picked up sum gold!!!!!Everyone wants to rain on my parade:(o'well

I can ride a longer wheelie:p<hahahahaha

[zerocrash]

I can ride a longer wheelie:p<hahahahaha

I can shit a bigger turd, which reminds me.. serious log jam, need help.. bring the good gloves

[Todd#43]

Dude,My fingers are killing me.I guess buying a house is stupid.Should have picked up sum gold!!!!!Everyone wants to rain on my parade:(o'well

I can ride a longer wheelie:p<hahahahaha

I'm not trying to rain on your parade, or bust your balls, or anything like that. You were the one that said you would put 50,000 in your pocket - maybe more - just by purchasing a home. I've shown why its not possible, unless you're putting 50K of borrowed money in your pocket. Why don't you show me how it IS possible?

[Angrish]

I'm not trying to rain on your parade, or bust your balls, or anything like that. You were the one that said you would put 50,000 in your pocket - maybe more - just by purchasing a home. I've shown why its not possible, unless you're putting 50K of borrowed money in your pocket. Why don't you show me how it IS possible?

I don't no what else to tell you ........sorry.I'm going to just agree...your right ,your the man .,um I'm losing my ass You win. Thanks for sharing.

There is that help.

[Todd#43]

I don't no what else to tell you ........sorry.I'm going to just agree...your right ,your the man .,um I'm losing my ass You win. Thanks for sharing.

There is that help.

It has nothing to do with winning or losing. I just thought maybe you'd like to share your story about how anyone can make $50,000.00 in 15 minutes just by buying a house.

If you want to keep it to yourself, that's cool.

[Angrish]

It has nothing to do with winning or losing. I just thought maybe you'd like to share your story about how anyone can make $50,000.00 in 15 minutes just by buying a house.

If you want to keep it to yourself, that's cool.

I will thanks ....15 mins thats a good one:lol:

[Angrish]

I can ride a longer wheelie:p<hahahahaha

I can shit a bigger turd, which reminds me.. serious log jam, need help.. bring the good gloves

You basturd<<<< You know I'm shocked you would say that the jokes are endless!!

[homewrecker]

Difference between renting and owning: Renting you get $0.00 return for the money you have spent. Owning you will at least get some of your money back. That is the only difference. You can try to argue that but it should be simple enough that there is no need to argue.

[Todd#43]

Difference between renting and owning: Renting you get $0.00 return for the money you have spent. Owning you will at least get some of your money back. That is the only difference. You can try to argue that but it should be simple enough that there is no need to argue.

So, you're saying I get nothing for my money?

Christ, that roof over my head, and the toilet I shit in every morning must be a figment of my imagination. Oh yeah, and that hot water heater that went tits up last year must have been replaced by the plumbing fairies because I didnt see a bill for it.

There are NO guarantees that you'll get ANY of your $$ back buying a house. None. ZERO.

Ever look at an amortization table? A $200,000 mortgage at 5% will cost you $284,000.00 in principle and interest only over a 15 year period. Unless you have a modest 3% annual appreciation in the value of your home you'll lose money. Of course, no one pays property taxes, or has to pay for maintenance, upgrades or repairs, all of which add cost to your "investment".

Show me some REAL numbers proving your theory that a house is an investment, and I'll have a listen.

[Dweezel]

wow... I feel much dumber now.

[r1crusher]

I won't take sides here but I see the logic with Todd's statements. Angrish will more than likely push some cash in his pocket, but only when he sells. The uncertainties of the housing sector will obviously play a role in whether or not he gets his $50k. TCO is something that should be taken into account, just because you can buy a $180k home and make the payment doesn't mean you're "home" free. You have to be able to pay for all the other stuff that goes along with home ownership.

Neither is any more right OR wrong, it's simply a matter of personal finance and choice.