Quote:
Originally Posted by amazinmets73
I've been told by every real estate investor that rent is burning money. Anyone who can dissuade me? Keep in mind I don't intend on getting married or having kids.
Well, of course they say that!
What they like to focus on is that by buying instead of paying your rent money to someone else you are 'paying yourself'. Your mortgage payment just builds equity that you can turn around and sell to get your money back. Sounds pretty awesome, right?
What they don't say is that a good chunk of your mortgage is going towards interest costs which go to someone else just like rent. Owning a property has costs like property tax and maintenance that aren't equivalent to renting. If your house goes down in value that 'equity' you built disappears. The extra money you're spending on a house could be invested in other things that return a better rate. And so on.
My wife and I like owning a house. I'm pretty sure right now that renting would be a bit smarter financially than owning - but we like that its our place and that comes with a bunch of benefits. I also hate moving, so by buying a house you have a lot more control over how long you stay there.