why people want to own property, rather then rent for ever ?

Question

assuming u dont plan children, and u dont get excited about the idea of having your own home in 30 years when u r too old for most things anyway, why would u bother with mortgage hassle?

i know we r conditioned to own, but what for ???

anyway investing in funds etc is more flexible and more hassle-free if u have to allocate cash somewhere...no ?

Answer 1

Apart from the fact that my mortgage payment is much less than I would pay for an apartment, and it's good for your credit it you own & make payments on time, there is the tax deduction of mortgage interest. That's the only reason for most of the people like the ones you mention. And yes, owning a home is part of the "American Dream", whatever that is nowadays. Personally, I'd rather rent if I could afford it - less hassle with yardwork and maintenance.

I'd never borrow against my equity (which is 50% of the home's value). That's how people lose their homes. It's a real gamble, putting your house up as collateral.

Answer 2

An investment in a home can be approached like any other investment, by looking at the costs and benefits of the transaction. The benefit that many people see in purchasing a home is that the money that you have to pay for housing "goes somewhere." You acquire equity in the home you have purchased. In this sense, having your own home is like an investment. You have to pay for housing, so why not make this housing payment an investment. Yes, investing in funds or other avenues would be more liquid, but it really isn't a choice of one or the other, because you are still paying rent. Home values over time typically rise, so you will make a return on your investment. Many people also do not stay in their home until the mortgage is paid off, so you are not necessarily tied to the same home for 15 years or 30 years. Renting has its benefits too. As a homeowner, you have to conduct whatever maintainance on your home. If you are rather nomadic, moving from location to location, an apartment may suit you better for the time being as it is far easier to break a lease than to quickly sell a house.

Answer 3

Owning property is an investment and, while you don't have flexibility to reallocate the money invested in the property, renting uses more or your funds than a mortgage, taxes, and insurance so you have more money overall to invest. Also, the money you pay in rent goes toward nothing of value to you.

Let's look at an example. Let's assume that rent on a four bedroom house where I live is $2000 per month. A mortgage (100% loan-to-value, so there is no down payment), taxes, and insurance on the same house is $1800 per month. Of that $1800, $1600 is insurance, principle and interest on the mortgage, $150 is taxes, and $50 is homeowners insurance. Also, let's assume that $1400 per month of the mortagage insurance, principle, and interest goes to mortgage insurance and interest, and $200 goes to the principle of the loan. In this example, if I were renting and wanted to invest $400, I would need to spend $2400 ($2000 for the rent and $400 for my investments). If I were a property owner, I would need to spend $2000 (the same as the rent payment). The $2000 dollars is made up of $1600 of mortgage insurance, interest, and property insurance, $200 invested in the property (the pay down of the loan principle) and $200 invested out of my pocket. Or, put another way, for the same $2400 per month spent to rent and invest $400, I have doubled the amount of money I can invest to $800 per month if I own the same property.

May God bless and keep you.

Answer 4

Well, I rent and personally I don't particularly like it. I hate the fact that my money is just going no where every month. If I had a mortgage then I would be slowly buying my house and would have something at the end. Unfortunately though, I don't have the cash for a deposit at the moment and have got too many existing debts to get one (for a half decent house anyway, I don't wanna live in a box in a bad area). The government should do more to get 1st time buyers on the ladder instead of feeding the 16 year old baby producers.

Answer 5

Tax deduction on mortgage interest
Part of your Mortgage payment goes to ownership (stays in your pocket) while 100% of rent is paid to someone else
Realized equity over time often out does better than the stock market and you don't have to pay capital gains tax on it (if owned for 5 years)

Home ownership is simply a different kind of investment. Granted it is not as liquid as a fund, but still a competitive investment on the short and long term depending upon where you live. Rather than bore you with equations proving this point or poetic definitions of "Pride In Ownership", you are forgetting someone has to be the landlord and if you are your own landlord, you have more control over your domain than you do as a renter. If that is conditioning to own, so be it!

Answer 6

Well, this is how it works. I used to rent an apartment for about the same cost as my mortgage. Over the 4 years in the apartment, I paid $30,000 in rent. What did I get for that? Just a place to live. I now own my house. I'll pay $30,000 over 4 years, and I'll have nearly $50,000 in equity that means I have more money later on, instead of just wasted money. Funds are much more risky and have a better chance at value loss than a house. A house over time will always gain in value. It may not gain a lot, but it will gain.

Answer 7

I see where you're coming from, but owning your own home means you're the boss, not someone else. As a renter, you have no say and you're under someones thumb. You sound like you're not one for being controlled, but as a renter you're the puppet and the one renting you the place holds the strings.

Owning a home means you have acquired something of value which belongs to you, something you worked for. Why waste your money and pay someone elses mortgage while you could be paying your own. You wouldn't always go to a restaurant and pay for everyone elses meals and only have a spoonful and be content. So why do that with you're living arrangements.

If you can, buy a house. You'll be happy you did. Plus girls/ guys love it when you own your own place, it shows accomplishment and dedication.

God Bless
T

Answer 8

I very own my residing house outright. I in no way back ought to difficulty approximately being placed out into the line if my income isn't sufficient (the darkish possibly, yet not the line). i don't have little ones, or plan for any. What I do have is a few pets. No regulations approximately length or form of pets once you very own. in case you become bored of finding on the carpet or the kitchen cabinets, you're unfastened to alter them in case you may handle to pay for to. once you lease, the only way you get new is whilst your previous is so broken that it rather is going to not be able to be fixed one extra time. Then your landlord replaces with what's reasonable, not what could be attractive on your eye. Now that I now not have housing fee, I somewhat have some funds obtainable to take a place/save. once I had lease or own loan to pay each and each month I slightly had sufficient to purchase foodstuff. that's an extremely own determination that folk make. some human beings want the sensation of protection featuring residing house possession. Others choose the sensation of freedom that renting can provide. what's perfect for one guy or woman won't be superb suited for yet another.

Answer 9

When you buy you build equity. Why pay interest and build equity for someone else? Since property values historically increase, the equity will increase by the amount the property value goes up as well. This can build into a pretty good nest egg for retirement. Real estate is generally a good investment and usually you pay less in the long run than renting.

Answer 10

i think pride does have a lot to do with it, a sense of accomplishment. but owning a house, or land is also much more feasible than having thousands tied up in bonds and such. a property is concrete evidence of financial security, while papers with columns of figures on them are so ambiguous, and subject to fluctuations, and even drastic change. for instance, in 1929, when the market crashed, people who did not own any land or real estate became beggars, no matter how much money they had invested.
In some countries, ownership of a plot of land, a cow, a pig, is the difference between life and death for your family. As humans, we have a built in instinct to live off what the land gives us, which is probably why people find so much security in knowing that they have complete ownership of part of the world and therefor access to it's resources (shelter, lumber, a place to grow food, etc...)
"A man without land is nobody."
- The Apprenticeship of Duddy Kravitz, by Mordechai Richler