
The “rent vs. buy” dilemma (2018) - simonebrunozzi
https://medium.com/fabrica/the-rent-versus-buy-dilemma-12-important-questions-5f5a7d1815f
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dev_dull
> _However, most people don’t think this through, especially if they want to
> buy, in which case ~10% of your home value is spent on the transaction_

This is really not true, at least not in high-demand areas. First of all the
seller pays the fees typically, and they are much lower. Redfin for example
costs you 1% in the Bay Area. If your agent is telling you it will be 10% then
you’re being taken for a ride.

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simonebrunozzi
I've spoken with tens of real estate experts in 2017 and 2018, and everybody
pretty much agreed that the transaction costs generally approach or even
surpass 10%.

There's much more than just agent fees to include in these costs. Title
insurance. Closing. Mortgage origination fees. Etc.

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milkytron
Just bought a home half a year ago, fees came out to nowhere near 10%. It was
just around 2% that came from my pocket, and the seller paid the rest, but
even then I doubt they paid 8% to get that 10% figure they're suggesting.

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csolorio
I negotiated the purchase of my condo from our landlord. The first thing we
did was shave 6% off from the avg price in the area due to not using real
estate agents. That fee is an indirect amount you paid through an increased
price.

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ThrustVectoring
A big factor people miss is that many real estate markets and labor markets
are heavily correlated. There's often a few major employers or a few
productive sectors that write paychecks in the area, which then drives rental
and housing prices in the area. So, housing is often an asset with a large
positive correlation with your future wages. There's good historical examples
here - Detroit around 2008 had simultaneous drops in real estate prices and
automotive sector employment.

