- Move to a better paying job easily. You make instantly more money.
- Move to a cheaper place when times get tough. This gives security because your life is flexible and can adapt to the ever changing life.
- Change the space if you get a wife, kids, a dog, a parking space, or if they leave you. Well, the parking might stay.
- Leave if a neighbor becomes invasive, if they build a supermarket under your windows, if water gets contaminated...
- Get closer to your job so that you save time, energy and transport money.
- In case of divorce, you don't have to share anything.
- The gap between rent money and mortgage payment money can be used for anything. Sometime you can invest it. Sometime you can buy a gift or holidays. Sometimes it saves your ass for tough days.
Selling a house is hard. It cost money, time, energy, and you still have your loan running after that if you didn't negotiated early repayment. Plus, good luck getting a new loan to buy the next place if you are still paying the first one.
A house is a lot lock in, for the money it provides.
I agree a house is a lot lock in, but there are many other nuanced pros and cons to home ownership.
- Homeowners can modify their dwelling. Renovations, painting, etc.
- Banks lend millions of dollars to ordinary people through mortgages. Subsequent loans can also be taken out against existing properties. This enables enormous leverage, with commensurate risk. A good way to get rich (or lose it all).
- Homeowners can be confident in their cost of living staying static long term, whereas rent typically increases every year. Decades later this can mean an initially pricey mortgage payment looks cheap compared to renting.
- Renters have the risk of being forced to move at the whim the landlord. Usually there are some protections like minimum notice periods and laws against arbitrary evictions, but there's always some chance whereas homeowners can stay put for generations provided they pay their continue to pay their mortgage and property taxes.
Yeah, it turns out you need to put something on the line to have a huge reward.
To me, home equity is a game changer for this discussion. the ability to open a HELOC and have access to a massive amount of capital is a gateway to real wealth thru various investment vehicles - not the least of which is investing in further real estate.. which will accumulate more equity itself etc..
- Move to a better paying job easily. You make instantly more money.
- Move to a cheaper place when times get tough. This gives security because your life is flexible and can adapt to the ever changing life.
- Change the space if you get a wife, kids, a dog, a parking space, or if they leave you. Well, the parking might stay.
- Leave if a neighbor becomes invasive, if they build a supermarket under your windows, if water gets contaminated...
- Get closer to your job so that you save time, energy and transport money.
- In case of divorce, you don't have to share anything.
- The gap between rent money and mortgage payment money can be used for anything. Sometime you can invest it. Sometime you can buy a gift or holidays. Sometimes it saves your ass for tough days.
Selling a house is hard. It cost money, time, energy, and you still have your loan running after that if you didn't negotiated early repayment. Plus, good luck getting a new loan to buy the next place if you are still paying the first one.
A house is a lot lock in, for the money it provides.