Renting vs Buying

[Lightning McQueen]

After buying a house around 12 months ago, I'm beginning to wonder if it was worth it in the end.
When shit goes wrong, I have to pay for it and I probably shouldn't have laid out $70K as a deposit, being a single parent I reckon I'd rather have money at my disposal and a life.
Has anyone else been in a similar predicament?

[The Bedge]

After buying a house around 12 months ago, I'm beginning to wonder if it was worth it in the end.
When shit goes wrong, I have to pay for it and I probably shouldn't have laid out $70K as a deposit, being a single parent I reckon I'd rather have money at my disposal and a life.
Has anyone else been in a similar predicament?

Probably not a footy related discussion

[am Bays]

I thought this was going to be anohter Salary cap thread and further comment on Norwood buying the 2012-14 premierships.

As a Bays fan I'd settle for renting a premiership....

[Booney]

It's a long standing debate that both sides would have +'s and -'s for.

I know people who have rented all their life, have retired on a healthy superannuation sum that they regularly contributed to and have led a comfortable life on mainly one wage. They've never had the headaches of leaking roofs, rusted gutters, dead hotwater services etc etc.

I know people who have 8 properties in their portfolio who regularly "turn over" property by buying, renovating, leasing for 12 months and selling. They go overseas at least twice a year. They probably have about $3-3.5m in assests and about $2-2.5m in debt. They plan to sell a couple upon retirement and one every 4-5 years after that.

Me, I've been a home "owner" for 18 years now and can see the advantages of both, I guess it comes down to the long term vs the short term.

Short term you've got the potential to have extra disposable income ( obviously the mortgage you have vs the rent you pay ) but would you be making sure you invest in your long term future? Super etc.

Long term owning a home should be of benefit, but this will depend upon your ability to ever own the bloody thing!

Good luck deciding!

[Lightning McQueen]

After buying a house around 12 months ago, I'm beginning to wonder if it was worth it in the end.
When shit goes wrong, I have to pay for it and I probably shouldn't have laid out $70K as a deposit, being a single parent I reckon I'd rather have money at my disposal and a life.
Has anyone else been in a similar predicament?

Probably not a footy related discussion

LOL, my net has done some weird shit today.

[Booney]

After buying a house around 12 months ago, I'm beginning to wonder if it was worth it in the end.
When shit goes wrong, I have to pay for it and I probably shouldn't have laid out $70K as a deposit, being a single parent I reckon I'd rather have money at my disposal and a life.
Has anyone else been in a similar predicament?

Probably not a footy related discussion

LOL, my net has done some weird shit today.

Oh dear, net and weird can result in some startling material.

[JK]

I thought this was going to be anohter Salary cap thread and further comment on Norwood buying the 2012-14 premierships.

As a Bays fan I'd settle for renting a premiership....

Prob should settle for just renting the Gatorade tubs at the moment

[Booney]

I thought this was going to be anohter Salary cap thread and further comment on Norwood buying the 2012-14 premierships.

As a Bays fan I'd settle for renting a premiership....

Now, how are going to come up with the bond?

[Lightning McQueen]

It's a long standing debate that both sides would have +'s and -'s for.

I know people who have rented all their life, have retired on a healthy superannuation sum that they regularly contributed to and have led a comfortable life on mainly one wage. They've never had the headaches of leaking roofs, rusted gutters, dead hotwater services etc etc.

I know people who have 8 properties in their portfolio who regularly "turn over" property by buying, renovating, leasing for 12 months and selling. They go overseas at least twice a year. They probably have about $3-3.5m in assests and about $2-2.5m in debt. They plan to sell a couple upon retirement and one every 4-5 years after that.

Me, I've been a home "owner" for 18 years now and can see the advantages of both, I guess it comes down to the long term vs the short term.

Short term you've got the potential to have extra disposable income ( obviously the mortgage you have vs the rent you pay ) but would you be making sure you invest in your long term future? Super etc.

Long term owning a home should be of benefit, but this will depend upon your ability to ever own the bloody thing!

Good luck deciding!

I've been a home owner for most of my adult life, when I separated I sold and then re-bought but obviously on a single income.
Doing the maths, I can see why I'm going through money so rapidly as 80% of my pay is already accounted for and I get paid monthly, I have pondered working back out in the factory and cashing in on all the overtime but it's split shifts and my kids are too young to be left alone at home.

We survive, it's just the unexpected things that pop up, my daughter has a state cricket tournament in January for 9 days now plus a volleyball tournament in Melbourne during December that will bear decent costs, my son is now hitting the age where there's representative opportunities coming up too so it's a bit daunting.

It will be easier when it's just me that I have to worry about.

[Q.]

I love renting and living wherever is convenient or fun to suit the particular point in my life.

[Corona Man]

It's a long standing debate that both sides would have +'s and -'s for.

I know people who have rented all their life, have retired on a healthy superannuation sum that they regularly contributed to and have led a comfortable life on mainly one wage. They've never had the headaches of leaking roofs, rusted gutters, dead hotwater services etc etc.

I know people who have 8 properties in their portfolio who regularly "turn over" property by buying, renovating, leasing for 12 months and selling. They go overseas at least twice a year. They probably have about $3-3.5m in assests and about $2-2.5m in debt. They plan to sell a couple upon retirement and one every 4-5 years after that.

Me, I've been a home "owner" for 18 years now and can see the advantages of both, I guess it comes down to the long term vs the short term.

Short term you've got the potential to have extra disposable income ( obviously the mortgage you have vs the rent you pay ) but would you be making sure you invest in your long term future? Super etc.

Long term owning a home should be of benefit, but this will depend upon your ability to ever own the bloody thing!

Good luck deciding!

I've been a home owner for most of my adult life, when I separated I sold and then re-bought but obviously on a single income.
Doing the maths, I can see why I'm going through money so rapidly as 80% of my pay is already accounted for and I get paid monthly, I have pondered working back out in the factory and cashing in on all the overtime but it's split shifts and my kids are too young to be left alone at home.

We survive, it's just the unexpected things that pop up, my daughter has a state cricket tournament in January for 9 days now plus a volleyball tournament in Melbourne during December that will bear decent costs, my son is now hitting the age where there's representative opportunities coming up too so it's a bit daunting.

It will be easier when it's just me that I have to worry about.

I don't envy your position. It would be incredibly difficult on a single income to get by, let alone allow your kids to chase the opportunities you have outlined above.

I have always been one to buy over renting. In my younger days, I took every bit of overtime I could to reduce the principal of my home loan, and therefore reduce the interest. 20 years ago I was all but "freehold".... Then we decided to upgrade to a bigger place, and took out a larger mortgage.

Around that time my attitude changed a bit. I was no longer in such a hurry to reduce the principal. Partly due to interest rates being what they are now, as opposed to 17.5% when I first jumped on the home ownership "merry-go-round". I also got my head around the "ownership" part. I didn't care if I never owed the home we live in outright. It became about the capital investment. My mortgage is fairly small, compared to the home value, so we are comfortable, and we can "live" a little.

My 2 cents - for what it's worth is to hang in on owning rather than renting while interest rates are what they are. If you can get by, do so. I would suggest a move back onto the factory floor to chase overtime may not be the way to go. Are there opportunities for you to move "up" where you are, to command a higher wage?

[Lightning McQueen]

Pretty much on the mark there C-Man, if I keep my mouth shut and continue my good work the opportunities for big coin could present themselves.

I too "had", a small mortgage compared to house value with my old house and sold it for about $40K less than I could have as I wanted a quick sale and needed to break all ties with my ex, I don't live a life of regret but I need to weigh up wheat is the best option for me at this point of time.

[Wedgie]

Rented to 99, bought a house for $95K in 1999 that is now worth $350k and started renting again 6 months ago after living in the house I owned for 17 years and living as a boarder for 2 years.
When people ask me what I'd do if I had my time again I'd never buy. Renting is so much more stress free. If a hot water system goes you don't need to find 1K in a hurry, if termites go through your house you don't need to find 10K in a hurry, if the bathrooms start to get a bit ratty you don't need to fork out 15K for rennos. Rates, maintenance, etc etc. Buying a house wasn't the great Australian dream for me, it was a nightmare.
I still part own a house on which I have to pay no upkeep on but wish I didn't but am lucky.
Having said all that, I'm very "unhandy". I tend to break things better than I can fix them.
It's a horse's for courses thing, if you're a tradie who can build walls, Reno's, etc and can get in the market at the right time then it's probably worth buying.
But me personally? Stoked I'm renting and would never buy again and that's not really taking rent/mortgage into account as I pay more renting than I did when paying off my mortgage (live close to town in a nice area).

[Corona Man]

Pretty much on the mark there C-Man, if I keep my mouth shut and continue my good work the opportunities for big coin could present themselves.

I too "had", a small mortgage compared to house value with my old house and sold it for about $40K less than I could have as I wanted a quick sale and needed to break all ties with my ex, I don't live a life of regret but I need to weigh up wheat is the best option for me at this point of time.

No point looking backwards... always look forwards. Next opportunity, all that stuff. As far as your kids go, sounds like there is some sporting talent there. Talent wins every time. In some ways a "tough" child-hood, not having every thing handed to them will make them better in the long run as well. Had a kid I coached in cricket, good player (bowler), money for his family was tight. Kid made the state under 15's, went to the nationals. Couldn't afford a decent bat. Didn't want to look like a "dick" if he got a hit. We (grass roots club) made sure the kid had a decent bat to go away with. Not suggesting that's the case for you... but people recognise talent, and want to see it flourish.

Don't sweat the small stuff.

[Psyber]

I've done quite nicely out of buying a house, living in it for a while, then selling and upgrading.
Sure the agents take a chop, but you can negotiate that percentage, and you just need to get the timing right.
(Sell at market peak and buy when it settles back, or once you have enough capital buy the new one and wait to sell the old one until the next peak.)

First house bought when I was 25, in 1969 cost $10800, and sold in late 1971 for $14950.
Second in 1971 $16900 to buy land and build, sold in 1976 for $45000.

Most recent example - house in Olinda, Victoria, cost $635000 in late 2003, well under the advertised price ($690K+), and sold in late 2008 for $800000.
In 2009 I bought present house in the Stirling region for $535000 - $10K under council valuation - no plan to sell at this stage.

So, I'd say take the long-term view and buy not rent.
I wish now I'd spent less on sports cars and more on extra property...
(Though it was fun!)

[gossipgirl]

what about selling of airplanes and helicopters ?

[Lightning McQueen]

Pretty much on the mark there C-Man, if I keep my mouth shut and continue my good work the opportunities for big coin could present themselves.

I too "had", a small mortgage compared to house value with my old house and sold it for about $40K less than I could have as I wanted a quick sale and needed to break all ties with my ex, I don't live a life of regret but I need to weigh up wheat is the best option for me at this point of time.

No point looking backwards... always look forwards. Next opportunity, all that stuff. As far as your kids go, sounds like there is some sporting talent there. Talent wins every time. In some ways a "tough" child-hood, not having every thing handed to them will make them better in the long run as well. Had a kid I coached in cricket, good player (bowler), money for his family was tight. Kid made the state under 15's, went to the nationals. Couldn't afford a decent bat. Didn't want to look like a "dick" if he got a hit. We (grass roots club) made sure the kid had a decent bat to go away with. Not suggesting that's the case for you... but people recognise talent, and want to see it flourish.

Don't sweat the small stuff.

Yeah mate, there's always the feel good kid in the squad etc. but I'd rather my kids not be that person, we're not destitute and being a home owner is a luxury.
Whether I own now or rent it's not going to change my life too much, Ill still be happy, my bank balance will be a bit different though.

[Lightning McQueen]

I've done quite nicely out of buying a house, living in it for a while, then selling and upgrading.
Sure the agents take a chop, but you can negotiate that percentage, and you just need to get the timing right.
(Sell at market peak and buy when it settles back, or once you have enough capital buy the new one and wait to sell the old one until the next peak.)

First house bought when I was 25, in 1969 cost $10800, and sold in late 1971 for $14950.
Second in 1971 $16900 to buy land and build, sold in 1976 for $45000.

Most recent example - house in Olinda, Victoria, cost $635000 in late 2003, well under the advertised price ($690K+), and sold in late 2008 for $800000.
In 2009 I bought present house in the Stirling region for $535000 - $10K under council valuation - no plan to sell at this stage.

So, I'd say take the long-term view and buy not rent.
I wish now I'd spent less on sports cars and more on extra property...
(Though it was fun!)

I don't want fancy things mate, just a roof over our heads and a happy place to call home.

[Booney]

I don't want fancy things mate, just a roof over our heads and a happy place to call home.

An admirable life goal.

[RooShootOhh]

I think of it similar to a work car vs a car allowance...

A work provided car is the same as renting, set package, no hidden costs, no unplanned extra's, nearly 100% hassle free - But when its done, you walk away with nothing!

A Car Allowance is like buying, sometimes works out a little cheaper per month, but may incur some unplanned costs along the way that you have to fork out, however, when its done it's yours.

This is where it comes down to planning and choice, if you can put away the same amount each week, but there's obviously a little left over in the buying example, that little bit should cover any unexpected issues that arise, and if none do over a year, consider it a saving plan.


In the car example I look at it this way.... If work are going to spend $20k per year on a car for me (either through their own fleet with costs or pay me an allowance), would I like to walk away from the company in 5 years time empty handed, or with a car thats mine as a parting gift... pretty simple answer IMO provided the take home pay doesn't actually change.

And I reckon the same goes for buying/renting... If your going to (and can afford to) spend $X every month on one of either rent or mortgage, would rather end up with nothing in your possession in 20 years or end up with a house that's yours???

The other option is to do both.

Lightning, if your struggling with your own place, why don't you rent it out, making sure rental price covers mortgage plus a little extra in case you need to get something fixed, and then go and rent something yourself and a cheaper price point. Then you actually are saving money in your pocket each week and still end up with a house in 20 years???