Thread for those that have their money down.

[zimm]

Neither is a $1,000/month to 2,000/month rent payment that goes down the drain wherever you move!

The issue being, human behavior isn't factored into the equation.

Within an income demographic, the conscious renter dies with more wealth.

The reason is behavior.

People buy houses because they want their OWN place. They want pools. They picture kids. The picture entertaining. They picture space. They want living rooms, parlors and dens in the same house. So what happens in practice, is people consistently purchase and pay for way more than they need, and do so over a longer period of time. Freestanding properties are inefficient, and maintenance intensive. the 4 bedroom you own for 40 years with only two kids sits empty and cost money for 20 of them. 30 year mortgage tables don't favor you until later in the loan making frequent moves prohibative.

Meanwhile, The guy sitting next to you pulling the same salary that rented, only rented what he needed, when he needed it, and the efficiency savings went into compounding investments.

It's kinda why I get a kick out of the "overestimation" of real estate in inherited wealth theory when the racial wealth gap is discussed. There are many reasons, but real estate in most cases is a drag. It could have been even more pronounced. Using a house to build wealth is as efficient as a whole life insurance policy. Yea, there is a lump sum left over, but it's nowhere near what would be there if people knew how to invest, and didnt spend money on stupid crap like grenadiers.

 

[plainjaneFJC]

If you can buck the trends- live in less of a house than you can afford- then let others pay you those monthly rents checks.. well it makes owning pretty appealing at that point.

 

[zimm]

If you can buck the trends- live in less of a house than you can afford- then let others pay you those monthly rents checks.. well it makes owning pretty appealing at that point.

Theory vs practice.

I live my life like one day, I will be dead. I bet I’ll be right as usual. I already told the spawn they better work hard. Im philosophically opposed to inheritance, so I’ll be burning thru it to protect them from sloth and other such sins. I’m taking the bullet for them.

 

[plainjaneFJC]

Theory vs practice.

I live my life like one day, I will be dead. I bet I’ll be right as usual. I already told the spawn they better work hard. Im philosophically opposed to inheritance, so I’ll be burning thru it to protect them from sloth and other such sins. I’m taking the bullet for them.

lol I can see it from both sides for sure. I know my parents won’t leave me a dime and I’m totally fine with that. I personally aiming for Proverbs 13:22- but who knows…

 

[nickw]

If you can buck the trends- live in less of a house than you can afford- then let others pay you those monthly rents checks.. well it makes owning pretty appealing at that point.

I thought I liked the idea of owning and renting out a house but I've had two buddies that have damn near lost their butts on rentals/renters that destroyed homes and refused to pay....both way underwater on their rentals and a constant source of stress.

 

[plainjaneFJC]

I thought I liked the idea of owning and renting out a house but I've had two buddies that have damn near lost their butts on rentals/renters that destroyed homes and refused to pay....both way underwater on their rentals and a constant source of stress.

I’ve got 3- haven’t been stiffed a dime yet. A few rules I use:
1.Never rent a house you wouldn’t be willing to live in yourself, this includes the neighborhood.
2. Being extremely picky on who you rent to. I vet everyone, I tell more people no than yes.

Fortunately mine are paid for so if someone stiffs me it’ll suck but I ain’t losing any sleep over it.

 

[zimm]

I’ve got 3- haven’t been stiffed a dime yet. A few rules I use:
1.Never rent a house you wouldn’t be willing to live in yourself, this includes the neighborhood.
2. Being extremely picky on who you rent to. I vet everyone, I tell more people no than yes.

Fortunately mine are paid for so if someone stiffs me it’ll suck but I ain’t losing any sleep over it.

I buy mine cash. That way I'm not irritated when time goes by and I'm stroking a payment and there's no renter.

I'm also below market, which keep people thankful. They don't destroy ******** and they generally give good references when they move out. When someone does an improvement, I deduct rent without them asking. "do unto otheres.. " is a good life rule for anyone. The very worst renter I had was my nephew. He moved into a freshly revamped house at 2/3 market, I gave a month free when he went to hawaii with his boyfreind and came back broke, fixed the appliances they somehow broke, including a toilet that had its mounting bolts snapped, (I DO NOT want to know what was going on to cause that), and then he started to send me texts one night that I'm slum lord and he was gonna sue me (recent law school attendee) because there was leaking in a bathroom window... It turn out he takes 1/2 hour showers without the fan on and it was -10 outside. I changed the locks without notice and sent pics of his hidden hash lab to the family and reminded him I hang with varius state law enforcemnt agents and I'm one text away from ending his future career. It caused rift in the family when I told his grandmother if he was at any holiday festivities I'd give the little ********** a reason to sue me by beating him senceless and tossing his limp body off the porch. I was tad hot. I'm better now.

 

[plainjaneFJC]

Lol

 

[nickw]

I’ve got 3- haven’t been stiffed a dime yet. A few rules I use:
1.Never rent a house you wouldn’t be willing to live in yourself, this includes the neighborhood.
2. Being extremely picky on who you rent to. I vet everyone, I tell more people no than yes.

Fortunately mine are paid for so if someone stiffs me it’ll suck but I ain’t losing any sleep over it.

Point #1 is interesting and I agree, it's probably the right call and effectively sets a bar of reasonableness....not sure that would pencil out here in the West....

Point #2 is tough unless you are managing yourself, my experience with a rental we had short term was we set criteria up front; price, credit score, animals, family, etc. and the agency found / vetted candidates and I got to make final selections but don't get to interview directly. No problems with my renters, only a year or so, which is why I wanted the safety net of a property manager but that was the difference between us making money and cutting even.