Thread: Rent vs Buying

I know alot of people say renting is throwing your money away, but do you not see any advantages ?

Using what little I know about LA as example:

• 1. You pay X per month, and I assume this includes all taxes and amneties. So you always know where you stand.
  2. Flexibility, after your agreed term is up, you can swap properties without needing a mortagage etc.
  3. When your renting, you can pay for example $50k a month ($600k per YEAR) for a top of the range $11mill house. If your actually a millionare, this means you have $xmillion sitting in the bank for investments, if sucessfull would cover your rent anyway.
  4. Using my previous example, after 10 years of living at the same $11mill house, you have only "thrown away" $6mill USD, which is just over half what its worth. Its unlikely you will want to live there after 10 years anyway, hence more flexibility.

Thoughts ?

Ummmm, because that would be 6 million dollars gone without gaining an asset... this is basic economics

You still wouldnt have gained the asset as its $11mill USD not $6mill USD. Yet you would be able to live in it for 10 years, just like you would if you bought it.

Plus what do you do with the $6mill you have if the first place...invest it...gain more assets ?

Originally Posted by crgray

Ummmm, because that would be 6 million dollars gone without gaining an asset... this is basic economics

what if the value of said house goes down? leverage works both ways.

- chuck

but you would have some security

I will not buy a house until I am 100% certain that I will be living in an area for over 4 years. But I am a very mobile person, so purchase is not a good option for me.

. . . and I have no problem staying on peoples couches and living with parents if that is necessary.

Nick

Originally Posted by carendt242

what if the value of said house goes down? leverage works both ways.

- chuck

still have some value where as renting gets you zilch.

The condo I am living in temporarily for school. I bought. The payments are cheaper than rent would have been, and when i finish i can rent it for income or sell.

Your answer is here.

edit: wrong section, my bad.

A car is a bit different to a house though isnt it!

A car will always depreciate (unless its a classic or rare) for starters, and much more likely to be damaged accidentally.