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Renting verus home ownership for older folks

BigAl

Gone But Not Forgotten
SUPER Site Supporter
OK . The American dream is to own your own home someday . But is it really best for the older senior generation ? I am beginning to reevaluate this idea .

With home ownership comes repair & upkeep expenses , Property taxes , and the rise and fall of property values .
It also locks you into staying in one place longer than most folks care to .
I have 3 homes scattered about . One in California , Idaho and Panama . Its keeps me busy keeping all 3 up and ready . I have decided to sale 2 and downsize .Maybe all of them
Now I am looking at other investments and realize that unless you have a good Crystal Ball to look into , homes can drag you down .
Are you getting a 6-8% return on your home every year ? Is it easily obtainable with cash if you kknow where to look ?

Homes cannot be sold overnight . It takes some time and then you pay 6% to sale it .
I Now believe that No home ownership may be the best way to go . Someone else pays the property tax and does the upkeep . I just pay one price for rent . If I like it I can always go for a long term lease and lock the rent price for a year or two .

If you own your own home you can also forget about long term care in a rest home with any financial assistance help from good old Uncle Sam, if you should ever need it . They believe if you own a home you can afford the cost of a rest home . The average cost is over 10 grand a month now . They don't give a shit if you have $1 in your bank account or a million . You own a home so thats good enough for them to deny you help .
Now what do you do with that harded earned money that you save by not buying ???? Invest wisely .
My plan is to start spreading (give away ) my funds around to my family as I get older . No one says I can't buy a new truck or car and forget where I left it . Same with groceries , light bill and everyday needs that they might have.

If the goverment comes knockin on my door and ask what I do with my money , i'll just tell em the kids are lazy SOBs and that they are always wantin something ?? I can also say I hear the hookers in town are having a two for one special and that I am horny a lot !!!!!:clap:

I have not got all the answers , but I am working on it :unsure:
 

REDDOGTWO

Unemployed Veg. Peddler
SUPER Site Supporter
The problem with rent is that it fluctuates. Here in town where a two bedroom apartment rented for under six hundred about three years back it is now over 900.
 

grizzer

New member
Be careful on the giveaways as Medicaid has a 60 month clawback. Relatives may not be happy giving back houses/cars & groceries.

Fed and State gift taxes may kick in at different dollar values as well. Might get friendly with form 709...
 

NorthernRedneck

Well-known member
GOLD Site Supporter
The thing with renting is that generally speaking, you pay more each month to rent a place than what it would cost to own. Up here, a two bedroom house in the city is renting for $1350+ utilities a month. We bought a 4 bedroom house for 1050 all in. And at the end of 20+ years, we'll have something to show for the money we put down. After 20+ yrs of renting, a person won't have equity to show for their investment. And they will have paid more to rent than to buy.

I'm a landlord. Right now, for my small house, I'm still paying a mortgage on it but by renting it out, I'm making $150 per month. It's not much but the place takes care of itself and there's a small profit at the end. Now, I've owned it since 99. The house will be completely paid for in 4 yrs. Then, I will either continue renting it or sell it and have clear cash sitting there to invest elsewhere. I plan on using the house as part of my children's education fund. I wouldn't be able to do that by renting.
 

JEV

Mr. Congeniality
GOLD Site Supporter
I still like the ownership aspect, but I certainly don't need 2,600 sq. ft., 4 bedrooms, 3 baths plus a 1300 sq ft basement any longer. Space fills based on the amount available, and we have lots of empty and unused space since the three kids moved out and we started cleaning out their remaining shit. Starting to look at options for when me and Mama officially retire in a few years, and they don't include staying in this big ass house.

I don't like the restrictions placed on owners in these fancy shmantsy developments and condos. The people think their shit don't stink and want every unit to look the same. Some joints won't even let you have a kid's swing set outside because the rich bastards don't want to see or hear kids. Being a ham radio guy, the tower and an antenna array is a no-no in virtually every one of those cloistered dumps.

My house is paid for, so I'm in no rush to get into another house. I won't have a mortgage on the next one either, as it will be much smaller.
 

NorthernRedneck

Well-known member
GOLD Site Supporter
I can see when you get old and grouchy how the idea of home ownership may change though. The thought of sitting in a retirement home as a grouchy old man slapping young nurses in the butt as they come in to change your depends could be appealing to some...:whistling:
 

bczoom

Super Moderator
Staff member
GOLD Site Supporter
As grizzer noted, watch anything given away. There's limits per year on what you can do. Check with your tax preparer and financial adviser.

Instead of a assisted living facility for $10K per month, hop on a cruise ship which is about $3K per month. Food, medical, housekeeping... is all included.
 

EastTexFrank

Well-known member
GOLD Site Supporter
You know Al, this has been something that has been worrying me for the last couple of years and I only have one home, not three. I love where I live and have no intention of moving, except to the graveyard, but I have a large chunk of cash tied up in it that's not doing me any good. You can call it an investment but it's not really unless you sell it and realize your profit. As it stands, the only people who will benefit from it are my beneficiaries when I'm gone and it'll just be more icing on the cake as far as they are concerned.

I probably need to look into this Reverse Mortgage thing and find out if that could be a benefit to us. Does anyone know anything about them? (Not meaning to steal Al's thread but it could also be a benefit to him).
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
I probably need to look into this Reverse Mortgage thing and find out if that could be a benefit to us. Does anyone know anything about them? (Not meaning to steal Al's thread but it could also be a benefit to him).

Please do ! I think this is good information a lot of older folks may be interested in . It all ties together . Never thought about reverse mortgage???????.
I do know there is a limit to how much you can give away to relatives each year . It use to be $10K a year I believe . I still think buying a car or truck for them and just forgetting where i left it would help spread it around a little . I'll just call them my little chauffers!! I could also make legal loans to them and forget to collect the payments . I would then charge them $1 a year for a "Pay Off insurance plan" in case I die , where in their loan would be covered and paid off so they owned nothing to the estate .:biggrin:
 

FrancSevin

Proudly Deplorable
GOLD Site Supporter
Peoplein Europe prefer to rent over ownership. That's enough proof for me that is is as backwards.

Nothing is better or easier for the average Joe to improved value for investmet that a single family home. He has to live somewhere, and all things being equal it usualy costs the same to rent per month as to own. But that is for the one dwelling.

But not against three homes in three parts of the world. Now you are not getting enough use for the money you invest every month. At least not enough to compensate for the loss of other investment opportunities.

Real estate has always been the best and surest way to economic freedom. Buy it wrong however, and it can lead to ruin. Buy more than you can manage will also lead to ruin.

While renting may take the risk out of real estate it certainly garrantees absolutley no return on the investment. So unless you have a good investment plan for the money you think you might be saving every month by renting, and stick religiously to it, you will gain nothing.

The only reasons to rent would be that you cannot put down enough capital or you do not wish to put down roots. No down, or low down, payment puts you upsiide down for most of the loan term. And buying and selling short term costs realtor fees beyond any equity gains. Even a club footed chump from the Ozarks can do that math.
 

Snowtrac Nome

member formerly known as dds
GOLD Site Supporter
Please do ! I think this is good information a lot of older folks may be interested in . It all ties together . Never thought about reverse mortgage???????.
I do know there is a limit to how much you can give away to relatives each year . It use to be $10K a year I believe . I still think buying a car or truck for them and just forgetting where i left it would help spread it around a little . I'll just call them my little chauffers!! I could also make legal loans to them and forget to collect the payments . I would then charge them $1 a year for a "Pay Off insurance plan" in case I die , where in their loan would be covered and paid off so they owned nothing to the estate .:biggrin:

Gee Allen you sound like an awful nice Dad. Can I be an adopted child of yours.
 

luvs

'lil yinzer~
GOLD Site Supporter
my elders own- my Parents, etc. they payed too much.
i'm not older. i'm wise, though, say my elders.

that being said, i rent. thus, i can relocate, if need be, sans too much melodrama & time. also, i'm 1 person in a spacious place. they maintain on their own. (& i'm situated in a few-mile radius of many places to be, if i bide my time efficiently.) then again, location matters.
 

AAUTOFAB1

Bronze Member
SUPER Site Supporter
it seems a lot of people here in the USA are rethinking how to deal with estate planing, more and more fairly wealthy people are cutting back on dwelling size and investing more cautiously. have you thought of setting up a trust? if set up wisely, it could bee what your looking for:unsure:
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
Peoplein Europe prefer to rent over ownership. That's enough proof for me that is is as backwards.

Nothing is better or easier for the average Joe to improved value for investmet that a single family home. He has to live somewhere, and all things being equal it usualy costs the same to rent per month as to own. But that is for the one dwelling.

Maybe ,,, But what happens when to have a beautiful place valued at $750K plus and some Piece of Shit moves in on the next parcel and builds a POS house, starts putting up tin sided out buildings that a monkey could build better and then brings in 11 rusting cars and trucks to park around the place ??? That kinda sucks the old value right out of anything around it . Believe me it does happen often . The guys a retired fat ass cop who thinks he is above the law ,,, any law . He has made it clear , you turn him into the county nothing will be done and he will get even . I ought to know , he once lived next door to me .

As far as your comparison to Europe folks renting so it must be a bad idea, :doh: that one I will have to think about for a while . I really don't see the connection .
,
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
it seems a lot of people here in the USA are rethinking how to deal with estate planing, more and more fairly wealthy people are cutting back on dwelling size and investing more cautiously. have you thought of setting up a trust? if set up wisely, it could bee what your looking for:unsure:

Trust set up correctly are the way to go . I just finished one up and am now in the process of closing it down that our family ( Folks) had .
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
it seems a lot of people here in the USA are rethinking how to deal with estate planing, more and more fairly wealthy people are cutting back on dwelling size and investing more cautiously.


I agree .
My California home is 3200 square feet . Our other place before we sold it was 5000 + sq. ft . The Panama house is 7500 sq feet . BUT our favorite place is 1200 sq feet here in Idaho . Just the two of us and that is all the room we really need . Now I look for ways to invest with a 6%-10% return on investment minimun. I'll be signing sale papers in the next week on our old home in California . The Panama retreat went on the market 2 weeks ago and I hope to sale by early next year . That will just leave us the little place .:smile:
I do like owning apartment complexes if the buying price is right . 20% profit return , on investment per year is a average return for me . I have not seen anything approching that % rate a year in homes ownership , ever .
 

AAUTOFAB1

Bronze Member
SUPER Site Supporter
Peoplein Europe prefer to rent over ownership. That's enough proof for me that is is as backwards.

.

many reasons they rent, i may be mistaken, but in Europe most of the private land, open farm land and such is handed down and development is very restricted, not all of it, but open land is hard to come buy. way to many people and not enough land.
 

EastTexFrank

Well-known member
GOLD Site Supporter
many reasons they rent, i may be mistaken, but in Europe most of the private land, open farm land and such is handed down and development is very restricted, not all of it, but open land is hard to come buy. way to many people and not enough land.

That's one reason. Another is the fact that they have a lot less disposable income. It's very difficult in many areas for people to get the 20% deposit together in order to qualify for a mortgage. The situation may have improved in the last decade or so but it's still tough for ordinary working people to get the grub stake together in order to buy.
 

NorthernRedneck

Well-known member
GOLD Site Supporter
All I know is I'm glad I started working at the age of 14 and saved all I could to come up with a downpayment for my first house when I was 18. I purchased my grandfathers house back then and rented it out for a year while I stayed living at home and worked part time while going to college full time. Three weeks after graduation, my tenant informed me he was moving out. Two weeks later I started moving in. I'm glad things worked out the way they did. I have never had to rent until last year when I moved to the city. My parents are also in the rental business. They were looking to buy a duplex. I moved into half for a year until my fiancee and I were able to find a place big enough for us and our 4 children. I hated renting even though it was from my parents. Just the thought of being under someone elses rules and basically having a feeling of loss of control sucked.
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
Now remember you young "Whippersnappers" that I said older folks in the title of this thread .

Being under 60 brings another angle to this whole opinion of mine . I think home ownership is the best idea as soon as a young person can buy .
Its old folks that I am talking about .
 

Snowtrac Nome

member formerly known as dds
GOLD Site Supporter
Allen I thought you were only in your early 30's. now that we know your age did you also have a pony tale when you were young.
 

FrancSevin

Proudly Deplorable
GOLD Site Supporter
Maybe ,,, But what happens when to have a beautiful place valued at $750K plus and some Piece of Shit moves in on the next parcel and builds a POS house, starts putting up tin sided out buildings that a monkey could build better and then brings in 11 rusting cars and trucks to park around the place ??? That kinda sucks the old value right out of anything around it . Believe me it does happen often . The guys a retired fat ass cop who thinks he is above the law ,,, any law . He has made it clear , you turn him into the county nothing will be done and he will get even . I ought to know , he once lived next door to me .

As far as your comparison to Europe folks renting so it must be a bad idea, :doh: that one I will have to think about for a while . I really don't see the connection .
,

If you have a $750K house the value of which can be ruined by a bad neighbor, I suspect it wasn't solidly worth $750K. We have that kinda example in subdivision all the time. Mostly it is perception. But sometimes real. And sadly true. Especially in the country where code enforcement is lax.

At best, you are citing an anomolus case here. Most folks who buy a house don't have that problem. But it happens. Rezoning a shopping mall next to you, A school goes in accross the street, a gas station or a dive bar,,,,,,,,there is always a risk, on any investment.

However, it still hhold true as a general rule, one house for a home to live it, is a good investment over renting. If owning realestate was more costly than renting, then why would anyone be a landlord?
 

Snowtrac Nome

member formerly known as dds
GOLD Site Supporter
Maybe ,,, But what happens when to have a beautiful place valued at $750K plus and some Piece of Shit moves in on the next parcel and builds a POS house, starts putting up tin sided out buildings that a monkey could build better and then brings in 11 rusting cars and trucks to park around the place ??? That kinda sucks the old value right out of anything around it . Believe me it does happen often . The guys a retired fat ass cop who thinks he is above the law ,,, any law . He has made it clear , you turn him into the county nothing will be done and he will get even . I ought to know , he once lived next door to me .

As far as your comparison to Europe folks renting so it must be a bad idea, :doh: that one I will have to think about for a while . I really don't see the connection .
,

Al that sounds like me except I was never a cop just a solder other wise lots of unfinished projects at my house.
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
If you have a $750K house the value of which can be ruined by a bad neighbor, I suspect it wasn't solidly worth $750K. We have that kinda example in subdivision all the time. Mostly it is perception. But sometimes real. And sadly true. Especially in the country where code enforcement is lax.

At best, you are citing an anomolus case here. Most folks who buy a house don't have that problem. But it happens. Rezoning a shopping mall next to you, A school goes in accross the street, a gas station or a dive bar,,,,,,,,there is always a risk, on any investment.

However, it still hhold true as a general rule, one house for a home to live it, is a good investment over renting. If owning realestate was more costly than renting, then why would anyone be a landlord?


again .... read the title . It says "older folks" .

So what your are saying is if I turned down a unsolicited Cash offer of 750K , (twice) to buy my home when it was built and other homes in the area are going close to the same value , then the home was not worth the money ???? Damn that is some real forward thinking ..... .I guess i should have taken the money and ran .

You need to go visit a local real estste office and ask them how often they see this .I solidly suspect you will have your eyes opened at how often it does happen .

One example , You watch Habitat for Humanity put in some homes in a area and watch how fast the home values comes down around the area . I have seen this first hand .... many times .
What you ususally end up with is a class of people moving in these homes that only care about a lower house or rent payment and they bring everything with them when they move in . Junk cars ( regstered to still be legal). As many dogs as they can get away with and anything else they can get away with . Out of one project of 5 homes , 4 looked like a junkyard/2nd hand store within a year .How happy do you think the nieghbors are now???

As guess as long as it does not happen in your back yard or town it is a mute point .
 

FrancSevin

Proudly Deplorable
GOLD Site Supporter
again .... read the title . It says "older folks" .

So what your are saying is if I turned down a unsolicited Cash offer of 750K , (twice) to buy my home when it was built and other homes in the area are going close to the same value , then the home was not worth the money ???? Damn that is some real forward thinking ..... .I guess i should have taken the money and ran .

You need to go visit a local real estste office and ask them how often they see this .I solidly suspect you will have your eyes opened at how often it does happen .

One example , You watch Habitat for Humanity put in some homes in a area and watch how fast the home values comes down around the area . I have seen this first hand .... many times .
What you ususally end up with is a class of people moving in these homes that only care about a lower house or rent payment and they bring everything with them when they move in . Junk cars ( regstered to still be legal). As many dogs as they can get away with and anything else they can get away with . Out of one project of 5 homes , 4 looked like a junkyard/2nd hand store within a year .How happy do you think the nieghbors are now???

As guess as long as it does not happen in your back yard or town it is a mute point .
Al, I get it about older folks. But it remains thesame. READ WHAT I SAID<<<<<if it is the one dwelling, it makes sense to own not rent.

Even for older folks. I haven't seen where owning one house(the point I make in distinction) and making payments is more costly than renting. I'm sure there may be instances where someone could make such a deal on property in which the owner has no liens and can therefore be, shall we say generous or foolish, give the old folks a break. But mostly rent goes by the local market. And that is high enough to make the mortgage payments or putthe money in the owner's pocket.

Owning several houses around the world is an expensive luxury. You question is similar to asking,"is it beter to own a sailboat and have it hauled to the palces I want to vacation, better to own two or three sailboats and keep them at various locations,or better to rent a local yatch when I visit those places." In everycase, you are talking about a luxury, not a neccesity.

We humans need at least one dwelling in which to reside. I say best you own that ONE. As for the others, yeah, rent them and let someone else worry about costs of ownership. It's how landlords earn their keep.

As for having my eyes open, I dealt with the problems you suggested for years as president of the HOA. Everyone who came to meetings brought it up. Everytime. "my neighber has an old truck in his driveway." My neighbor has three dogs. My neighbor has a barn an old trucks, tractors and such rusting away, My neighbor has loud parties. My neighbor has been building his house for years and never seems to clean up the debris , much less finnsh. My neighbor sold out to a day care company. My new neighbor is inner city trash and they bring their family out every weekend to party and trash the place. The city wants to zone my neighbor's yard commercial but not mine, that's not fair." Blah Bla Blah,,,,Aud nauseum.

I'm not saying you are wrong, it is just the facts of it. Such ubiquity of risks is understood.

Now, have another Cuba Libre'
 

BigAl

Gone But Not Forgotten
SUPER Site Supporter
Al, I get it about older folks. But it remains thesame. READ WHAT I SAID<<<<<if it is the one dwelling, it makes sense to own not rent.


Now, have another Cuba Libre'


I'll buy you one to help clear the cobwebs .

One person or family bringing down home values for everyone around them ???? Yes, it can be done before you know what happens . I don't care how many HOA you are in charge of, . This guy overrides everything you can do and he has done it and still is doing it . In fact his reach is a little more than you realize .



I rest my case :
 

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