Should I rent or buy a house?

[WilliamChanner]

I know it depends. Nevertheless, still interested to hear your perspective (opinion).

Just had a long heated discussion with my grandmother and her friend who ganged up on me and said I need to look into buying a house, instead of renting. I don't like the idea of having a mortgage. But, in their own unique way argued that it's a wise investment for the future.

What do you think?

[philiphodgen]

Home ownership tells me a story -- "You are staying right here." For better or worse it is not easy or cheap to sell a house. If you plan to stay in one place for a long time then there is a lot to be said for buying and methodically paying down the mortgage.

Internet experts analyze home ownership as an economic decision, using their personal beliefs about economics and investment theories, as well as the perspective of their extremely limited life spans. "What is true for my 32 years on the planet whilst breathing the air of Texas must be a Universal Truth for all sentient beings." I exaggerate slightly.

The point is, you are alive once. You are you. Owning a home is an important meta-message to your brain about who you are. Use that to your benefit.

At one point in my life I had to be told rather abruptly to just stay put for a decade. That mattered and it helped me immensely. I now have six years to go until my youngest child finishes high school. Things may change then. But the personal benefits of staying out have been immense.

So my suggestion to you is that your grandmother may be talking about these intangibles -- based on a lifetime of experience. You may be looking at home ownership with the investment logic in full gear. Both are important. But give greater weight to the story told by someone with a few more decades on the planet. She knows something you don't.

And remember. You can't make a mistake. If you buy a house and it is horrible and you sell it and you lose money? You have lived your life. You are not in a race. I have fucked up innumerable things, at great cost. I am richer for it.

[tsuyoshi]

You don't mention buying an apartment, so I will assume you meant "rent a house or buy a house" rather than "rent an apartment or buy a house". I know that in some places, choosing whether to rent or buy also means choosing between an apartment and a house.

Aside from the financial considerations (mortgage interest income tax deduction, homeowner property tax deduction), there are some problems with renting that are magnified with a house rather than an apartment. There is maintenence (mowing the lawn, cleaning up graffiti, removing weeds/garbage from the front sidewalk, properly insulating the house) that is normally performed by the resident owner, which both the nonresident owner and the nonowner resident have a lower incentive to perform. For the nonresident owner, it's because they don't care about the quality of life for the resident, and for the nonowner resident, it's because they don't care about improving the property value for the owner. This is one big reason why "bad" neighborhoods are so poorly maintained: most people are renting. In "good" neighborhoods, usually most residents own their home.

On the other hand, it's popular just to see homeownership as a good way to engage in leveraged property speculation, but that really depends on whether you're living in a prosperous city or not. Buying a house in San Francisco is probably a good investment; buying a house in Detroit is probably not.

[smaksi]

Here is my opinion: if you after financial gains or losses, use this calculator: http://apblog.imakescience.com/2013/09/how-do-i-identify-rea...