Comment by crazygringo

Comment by crazygringo 3 days ago

1. I mean, investors invest to make money. You make money by renting. Otherwise you're just throwing money away, which isn't what investors like to do.

2. In general, rent payments are less than mortgage payments for the same property (though this can vary in specific cases due to a number of factors). So the point is the renters get to save more money than they would with a mortgage.

And the problem with buying and selling is the realtor fee on both ends. You can't buy and sell a house every year or two. You'd go broke real quick.

haiku2077 3 days ago

> In general, rent payments are less than mortgage payments for the same property (though this can vary in specific cases due to a number of factors).

This didn't seem true to me - Anecdotally, my friends pay more in rent for apartments than I do for my mortgage on a single-family home in my area.

Then I googled it, and turns out my city is one of the top five US cities with the highest ratio of renting vs owning cost, and indeed a place where it costs nearly twice as much to rent as it does to own.

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crazygringo 3 days ago

> and indeed a place where it costs nearly twice as much to rent as it does to own.
Which is exactly where the supply and demand is out of whack. But fortunately, the more people buy places to rent out, the cheaper it becomes to rent.
The renters in your area would love if investors bought a ton of properties and rented them out, increasing supply and therefore bringing down rates! And if rents are really 2x mortgage payments, then there should be tons of people lining up to do so, since it's basically just free money lying around. The invisible hand and everything.

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- elcritch 3 days ago
  
  Unless they're all using price-fixing software to form a de facto cartel to keep prices high.
  
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  danaris 3 days ago
  
  ...Which we already know they're doing, so the downvotes you're getting are pretty unfair.
  
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dmbche 3 days ago

1. Investors make money by doing other things than renting properties, do they? Even property investors are able to sell at a profit.

2.Nearly half of renters in the USA are cost burdened (https://www.census.gov/newsroom/press-releases/2024/renter-h...).

It is mental gymnastics to say that renters are saving by renting.

And about realtor fees, that sure would affect my decision to move or not. Or to rent an appartment/condo, which is almost always possible, especially in urban centers.

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crazygringo 3 days ago

1. Not really? You make money by renting until you sell. What other things are you talking about?
2. And lots of homeowners are cost-burdened too. What's your point? The US is an expensive place for everything. Mortgage rates are crazy expensive now too.
It's not mental gymnastics to say you can save by renting. There are lots of online calculators where you can see the places in the US where it's cheaper to rent than to buy.
And sometimes you have to move for a job, period. And families don't always want to rent an apartment, they want to rent a house with a backyard, you know?

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- dmbche 3 days ago
  
  1. So investments can be in other sectors than housing, I've heard. I'm sure you can look it up. Or you're welcome to lecture me too.
  2. If a homeowner has more than one property, why not sell one of the properties when you become cost burdened? Also, I think at some point you stop paying a mortgage, right? I don't think that's the case with renting.Oh and it's a neat financial tool too, a mortgage.
  So yeah renters would be better off owning, other than in some niche situations.
  I don't understand what brings people to move for jobs if the salary doesn't make housing trivial for them. You're saying people on a 50k salary will move cities rather than change jobs?
  Edit0: and that link I sent earlier that you probably didn't open shows that renters on average pay 30% of income on housing, while owners with mortgages paid 20% and 10% without a mortgage. Renters are the in the absolute worst situation however you want to cut it.
  
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  crazygringo 3 days ago
  
  The subject here is property investors. You seemed to be claiming that they would buy a property and not rent it. So I don't know what "other sectors" has to do with anything?
  And no, renters are not better off owning, except in "niche situations". I genuinely don't know where you've gotten that idea. It depends highly on your local market, but on average renting is cheaper than owning, and it frees up a lot of money that can be invested more productively.
  You seem to have some kind of prejudice against renting, which I genuinely don't understand. And your concept that the cost of housing ought to be "trivial" for people to move is incredibly unsympathetic. An assistant professor will move for a better chance of getting tenure. For a fellowship. For whatever. A lot of people can't just "change jobs". They have training for a specific niche, and often advancing their career requires moving to a different city, full stop.
  
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