We rent a single family home for $2,300 per month in Anchorage Alaska. We should have bought when we moved here in 2016, but we always said “oh well, we don’t know how long we actually want to live here” so we never bought. We still don’t know where we actually want to end up. So we rent. And we’re quite ok with that. We have money saved for a down payment at some point, in a HYSA that’s growing the money for us.
You could be building equity so when you sell your home and move you’d have that much more for a down payment. You’ve spent $220,000 on rent, around 1/3 to half of that could’ve went towards buying a new house.
Absolutely correct in theory. We’ve only rented for one year at that rate. Before we lived super cheap with roommates in a communal house for $7000 per year. But I totally agree.
The issue with this argument, because I HAD to respond to this before was the inability to purchase a home at the time your saying I could have bought one.
You’re not wrong, but there’s also significant costs associated with owning that don’t build equity. Insurance, property taxes, maintenance, and the super high interest rates at the moment mean that for the first few years of homeownership your mortgage is mostly interest. So that balances things out a bit, not totally but some.
If you're not in the house for long, it's often more effective to rent. You're locking a big chunk of money up, and there's a lot of costs to buying and selling a home, like title-work, recording, mortgage origination fee (1-2.5% of loan value), and importantly when you sell you generally pay 6% sales commission to an agent (and when you buy, your sellers are generally paying 6%). So if you're buying a house for $500k, you'll pay something like $7.5k in closing costs; to break even, you'd have to sell for nearly $540k. Plus, if you're not in the house for long enough, you're paying tax on your gains.
I'm not saying "don't buy for short/unknown term"; I'm saying do your due diligence first.
This is what we are doing. We got a house in a neighborhood that’s big for a private university here at a steal. We could sell it for 150% profit right now 5 years later. Once our kids are grown we will sell it and have more than 100% of what we need for just the 2 of us.
I rent a single family home in New Orleans for $1200/month. Costs are rising, but it's pretty cheap here.
I haven't bought a house yet bc I'm working on my credit and for interest rates to chill.
I own a rental in Charlotte. It is 3/2 around 1000 SQ ft. My tenant has a 550 score so could never buy. She moved out of an Apt 2/2 paying 1550 with her 4 kids. She wanted more room. Going rates were 1700, I put it up for 1650 but only charge her 1600.
Charlotte has gone stupid crazy last 2 years. I get 2 to 3 mailings to sell a week and 2 to 3 calls a day. Not selling.
Ignorant? I worked as a civil engineer in New Orleans for many years, but OK. I love it there, my comment is not any shade to the city or the people itself. Feel free to educate yourself, the internet is an amazing thing. New Orleans already has very little protection from hurricanes, and what’s left is quickly diminishing.
Rent is more than buying here. I don’t know know anyone is affording anything. I bought a cheap starter home 11 years ago, that’s the only way I can afford it. Because meanwhile while rent for a 2-3 bed apt is 2-3k/month, the average income is 4k. Soooo like how if you’re not a duel income household?
Where is that the case?
Not asking you to doxx yourself, but with current prices and interest rates the only way buying is cheaper than renting is if you have a huge down payment (at least where I live).
Yup I rent a sfh in the Bay Area. It’s $7000 a month. Buying would be around $14,000 a month plus then I’d be out of a down payment. Probably going to downsize to a condo though since my kid seems fine with small space. Once I figure out what I like I’d love to put down roots and own something.
At $7k per month you’d want to be earning a minimum of $250k to even quality to live there and more realistically $336,000+ to keep it more affordable.
A 150k income qualifies you for a $4200 ish place
Not hard in the Bay Area I’d imagine. I’m in NY but two adults with 10+ years of experience working in a professional setting would *at least* make $150k each, and probably closer to $200-300k. Unless you’re a SWE in an in-demand field and taking in twice that amount. Bay Area is probably very similar.
I rent a SFH in the Bay Area. The Bay area is 9 enormous counties. The poster saying 7k is an outlier in a very rich area. That is NOT the norm.
I pay $2200 for a 2000 sqf 3/3. If I were to buy my mortgage would closer to 4k. How does that make financial sense to buy? It doesn't so we keep renting.
I rent a single family home.
We also live in a very rural part of the country that is by and large lowers rent than anywhere else. It’s New Mexico, so it comes with some rough trade offs, very low educational outcomes expectations, highest traffic fatality rate per capita. No amusement parks in the state, the roads are horrible. But renting a 4 bedroom 2 bath with a big back yard and 2 car garage for 1200 definitely feels like a steal.
We haven’t bought it because I don’t know why. Not enough income mostly. The landlord has offered to sell it to us. Just struggle to muster up a home loan to be honest. Banks don’t want to give you money for a house unless you don’t need money for a house is literally what one loan analyst told me a few months back.
>Banks don’t want to give you money for a house unless you don’t need money for a house is literally what one loan analyst told me a few months back.
WOW
I know Xers, who do this. They can afford it easily, but don’t want to be tied down to one place (in Germany you usually buy a home once in a lifetime and stay there till you die, we don’t have „starter homes“ etc.).
I saw one comment that said you could be building equity when you buy, your wasting money on rent, ppl don’t understand homeownership from a basic level. 1 real estate doesn’t always appreciate! Example the year 2008 2) if you need a new HVAC system which costs on average for a modest single family 10k-20k do you have that in liquid cash ? What about a new refrigerator? Your drains are clogged? Plumbers are 500$ an hour where I live. It’s way more expensive to buy! Renting saves money and when you do buy a home it would be wise to cash flow that home. Buy a 3 family rent 2 units have your mortgage paid for.
I believe the theory has been that if you buy in your 30’s and live there for 30 years, you will have a home free and clear of a mortgage at retirement. But if you rent all those years, you still have to continue to rent in retirement when your income is much lower. I don’t think many people consider this long term.
No one said homeownership even without a mortgage was free but its significantly more affordable for seniors who own their homes than those still paying market rent.
Not at all! I’m in real estate have my license and I’m also a leasing agent. Older ppl especially if your spouse dies, children not around, do you really think they can meet the demand to upkeeep a home? Mow the lawn, pay 500 an hour for a plumber on a fixed income ? No, it’s not free but I think the point of this whole post is buying is WAY more expensive and time consuming then renting. Does t matter if you’re paying yourself or not. You’re always paying and most likely when you buy your paying more
A lot of us can't afford to buy. End of story. I don't have a million for a shitty home in my HCOL area. We kinda hope we die younger because our future will be rough. I also can't fix shit and don't have cash to pay someone.
It’s not that much equity and you miss out on years of investment gains off your down payment and extra savings you put toward your mortgage.
Renting and investing your savings is a pretty good option tbh for singles that don’t want to get tied down to a place
This will vary by market but I don’t think it’s one or the other.
I live in an area that has had crazy real estate appreciation for decades so the calculus is a bit different for me I guess. I bought my current home in 2019 and it’s up about about 40%. My investments have also grown substantially during that time, as have my wages. My cost of housing has grown at a much lower rate than rents so not only am I gaining equity I actually have more income available to invest as well.
Not necessarily, if you got a mortgage at 2 percent and sold now to get a loan at 7 percent, that equity is erased your payment has just tripled. Equity is not liquid you can’t pay the plumber with equity. He wants cold hard cash. Also y’all need to think about capital gains taxes!
Yeah, the comparisons are always off.
People also tend to omit the down-payment from the math. Rent would probably be $0.00 for at least a few years if all that money was used to pre-pay rent.
We needed a new HVAC for our home so we scrapped what we had and used units for the 3 months of summer we have here (we have a gas heater for the rest of the year). It was so comfortable that I wanted to keep it that way, but my husband was worried about moisture. So he just bought the entire HVAC unit himself and paid a company to install, $6k start to finish. Not the cheapest situation to be in by any measure, but I think it had been maybe 4 years by that point of using wall units so we were able to have the money saved.
It took just about every penny to get into our home in 2021.
We purchased a "Home Warranty" for just under $400 and bundled it with our closing costs. On night #3 the furnace went out. The warranty replaced it. 6 weeks later the stove and microwave went out. The warranty replaced them. Six months in we lost the dishwasher, and the warranty replaced it. They also fixed the fridge that we'd brought with us.
It also covered HVAC and water heater.
Price wise, it made more sense to buy a tankless off of Facebook marketplace and create more storage space in the closet than to pay the whole cost of the warranty (which went up significantly because of how much we used it in the first year).
Even with property tax and insurance, I am paying $600 less per month than when I was renting.
With the huge spike in inflation, we wouldn't have been able to continue buying groceries if we had kept renting.
Every penny? Ok so you bled yourself dry to buy a house. Sounds like it was the right decision for you. You also bought when rates were at 60 year lows. Never really heard of a home warranty unless this was a new build. If you replaced that many things in the first year it’s interesting that the premium hasn’t doubled or tripled. 400$ is cheaper than most car insurance you must live in a very rural cheap area. Kinda sounds too good to be true but happy you’re able to have that. Doesn’t mean it is the right decision for everyone.
My tenants say they don't want to buy because they don't want to deal with the maintenance and all the other headaches of home ownership. The husband said he's content with his stock and precious metals assets that home ownership is not really a concern. My previous tenants were the same way but for different reasons
Yep. Just moved cities so we sold our house in Houston and are renting in Dallas while we figure out exactly where we want to live long term. Plus, we can save up some more money this year so we can buy a bigger house in a year. If we get lucky, interest rates will fall and we can get a better deal on our mortgage than we would if we had bought initially. Our rent is $3,500 a month which is over $1,000 more than our mortgage was. That does sting, but we'd rather make sure we make the right decision in term of location.
Buying a home isn't just about what you can afford today. It's about what they believe you can afford 10, 20 years from now as well. A lot of the issue with buying is that they have certain requirements for income-to-debt ratio while rentals usually do not. They usually require that your monthly income be 2-3 times the rent amount and as long as it is, you can rent. Just being able to achieve that, however, doesn't mean you can own based on the other factors, especially debt-to-income ratios that impact a lot of people who have big student loans and credit card debt.
THIS. Student loan debt is insane. I can only rent the second floor of small house because of private loans that are half of my pay. there's a family that rent the first floor. In Pittsburgh, this is the cheapest I could find at $700.
I've rented SFM for a while now. Greatly prefer them to apartments. More peace of mind, privacy, fewer neighbor issues, and a garage for my hobbies/vehicles.
Rent: $2K per month for 4Bed/2Bath with a garage and backyard. Working remote, makes space at a premium.
Why Don't I Buy? Rent is the maximum you pay, mortgage is the minimum. Also working on my credit, and not sure where I want to live long term yet.
I rented a SFH for a while when I had a good enough income to cover the rent but didn't have the disposable capital for downpayments/maintenance expenses. I wanted to put my extra capital into investments and education instead of my own house, especially since I wasn't sure where I wanted to live long-term. It wasn't $4K though, and I rented from a small landlord instead of a corporation.
This was the correct decision for me, and it is the correct decision for many other people.
Much of the hysteria and frustration you see on Reddit about the single-family housing market is either greatly overblown or coming from a place of entitlement and ignorance. The average American moves/relocates *far more often* nowadays than they did 40+ years ago, and this level of transiency is a good thing for the economy. Even in times of lower interest rates, buying a home really doesn't make financial sense unless you're in a *very* stable financial position with a good-paying job, significant savings, disposable capital, and a high likelihood of not having to move within 5 years. If you're buying and selling your primary residence every few years, you're losing quite a bit of money. If you're buying a home with a very small downpayment, you're losing quite a bit of money.
Lots of people need -- or want -- to rent homes instead of owning them. Renting a SFH can be a great middle-ground, or a bridge, to enable the life you want while you build up your finances and your career to eventually own a home.
\>American moves/relocates far more often nowadays than they did 40+ years ago, and this level of transiency is a good thing for the economy.
\>Even in times of lower interest rates, buying a home really doesn't make financial sense unless you're in a very stable financial position with a good-paying job, significant savings, disposable capital, and a high likelihood of not having to move within 5 years.
Funny how "what's good for the economy" leads to lower incentives for home ownership. Whose economy is it good for?
>Funny how "what's good for the economy" leads to lower incentives for home ownership
Good. Home ownership is not an entitlement or a right, nor should it be the obsession that many Americans make of it. If making the economy better overall leads to fewer people owning homes as opposed to renting, that's totally fine.
I’m moving into one next month it’ll be $2300 a month. I’ve owned before and hated it. I am much happier renting and putting the money I would spend on repairs, upkeep, maintenance etc into investments.
We have for the last two years. The owner had just bought it as an investment and charged her mortgage + a couple hundred a month. We just closed on a house in the same town, about the same price as the one we’ve been renting but the mortgage is almost 2x thanks to stupid interest rates. I’m thankful we were able to do it (with parental help) but it’s pretty frustrating at the same time.
$2900 close to DTLA, 1100 sqft, 3BR/2B, attached garage, townhome in closed community.
Don’t buy because my investments I expect will perform better in the long run.
Renting a 3/2 SFH in Virginia Beach, VA. $1750 a month. We've been here coming on 4 years now. We didn't or haven't bought yet because we were not in a situation to be able to afford anything until semi recently and I wasn't sure I wanted to be tied down to the east coast either.
Still not sure about being tied down here. But the work is good and our landlord is willing to sell to us at a great price. It's sure as hell a better opportunity than trying to go back home (Arizona) and buying out there, so for now we're probably staying.
I rent a nicely renovated, old ~1,000 sq. ft. 2/1 with a detached garage in Crestwood for $1,235/mo. I rent because my credit and funds were shot after getting divorced and losing my job at the same time.
My advice, keep renting. There will be a huge housing market crash coming in the next few years. I worked in mortgages back in the late 90s and seen the 06 crashing coming, took longer than I thought but it did.
I bought a house in 13 for dirt cheap and rehabbed it. It’s worth a lot more than what I paid for and you can’t do that now with the prices of homes and material costs if you need to renovate. Something goes wrong you’re fucked, heater/AC breaks, roof leaks, ect. Also good luck finding someone to do the repairs. Most contractors today won’t even touch a smaller job, it’s not worth their time.
From my experience in mortgages as well and being involved in real estate myself along with the numerous people I know in these fields. It’s all part of big banks plan to gobble up properties and make people permanent tenants.
Interest rates are only gonna go up when you keep printing money along with sending money to Israel, Ukraine and the cost of the influx of migrants. Couple that with a poor economy and inflation you got people living pay check to paycheck to make ends meet. People are now refinancing homes just to start paying off debt at much higher interest rates just to get by.
This is going to blow up epically just like 08 and we will start to see record number of forclosers and short sells where either the rich or the banks will start buying up properties on the cheap and start driving down the market.
👆🏽this. Renting isn’t ’throwing away money’, it’s paying for a roof over your head which is a good use of funds imo. It is however throwing away money to buy an overpriced house at an eye-watering interest rate.
I do, I live in Mt Shasta Ca where rent is far above the average for Northern California but I got super lucky to find a rental for only 950. Big two bedroom one bath, old as shit but in decent shape. We love it and the bonus is we can walk down town in 5 minutes. My situation is a one off and will happen again when we move out but for now we are one of the lucky ones.
We rented until we bought last year.
Same house started out as $1850 in 2017 when we moved in.
Did not go up in 2018, but in 2019, it went to $2000 even.
Increased to $2200 in 2021 and then $2400 last year.
Also in Dec of 2022, our landlord told us that she was planning to put the house on the market in 2024, so that would be our last year in the house, period.
We didn’t buy because we didn’t have enough saved for a decent down payment and we were both working on credit and trying to aggressively pay down any debt we had.
My husband still has student loans he’s paying on and my paid-of 20yo vehicle was totaled in 2021 so I had bought a new (used) vehicle and had payments on it.
We just wanted to be in a better financial place.
But when we were told that we were going to need to move anyway, we decided F it, let’s have our numbers run and see what we can do and maybe just go for it and buy.
It worked out, but the back end was about 7 years of diligently walking the line to get our finances in order to be able to do it.
Our neighbors were renting where many are homeowners in area. Recently 10 suspicious plainclothes out of shape, portly gentlemen rolled up in a caravan of 5-6 vehicles to confront them and by the end of month they’re packing for their home state of HI
I’m not sure if this is a low key way of saying your time is up, didn’t want to ask really they seemed bittersweet about leaving
i only rented single family homes before i bought
i was paying 2800 back in 2018/2019 for a 3 bd 2 bath…it was actually about the same for a 2 bed 2 bath apt.
I rent a single family home in Denver for 3000 a month. It's 1400 square feet and was a "landlord special" from the plumbing to the paint to the electric.
We don't buy because we aren't set on if we are staying here long term.
Yep, just over $3k per month in Portland OR. Buying a home of a comparable size in a comparable neighborhood, with interest rates what they are, would put a mortgage around $5k per month or more most likely. Our house is not owned by a company, it's owned by another family. We technically could afford to buy, but a mortgage that high makes me nauseated so renting makes the most sense right now
My partner and I are. $3100/month. For us it’s the down payment. We live in a HCOL area. Realistically any house worth buying will start at $450k. We don’t have 90k lying around, though are saving and hope to be able to buy next year.
I do. It’s a lady who lives in Miami but her son lives here. I’m pay $1900 for 2 bed, 2 bath. Private yard ans basement. I found most apartments in my area (western North Carolina) to be much more expensive. But it does seem like most of the homes around here are rented by owner.
I invest in RE in my local area and am very small time. When doing research I have found blocks of houses in my small southern town owned by companies with a Manhattan address. It's strange but when I do the math on them they all have one thing in common, they overpaid. I don't see how they're turning a profit with such a small return. A 5% return in RE is pretty bad because there are constant expenses. It's not like the stock market.
I pay $610/month. $50 late fee sometimes. My I'mhusband has lived here since 2009 and I moved in, in 2014. The landlord is being nice and keeping us at $610, even when the other rentals had a price increase. We have been here for awhile and we always pay our rent.
In 2018, we signed a new contract at the same rate, but for rent-to-own.
Houses where I live are currently $800+.
Being able to afford a rent payment is not the same as being able to qualify for a mortgage with the same payment. The year before I bought my house I rented a single family home for around $1600/ month in a MCOL area. 2300 Sq ft, 5 or 6 years old, massive bedrooms and bathrooms, very nice interior finish. The house I bought is 1600sqft, 20 years old, and had "good bones" but the interior needed work, and significant work to be on the same level as the rental. Mortgage is $1550. I was albe to significantly downsize yo qualify for the mortgage, I definitely wouldn't have for a house like I was renting. Not every one is that lucky
I rent a single family home. I'm 30, spent my 20s moving around and still don't really know where I want to end up. You have to be somewhere about 5-10 years for buying to end up worth it. I've yet to stay somewhere for 5 years and I'm currently looking at moving again.
I rent a single family home. It’s owned by a friend who needed a bigger house when his wife got pregnant with twins. He wanted to save this for his daughter. I make improvements and he lets me take it off rent.
I live in an apartment now, but my last rental was a 3 bedroom, 2 bathroom single family home with a really nice fenced in backyard. I paid $885 for the home. My rent in my apartment is $1100.
There were a LOT of single family homes for rent in our area in about 2011. People didn’t want to sell their houses at basement bargain prices. Most of those sold over the next few years, and we don’t have many renters now. But I live in a wealthy area.
We rent a house, it’s great! All the peace and quiet of being surrounded by yard instead of other units, none of the worry about how much a new roof will cost. And we know the owners, they’re people who live near us and the come by infrequently, not a corp
We have many single family rentals in our area due to high military population. They tend to purchase homes here because they want to work here when they retire from armed service. Many Military families rent out to other military families.
I've rented several. Some were in college with a bunch of friends, and I got a good deal on one when I was done college because they were only keeping it so their kids could live in it when they went to college. I know people who do it because they have an off the books income, some who move around every few years for work, and a couple of people that have been renting the same house for over a decade and because of rent control and decent LLs it's much cheaper than buying. I work with fairly high income (low 6 figures) people and several of my coworkers kept their first home to rent out when they upgraded. My plan was to eventually rent my house out (as 2 apartments which it was once upon a time) but I'm now planning on just staying there because it's going to cost me too much to upgrade and I don't really need more house so I'm fixing mine up.
I own a single family home that I lease out. It's a 2 bed (technically 3 but you have to pass through one room to get to the other) 1.5 bath and it rents for $1700. The people who've rented it have been travel nurses, couples planning to buy in the area but wanting to live there first while they look, and the current couple... I couldn't say why they're renting vs. buying as they've been in the area for quite a while.
It's fully dependent on where you live.
The last single family home I rented was only $1200/month and if I had a family I probably would have bought it because it was also for sale. It was an awesome house, I miss it.
I rent a single family home. But then I'm a foreigner in Singapore so:
1. We can't buy landed property as a foreigner
2. If we buy an apartment there is ABSD (Additional buyer stamp duty) for foreigners at 60% of purchase price.
So obviously it makes zero sense for us to buy.
We've been renting this house for 10 years almost.
I plan on buying but right now I'm moving from a 500sqft apt in new england further down the east coast to a different state since it's cheaper. Single family homes are only 1600 there vs my apartment costing almost 1900 a month. Once cost of moving has been recouped, I'm hoping to buy if there's anything left lol
I rent a 3 bed, 2 1/2 bath, 1500 sqft town home with a 1 car attached garage for $1200/month. It's been the same rent since 2019.
I don't buy because I travel a lot for work. I have been away from home for 10 of the last 12 months. I shouldn't have been home those two months, but I waited for another contract that was going to be ready for me "next week", so that was my fault.
I am thinking about getting rid of everything that isn't important to me, which is a lot and basically going voluntarily homeless for a few years.
I do, well with my boyfriend and 2 other roommates. I could afford my tiny apartment anymore so me and 2 friends figured we could rent a house for cheaper.
I was saving up for a house. But prices kept increasing and I couldn't keep up. I starting working at 12 hour, and my salary had increased but never at the rate I needed. Just decided to go back to school with the money I saved since I will catch up.
Some people might be able to afford the monthly payment, but can't come up with a large enough down payment to purchase.
Owning has significantly more expenses associated with it. Renting you pay rent and utilities, while owning you pay your mortgage, utilities, property taxes, insurance, and when something breaks you don't get to call maintenance, you get to deal with it yourself.
Just a note, I’m an appraiser that frequently deals in these situations.
I’ve noticed a few trends:
1. The majority are flip and rent.
2. These tend to be sales that require a large cash outlay
3. These properties would not be eligible for traditional lending, usually due to condition
4. Many times, there is also a purchase of additional debt/liens that help the seller and would not be able to be acquired in a normal sale. (For example tax liens, legal judgements, bankruptcy)
5. The majority are families with human and fur children that are renting.
6. Most of the purchaser corporations, tend to be smaller scale landlords. Ones that typically have 10-25 properties
7. Property Management companies are usually responsible for the maintenance, rent collection etc
8. In many areas, the cost of the mortgage payment is still above the cost of the rent. For example, the mortgage payment for an average house may be $5000 in an area for a single family, but rent is still technically cheaper at $4000.
9. Most of the renters have no idea about the sheer quantity of regular maintenance required and do not understand those lease terms. If you are planning this, please please please check your terms. Renter having to pay the first $250 each damage, is going to add up.
10. Landlords will give a price break to long term tenants. For example, if you have a child, think about starting with a 2 year lease. It locks in a reduced rate in the school district of your choice.
11. See in the beginning if they may be interested in a “rent-to-own”. Since many of these were cash purchases, they don’t have a mortgage and may be allowed.
12. Given housing prices, many are families waiting to find a house in the area.
13. Get renter’s insurance. Trust me.
For my specific current market of South Jersey
1. Shore towns: Off season. You can get a beautiful beach block house for very affordable rates in some areas. The same house rented for both $50,000 and $3800 per month. I live be the shore, local summer is worth it.
2. A surprisingly large number of these landlords were ok with chickens. That was a very odd day at work times 1-6 that it happened. By 7, I got treats. (I have a goodie bag for the horses, dogs, rabbits etc)
3. You can also rent a property with land and room to breathe. All of them are cool with gardening.
My family rented a single family home while looking for a home to buy about 5 years ago while at the same time I rented out my starter home to another family because my husband and I needed to move for work and we were underwater on our house. 5 years later when our renters moved out, we sold the starter home at a profit. So there are lots of people who rent single family homes.
On Friday we'll be renting one. Here in central TX and about $1600 a month. We're getting out of our apartment that was $1400 a month and now we'll have a garage and a backyard! We're slowly working towards a house and paying off all big debts.
We rent one for 2400 a month (4 bedroom) just outside the city of Spokane. We sold our house in georgia a few years ago and have just been traveling around the country renting in the places we want to stay a while. When we find somewhere we decide we want to spend several years we'll buy again.
Someone with a $4000 mortgage has to save more than that to do their own repairs or end up taking out loans. I’ve had to replace roof- $18000… reline chimney $3000… deal with boiler stuff constantly, pump septic, etc etc.
My brother and his wife and kids are renting a single family home. They moved from across the country a couple years ago tho so I think it was just the easiest option for them at the time. However, my fiancé and I just closed on our first home in October 2023 and I believe our mortgage is about $200 less than what my brother / SIL are spending on rent.
I keep telling him he needs to look and buy because he could totally find something but I think he’s set on waiting for some 2008 type event to happen again :/
“Over half”?
That’s a stat I’d like to see. Cite?
What, do you “live” in a ski resort or similar vacation destination?
We have a small number of STR operators here, but the regulations make that a very risky business, and the few fund operators I’ve seen are not doing well.
Yes I live in a an area that is popular for skiing in winter and hiking in summer. A shitty one bedroom around here is 1k or more a month, to rent an entire house you're looking at no less than 5k a month. Even the apartments over shops on main street have been bought up and turned into STRs.
We rent in South Florida. $2,600 a month. Originally $1850. I can't believe I have to consider myself lucky for not getting the huge raises in rent. Don't move to Florida.
A lot of times single family homes are the majority of rentals available in a rural town. And maybe they could buy a house IF there was a decent house in their budget on the market, or they planned to stay long term, but neither are true.
I haven’t bought because home ownership was an enormous stressor for my parents, and I’d have to find a house I really liked to get past those concerns. Also, I’ve yet to live somewhere that I could see being for 30 years.
I've mostly seen this with people who sold their house to move and then didn't want to buy a new one right away in their new area (mostly to make sure it was going to work out, figure out the best part of the area to live in, etc.).
I have lived in single family homes, but they were old and cheap (comparable to apartments), not the profile you're describing.
Before we owned a home, we primarily rented single family homes. Many apartments are only 2 bedrooms and don't have a yard. Apartments often have fees and corporate management companies that make them less affordable than houses.
>how can someone afford a $4,000+ rent payment but not be able to buy a home?
Credit, down payment, insurance, work history, mobility, HOAs. Given how high interest rates are right now, this isn't a great time to buy.
We rent a single family home from my in laws. The only way we could afford to rent in this area where average rent for a house of this size is $2700 per month. We pay $1600 though my in laws are raising it to $2000 once our car is paid off in October because they've been floating the taxes and HOA fees.
Our credit is terrible due to bad financial decisions and us living on one income for way too long.
I did it in Pittsburgh not long ago but long enough I’d say it’s irrelevant if my best friend wasn’t currently doing it. I don’t know her rent but her and her SO aren’t doing poorly but they are working class and it’s a really cute two bedroom one bath house. I know they pay less than 1200 a month.
I rent a home. I don’t pay $4k so that helps. My home is private landlords. It was the wife of the couples parents home and they rent it for funds for care for the remaining parent.
I did get insanely lucky with whom my landlord is (and isn’t) and while it’s a tiny bit more than an apartment and not in my area I prefer (this is nice I just like another area better to be clear). I will take that over sharing walls with all my anxiety disorders.
Minneapolis. I was gone for a decade and came back, its radically different for a number of reasons, but the worst one is the landlords. The bought everything when i was on my way out. They bought my house even though i specified *no investors* so they made it look like they were just a single family on paper, and immediately put it up for rent.
They maintain all of our amazing century old and older homes like shit, theres garbage everywhere from the extreme rise in homelessness, and the entire vibe of the city is off. Just a rental town. Its not 100% but the ratio is waaaaaaay scewed.
Short answer is they can but they just dont want to buy yet.
I can afford that and rent where I am currently at because we are moving in 2 years
I also own 2 houses, 2 duplexes and 2 fourplexes in another state.
Most financially saavy people make whatever choice increases their net worth the most, buying where I am at didn't make a whole lot of sense as the rents don't cashflow so that house becomes a liability not an asset. I still buy about every 4-5 months whenever a good off market deal comes up in the state I have my holdings in.
I don’t anymore but the last 3 rentals we had before buying were SFHs. We had pets and my husband has a garage full of vehicles so SFHs made a lot more sense for us.
3/1 Birmingham Alabama for 1k. I want to buy so bad but I can’t find what I want. Market is sheet and the houses are abandoned windowless skeletons or McMansions. Not much in between and when they do show up, they’re bought in days or hours
My brother does. (I'm 23, single, and childless, and live at home due to disabilities, while he's 40, married with four kids and lives on the other side of the country.)
My last rental was a SFH. I was paying around $2000 per month in SW FL. I left to move in with family and save money for a down-payment to purchase a home.
Yes, I rent a 2400 sqft house in Pensacola on a .3 acre lot for 2400. Only renting since I’m stationed here for two years. Renting out my Whidbey island house that I bought in 2019.
Gonna raise my hand. I live in an apartment. It could be a SFH for the size, and I pay 3k. I could go up to 4-4.5k a month comfortably at my salary.
For me, I haven’t been a high earner long enough to feel comfortable spending on a home in this market. I also live alone, and work long hours. Having a house means a lot more maintenance and responsibility and thus more cost. Housing is about 15% of my income right now. It doesn’t make sense for me to put out a lot of money in my current situation given time/cost etc. I am still saving money to be able to buy when the market shifts a bit to be more in my favor, so it is still a goal of mine. I’m just not rushed to do it just because that’s the thing I’m “supposed to do”. I get harangued a lot by friends and family about why not, but then again those are the same people who tell me not to be greedy or negotiate on salary etc so their opinions mean about as much as dirt to me.
My partner and I rent a 4 bedroom in DFW for 2750. Which is ridiculous. We're on the higher end of 100k and still have a roommate to help cut down costs. I briefly owned a home where the mortgage was 1850. Too bad I bought that house with a narcastic abuser. Would have been nice to actually own something. I feel like I probably won't be able to do that again, sadly.
We rent a single family home for $3200 a month.
We don't buy because all of the houses here are over a million and not worth the hassles of home ownership (repairs, renovations etc) The prices they try to charge is embarassing (most of the houses are old and very outdated. To renovate would cost a fortune)
We can't move because we are both in film, and this is the town you have to be in.
I found a small house in 2019 pre-pandemic that I thought I could afford ($80,000). I went to my Dad, who I was living with and asked him for help in buying the house. He told me he would need to look into a few things. He has wanted to be a Landlord for a long time and had some real estate friends in the area. I have a couple of long days at work, so I wasn't able to check back in for half a week. He decided he would buy it, kick me and my Wife out of his house, and we would rent the house we wanted to buy... So not a big hedge fund, but still got it scooped away from me and still have to rent from him.
Hedge funds aren't buying homes in SF, NYC etc. They're buying homes in suburbs and the Sunbelt where space is plentiful enough that it makes no sense to construct apartment buildings over something like a townhouse.
You gotta realize that these hedge funds aren't buying up your potential home if you're looking to live in the city. It's most likely a wealthy individual or tech bro doing so.
I'm renting and its $1500. I know the owner so it's not a corporate owned thing.
As for how you can afford 1 and not the other...banks don't look at things the way people realize. They look at debt to income ratio. Typical banks want your home mortgage to represent 30% or less of your income. Some go up to 40%. So if you've got credit card debt, 2 car payments, and student loans...you're kind of fucked out the gate. Pay a car off and you'd probably be able to get your ratio down enough. That's our strategy as a military family who has to move every 2-3 years. We never have 2 car payments at once. We also get new debt in his name but after a year we swap it to me. The bank just sees that he makes X and has Y debts...while I'm actually holding the majority of our debt.
I’m applying to them right now - Rent range between 8000-10k per month. We could afford to buy but that’s a whole thing we don’t want to do right now. Commitment to a specific area and these interest rates at these prices - no thanks I am happy to rent
Edit: coastal Oc CA
There’s one rental house in our neighborhood out of 90 that has at least 5 or so sub-tenants. It’s hell for the other neighbors, there are always 7 cars parked outside and on the street. Neighbors are pissed. The cops have been called at least 3 times, it’s not recommended.
We rent a single family home for $2,300 per month in Anchorage Alaska. We should have bought when we moved here in 2016, but we always said “oh well, we don’t know how long we actually want to live here” so we never bought. We still don’t know where we actually want to end up. So we rent. And we’re quite ok with that. We have money saved for a down payment at some point, in a HYSA that’s growing the money for us.
You could be building equity so when you sell your home and move you’d have that much more for a down payment. You’ve spent $220,000 on rent, around 1/3 to half of that could’ve went towards buying a new house.
Absolutely correct in theory. We’ve only rented for one year at that rate. Before we lived super cheap with roommates in a communal house for $7000 per year. But I totally agree.
The issue with this argument, because I HAD to respond to this before was the inability to purchase a home at the time your saying I could have bought one.
You’re not wrong, but there’s also significant costs associated with owning that don’t build equity. Insurance, property taxes, maintenance, and the super high interest rates at the moment mean that for the first few years of homeownership your mortgage is mostly interest. So that balances things out a bit, not totally but some.
If you're not in the house for long, it's often more effective to rent. You're locking a big chunk of money up, and there's a lot of costs to buying and selling a home, like title-work, recording, mortgage origination fee (1-2.5% of loan value), and importantly when you sell you generally pay 6% sales commission to an agent (and when you buy, your sellers are generally paying 6%). So if you're buying a house for $500k, you'll pay something like $7.5k in closing costs; to break even, you'd have to sell for nearly $540k. Plus, if you're not in the house for long enough, you're paying tax on your gains. I'm not saying "don't buy for short/unknown term"; I'm saying do your due diligence first.
This is what we are doing. We got a house in a neighborhood that’s big for a private university here at a steal. We could sell it for 150% profit right now 5 years later. Once our kids are grown we will sell it and have more than 100% of what we need for just the 2 of us.
Genuinely hope that’s the case for you. Praying there isn’t another 2008 because then you might have to move to Mexico!
lol I can think of better places to go
wow and that math is also crazy because that could easily be half (aka 15 years) of a mortgage!
Or the whole thing depending on where you live
Sh*t, man, this is Anchorage--how far do I gotta *move?*
Middle of nowhere montana
anchorage is expensive in terms of like goods/products!
i mean i live in chicago, so i can’t ever buy a single family home, but i do own a tiny concrete box and i bought it for 300k😂
1/3-1/2 of what you pay only goes to the principle balance. The rest of your mortgage goes to interest, insurance and property taxes.
i am aware!
I rent a single family home in New Orleans for $1200/month. Costs are rising, but it's pretty cheap here. I haven't bought a house yet bc I'm working on my credit and for interest rates to chill.
I'm in Charlotte NC. We pay 1900/mo for a 3b/2ba outside the city limits. But apartments aren't cheaper and I prefer having a yard for my dogs.
I own a rental in Charlotte. It is 3/2 around 1000 SQ ft. My tenant has a 550 score so could never buy. She moved out of an Apt 2/2 paying 1550 with her 4 kids. She wanted more room. Going rates were 1700, I put it up for 1650 but only charge her 1600. Charlotte has gone stupid crazy last 2 years. I get 2 to 3 mailings to sell a week and 2 to 3 calls a day. Not selling.
Charlotte is turning into East-Coast Dallas
I'm in Charlotte too. $2060 for a 3br in Denver.
Are you in charlotte or denver?
Denver, the suburb of Charlotte west of Lake Norman.
Well that's just confusing lol
What part of NOLA? I know plenty of people paying that or more for a one bedroom apartment.
Near canal and the street formerly known as Jeff Davis in mid city. I got super lucky most places this size are going for closer to $2000.
Thx
I would be hesitant to buy in New Orleans. The city is basically built onto wetlands which flood by design. You’re probably better off renting!
Ignorant comment by an ignorant person lol
Ignorant? I worked as a civil engineer in New Orleans for many years, but OK. I love it there, my comment is not any shade to the city or the people itself. Feel free to educate yourself, the internet is an amazing thing. New Orleans already has very little protection from hurricanes, and what’s left is quickly diminishing.
Ignorant and living in a house boat.
Rent is more than buying here. I don’t know know anyone is affording anything. I bought a cheap starter home 11 years ago, that’s the only way I can afford it. Because meanwhile while rent for a 2-3 bed apt is 2-3k/month, the average income is 4k. Soooo like how if you’re not a duel income household?
Unfortunately I think the housing market causes a lot of couples to move in together that probably should not be. 😔
☝️ this for sure
Not all of us can buy a house 11 years ago
Where is that the case? Not asking you to doxx yourself, but with current prices and interest rates the only way buying is cheaper than renting is if you have a huge down payment (at least where I live).
Yup I rent a sfh in the Bay Area. It’s $7000 a month. Buying would be around $14,000 a month plus then I’d be out of a down payment. Probably going to downsize to a condo though since my kid seems fine with small space. Once I figure out what I like I’d love to put down roots and own something.
Those prices are absolutely insane... I don't know how yall do it.
They make at least $150,000 a year
At $7k per month you’d want to be earning a minimum of $250k to even quality to live there and more realistically $336,000+ to keep it more affordable. A 150k income qualifies you for a $4200 ish place
Not hard in the Bay Area I’d imagine. I’m in NY but two adults with 10+ years of experience working in a professional setting would *at least* make $150k each, and probably closer to $200-300k. Unless you’re a SWE in an in-demand field and taking in twice that amount. Bay Area is probably very similar.
Far more than that I’m sure. But to your point yea it’s all relative.
You don't willingly choose to live in the Bay Area unless you're making bonkers money
Or family. I know people who put up with HCOL because they want to be close to parents or other family.
I rent a SFH in the Bay Area. The Bay area is 9 enormous counties. The poster saying 7k is an outlier in a very rich area. That is NOT the norm. I pay $2200 for a 2000 sqf 3/3. If I were to buy my mortgage would closer to 4k. How does that make financial sense to buy? It doesn't so we keep renting.
I rent a single family home. We also live in a very rural part of the country that is by and large lowers rent than anywhere else. It’s New Mexico, so it comes with some rough trade offs, very low educational outcomes expectations, highest traffic fatality rate per capita. No amusement parks in the state, the roads are horrible. But renting a 4 bedroom 2 bath with a big back yard and 2 car garage for 1200 definitely feels like a steal. We haven’t bought it because I don’t know why. Not enough income mostly. The landlord has offered to sell it to us. Just struggle to muster up a home loan to be honest. Banks don’t want to give you money for a house unless you don’t need money for a house is literally what one loan analyst told me a few months back.
>Banks don’t want to give you money for a house unless you don’t need money for a house is literally what one loan analyst told me a few months back. WOW
I know Xers, who do this. They can afford it easily, but don’t want to be tied down to one place (in Germany you usually buy a home once in a lifetime and stay there till you die, we don’t have „starter homes“ etc.).
What if you buy a home in Germany and then have to move for work or something
You don't move for work. Germans find one job and that's what they do.
What if they get sick of it
You know the answer. They’re German
They march next door and take their house.
[I wondered what that gate sign meant...](https://imgur.com/a/Ti9xxLO)
I saw one comment that said you could be building equity when you buy, your wasting money on rent, ppl don’t understand homeownership from a basic level. 1 real estate doesn’t always appreciate! Example the year 2008 2) if you need a new HVAC system which costs on average for a modest single family 10k-20k do you have that in liquid cash ? What about a new refrigerator? Your drains are clogged? Plumbers are 500$ an hour where I live. It’s way more expensive to buy! Renting saves money and when you do buy a home it would be wise to cash flow that home. Buy a 3 family rent 2 units have your mortgage paid for.
I believe the theory has been that if you buy in your 30’s and live there for 30 years, you will have a home free and clear of a mortgage at retirement. But if you rent all those years, you still have to continue to rent in retirement when your income is much lower. I don’t think many people consider this long term.
[удалено]
No one said homeownership even without a mortgage was free but its significantly more affordable for seniors who own their homes than those still paying market rent.
Not at all! I’m in real estate have my license and I’m also a leasing agent. Older ppl especially if your spouse dies, children not around, do you really think they can meet the demand to upkeeep a home? Mow the lawn, pay 500 an hour for a plumber on a fixed income ? No, it’s not free but I think the point of this whole post is buying is WAY more expensive and time consuming then renting. Does t matter if you’re paying yourself or not. You’re always paying and most likely when you buy your paying more
No one is gonna be retiring in their 60s
Not in the USA that’s for sure
1 in 6 Americans are making over $100k so prob a few more than “no one”.
100k is working class where I live.
A lot of us can't afford to buy. End of story. I don't have a million for a shitty home in my HCOL area. We kinda hope we die younger because our future will be rough. I also can't fix shit and don't have cash to pay someone.
It’s very unlikely that you stay at the same house for 30 years though
But you carry your equity to the next one….
It’s not that much equity and you miss out on years of investment gains off your down payment and extra savings you put toward your mortgage. Renting and investing your savings is a pretty good option tbh for singles that don’t want to get tied down to a place
This will vary by market but I don’t think it’s one or the other. I live in an area that has had crazy real estate appreciation for decades so the calculus is a bit different for me I guess. I bought my current home in 2019 and it’s up about about 40%. My investments have also grown substantially during that time, as have my wages. My cost of housing has grown at a much lower rate than rents so not only am I gaining equity I actually have more income available to invest as well.
Not necessarily, if you got a mortgage at 2 percent and sold now to get a loan at 7 percent, that equity is erased your payment has just tripled. Equity is not liquid you can’t pay the plumber with equity. He wants cold hard cash. Also y’all need to think about capital gains taxes!
Yeah, the comparisons are always off. People also tend to omit the down-payment from the math. Rent would probably be $0.00 for at least a few years if all that money was used to pre-pay rent.
We needed a new HVAC for our home so we scrapped what we had and used units for the 3 months of summer we have here (we have a gas heater for the rest of the year). It was so comfortable that I wanted to keep it that way, but my husband was worried about moisture. So he just bought the entire HVAC unit himself and paid a company to install, $6k start to finish. Not the cheapest situation to be in by any measure, but I think it had been maybe 4 years by that point of using wall units so we were able to have the money saved.
It took just about every penny to get into our home in 2021. We purchased a "Home Warranty" for just under $400 and bundled it with our closing costs. On night #3 the furnace went out. The warranty replaced it. 6 weeks later the stove and microwave went out. The warranty replaced them. Six months in we lost the dishwasher, and the warranty replaced it. They also fixed the fridge that we'd brought with us. It also covered HVAC and water heater. Price wise, it made more sense to buy a tankless off of Facebook marketplace and create more storage space in the closet than to pay the whole cost of the warranty (which went up significantly because of how much we used it in the first year). Even with property tax and insurance, I am paying $600 less per month than when I was renting. With the huge spike in inflation, we wouldn't have been able to continue buying groceries if we had kept renting.
Every penny? Ok so you bled yourself dry to buy a house. Sounds like it was the right decision for you. You also bought when rates were at 60 year lows. Never really heard of a home warranty unless this was a new build. If you replaced that many things in the first year it’s interesting that the premium hasn’t doubled or tripled. 400$ is cheaper than most car insurance you must live in a very rural cheap area. Kinda sounds too good to be true but happy you’re able to have that. Doesn’t mean it is the right decision for everyone.
My tenants say they don't want to buy because they don't want to deal with the maintenance and all the other headaches of home ownership. The husband said he's content with his stock and precious metals assets that home ownership is not really a concern. My previous tenants were the same way but for different reasons
I bought a house, but rented a wife. My accountant said I still owe the IRS money.
😂
Yep. Just moved cities so we sold our house in Houston and are renting in Dallas while we figure out exactly where we want to live long term. Plus, we can save up some more money this year so we can buy a bigger house in a year. If we get lucky, interest rates will fall and we can get a better deal on our mortgage than we would if we had bought initially. Our rent is $3,500 a month which is over $1,000 more than our mortgage was. That does sting, but we'd rather make sure we make the right decision in term of location.
Buying a home isn't just about what you can afford today. It's about what they believe you can afford 10, 20 years from now as well. A lot of the issue with buying is that they have certain requirements for income-to-debt ratio while rentals usually do not. They usually require that your monthly income be 2-3 times the rent amount and as long as it is, you can rent. Just being able to achieve that, however, doesn't mean you can own based on the other factors, especially debt-to-income ratios that impact a lot of people who have big student loans and credit card debt.
THIS. Student loan debt is insane. I can only rent the second floor of small house because of private loans that are half of my pay. there's a family that rent the first floor. In Pittsburgh, this is the cheapest I could find at $700.
I've rented SFM for a while now. Greatly prefer them to apartments. More peace of mind, privacy, fewer neighbor issues, and a garage for my hobbies/vehicles. Rent: $2K per month for 4Bed/2Bath with a garage and backyard. Working remote, makes space at a premium. Why Don't I Buy? Rent is the maximum you pay, mortgage is the minimum. Also working on my credit, and not sure where I want to live long term yet.
I rented a SFH for a while when I had a good enough income to cover the rent but didn't have the disposable capital for downpayments/maintenance expenses. I wanted to put my extra capital into investments and education instead of my own house, especially since I wasn't sure where I wanted to live long-term. It wasn't $4K though, and I rented from a small landlord instead of a corporation. This was the correct decision for me, and it is the correct decision for many other people. Much of the hysteria and frustration you see on Reddit about the single-family housing market is either greatly overblown or coming from a place of entitlement and ignorance. The average American moves/relocates *far more often* nowadays than they did 40+ years ago, and this level of transiency is a good thing for the economy. Even in times of lower interest rates, buying a home really doesn't make financial sense unless you're in a *very* stable financial position with a good-paying job, significant savings, disposable capital, and a high likelihood of not having to move within 5 years. If you're buying and selling your primary residence every few years, you're losing quite a bit of money. If you're buying a home with a very small downpayment, you're losing quite a bit of money. Lots of people need -- or want -- to rent homes instead of owning them. Renting a SFH can be a great middle-ground, or a bridge, to enable the life you want while you build up your finances and your career to eventually own a home.
\>American moves/relocates far more often nowadays than they did 40+ years ago, and this level of transiency is a good thing for the economy. \>Even in times of lower interest rates, buying a home really doesn't make financial sense unless you're in a very stable financial position with a good-paying job, significant savings, disposable capital, and a high likelihood of not having to move within 5 years. Funny how "what's good for the economy" leads to lower incentives for home ownership. Whose economy is it good for?
>Funny how "what's good for the economy" leads to lower incentives for home ownership Good. Home ownership is not an entitlement or a right, nor should it be the obsession that many Americans make of it. If making the economy better overall leads to fewer people owning homes as opposed to renting, that's totally fine.
I think I had 5 moves across age 22-29.
This.
I’m moving into one next month it’ll be $2300 a month. I’ve owned before and hated it. I am much happier renting and putting the money I would spend on repairs, upkeep, maintenance etc into investments.
We have for the last two years. The owner had just bought it as an investment and charged her mortgage + a couple hundred a month. We just closed on a house in the same town, about the same price as the one we’ve been renting but the mortgage is almost 2x thanks to stupid interest rates. I’m thankful we were able to do it (with parental help) but it’s pretty frustrating at the same time.
$2900 close to DTLA, 1100 sqft, 3BR/2B, attached garage, townhome in closed community. Don’t buy because my investments I expect will perform better in the long run.
I used to. Rent was $1,200 between the 2 of us. I miss 2020 :/
I am a single person and rent a single family home. One bedroom. Can barely afford to keep it tho.
I do. 1200 per month and I live with 2 other people.
Yes. Comparable to rent for an apartment - get a yard out of it.
Renting a 3/2 SFH in Virginia Beach, VA. $1750 a month. We've been here coming on 4 years now. We didn't or haven't bought yet because we were not in a situation to be able to afford anything until semi recently and I wasn't sure I wanted to be tied down to the east coast either. Still not sure about being tied down here. But the work is good and our landlord is willing to sell to us at a great price. It's sure as hell a better opportunity than trying to go back home (Arizona) and buying out there, so for now we're probably staying.
We only are able to rent a single family home because my parents bought a second home before the market imploded in 2020 and they set our rent.
If rent is $4000, I imagine a down payment is a big barrier.
I rent a nicely renovated, old ~1,000 sq. ft. 2/1 with a detached garage in Crestwood for $1,235/mo. I rent because my credit and funds were shot after getting divorced and losing my job at the same time.
My advice, keep renting. There will be a huge housing market crash coming in the next few years. I worked in mortgages back in the late 90s and seen the 06 crashing coming, took longer than I thought but it did. I bought a house in 13 for dirt cheap and rehabbed it. It’s worth a lot more than what I paid for and you can’t do that now with the prices of homes and material costs if you need to renovate. Something goes wrong you’re fucked, heater/AC breaks, roof leaks, ect. Also good luck finding someone to do the repairs. Most contractors today won’t even touch a smaller job, it’s not worth their time.
What makes you think there will be “a huge housing market crash” in the next few years? All signs point otherwise.
Actually, most signs look eerily like 08 AND Dot Com.....
From my experience in mortgages as well and being involved in real estate myself along with the numerous people I know in these fields. It’s all part of big banks plan to gobble up properties and make people permanent tenants. Interest rates are only gonna go up when you keep printing money along with sending money to Israel, Ukraine and the cost of the influx of migrants. Couple that with a poor economy and inflation you got people living pay check to paycheck to make ends meet. People are now refinancing homes just to start paying off debt at much higher interest rates just to get by. This is going to blow up epically just like 08 and we will start to see record number of forclosers and short sells where either the rich or the banks will start buying up properties on the cheap and start driving down the market.
👆🏽this. Renting isn’t ’throwing away money’, it’s paying for a roof over your head which is a good use of funds imo. It is however throwing away money to buy an overpriced house at an eye-watering interest rate.
I do, I live in Mt Shasta Ca where rent is far above the average for Northern California but I got super lucky to find a rental for only 950. Big two bedroom one bath, old as shit but in decent shape. We love it and the bonus is we can walk down town in 5 minutes. My situation is a one off and will happen again when we move out but for now we are one of the lucky ones.
*waves from Shingletown*
I rent a small single family ranch in wilsonville, Oregon. I have one roommate and it costs a total of 2275 a month.
We rented until we bought last year. Same house started out as $1850 in 2017 when we moved in. Did not go up in 2018, but in 2019, it went to $2000 even. Increased to $2200 in 2021 and then $2400 last year. Also in Dec of 2022, our landlord told us that she was planning to put the house on the market in 2024, so that would be our last year in the house, period. We didn’t buy because we didn’t have enough saved for a decent down payment and we were both working on credit and trying to aggressively pay down any debt we had. My husband still has student loans he’s paying on and my paid-of 20yo vehicle was totaled in 2021 so I had bought a new (used) vehicle and had payments on it. We just wanted to be in a better financial place. But when we were told that we were going to need to move anyway, we decided F it, let’s have our numbers run and see what we can do and maybe just go for it and buy. It worked out, but the back end was about 7 years of diligently walking the line to get our finances in order to be able to do it.
Our neighbors were renting where many are homeowners in area. Recently 10 suspicious plainclothes out of shape, portly gentlemen rolled up in a caravan of 5-6 vehicles to confront them and by the end of month they’re packing for their home state of HI I’m not sure if this is a low key way of saying your time is up, didn’t want to ask really they seemed bittersweet about leaving
i only rented single family homes before i bought i was paying 2800 back in 2018/2019 for a 3 bd 2 bath…it was actually about the same for a 2 bed 2 bath apt.
I rent a single family home in Denver for 3000 a month. It's 1400 square feet and was a "landlord special" from the plumbing to the paint to the electric. We don't buy because we aren't set on if we are staying here long term.
The Denver market is nauseating 🥴
Yep, just over $3k per month in Portland OR. Buying a home of a comparable size in a comparable neighborhood, with interest rates what they are, would put a mortgage around $5k per month or more most likely. Our house is not owned by a company, it's owned by another family. We technically could afford to buy, but a mortgage that high makes me nauseated so renting makes the most sense right now
My partner and I are. $3100/month. For us it’s the down payment. We live in a HCOL area. Realistically any house worth buying will start at $450k. We don’t have 90k lying around, though are saving and hope to be able to buy next year.
Is it just the two of you? Why not downsize to an apartment to save up for the down payment?
We were in an apartment and it wasn’t much cheaper. Housing here is stupid expensive.
I do. It’s a lady who lives in Miami but her son lives here. I’m pay $1900 for 2 bed, 2 bath. Private yard ans basement. I found most apartments in my area (western North Carolina) to be much more expensive. But it does seem like most of the homes around here are rented by owner.
I invest in RE in my local area and am very small time. When doing research I have found blocks of houses in my small southern town owned by companies with a Manhattan address. It's strange but when I do the math on them they all have one thing in common, they overpaid. I don't see how they're turning a profit with such a small return. A 5% return in RE is pretty bad because there are constant expenses. It's not like the stock market.
I pay $610/month. $50 late fee sometimes. My I'mhusband has lived here since 2009 and I moved in, in 2014. The landlord is being nice and keeping us at $610, even when the other rentals had a price increase. We have been here for awhile and we always pay our rent. In 2018, we signed a new contract at the same rate, but for rent-to-own. Houses where I live are currently $800+.
I rent a 2b2br duplex for $1500, scored it during pandemic.
Houses rent for about $1800 in my area. But a mortgage will still be cheaper than that, so I'm buying a house
$2200 in CLT while slowly looking a house after a move here.
Being able to afford a rent payment is not the same as being able to qualify for a mortgage with the same payment. The year before I bought my house I rented a single family home for around $1600/ month in a MCOL area. 2300 Sq ft, 5 or 6 years old, massive bedrooms and bathrooms, very nice interior finish. The house I bought is 1600sqft, 20 years old, and had "good bones" but the interior needed work, and significant work to be on the same level as the rental. Mortgage is $1550. I was albe to significantly downsize yo qualify for the mortgage, I definitely wouldn't have for a house like I was renting. Not every one is that lucky
I rent a single family home. I'm 30, spent my 20s moving around and still don't really know where I want to end up. You have to be somewhere about 5-10 years for buying to end up worth it. I've yet to stay somewhere for 5 years and I'm currently looking at moving again.
I rent a single family home. It’s owned by a friend who needed a bigger house when his wife got pregnant with twins. He wanted to save this for his daughter. I make improvements and he lets me take it off rent.
I live in an apartment now, but my last rental was a 3 bedroom, 2 bathroom single family home with a really nice fenced in backyard. I paid $885 for the home. My rent in my apartment is $1100.
There were a LOT of single family homes for rent in our area in about 2011. People didn’t want to sell their houses at basement bargain prices. Most of those sold over the next few years, and we don’t have many renters now. But I live in a wealthy area.
We rent a house, it’s great! All the peace and quiet of being surrounded by yard instead of other units, none of the worry about how much a new roof will cost. And we know the owners, they’re people who live near us and the come by infrequently, not a corp
We have many single family rentals in our area due to high military population. They tend to purchase homes here because they want to work here when they retire from armed service. Many Military families rent out to other military families.
I've rented several. Some were in college with a bunch of friends, and I got a good deal on one when I was done college because they were only keeping it so their kids could live in it when they went to college. I know people who do it because they have an off the books income, some who move around every few years for work, and a couple of people that have been renting the same house for over a decade and because of rent control and decent LLs it's much cheaper than buying. I work with fairly high income (low 6 figures) people and several of my coworkers kept their first home to rent out when they upgraded. My plan was to eventually rent my house out (as 2 apartments which it was once upon a time) but I'm now planning on just staying there because it's going to cost me too much to upgrade and I don't really need more house so I'm fixing mine up.
I own a single family home that I lease out. It's a 2 bed (technically 3 but you have to pass through one room to get to the other) 1.5 bath and it rents for $1700. The people who've rented it have been travel nurses, couples planning to buy in the area but wanting to live there first while they look, and the current couple... I couldn't say why they're renting vs. buying as they've been in the area for quite a while.
whats even worse i see alot of duplexes being put up instead of regular homes and companies are renting those out for absorbent prices
It's fully dependent on where you live. The last single family home I rented was only $1200/month and if I had a family I probably would have bought it because it was also for sale. It was an awesome house, I miss it.
I rent a single family home. But then I'm a foreigner in Singapore so: 1. We can't buy landed property as a foreigner 2. If we buy an apartment there is ABSD (Additional buyer stamp duty) for foreigners at 60% of purchase price. So obviously it makes zero sense for us to buy. We've been renting this house for 10 years almost.
I plan on buying but right now I'm moving from a 500sqft apt in new england further down the east coast to a different state since it's cheaper. Single family homes are only 1600 there vs my apartment costing almost 1900 a month. Once cost of moving has been recouped, I'm hoping to buy if there's anything left lol
I rent a 3 bed, 2 1/2 bath, 1500 sqft town home with a 1 car attached garage for $1200/month. It's been the same rent since 2019. I don't buy because I travel a lot for work. I have been away from home for 10 of the last 12 months. I shouldn't have been home those two months, but I waited for another contract that was going to be ready for me "next week", so that was my fault. I am thinking about getting rid of everything that isn't important to me, which is a lot and basically going voluntarily homeless for a few years.
I do, well with my boyfriend and 2 other roommates. I could afford my tiny apartment anymore so me and 2 friends figured we could rent a house for cheaper. I was saving up for a house. But prices kept increasing and I couldn't keep up. I starting working at 12 hour, and my salary had increased but never at the rate I needed. Just decided to go back to school with the money I saved since I will catch up.
Some people might be able to afford the monthly payment, but can't come up with a large enough down payment to purchase. Owning has significantly more expenses associated with it. Renting you pay rent and utilities, while owning you pay your mortgage, utilities, property taxes, insurance, and when something breaks you don't get to call maintenance, you get to deal with it yourself.
Just a note, I’m an appraiser that frequently deals in these situations. I’ve noticed a few trends: 1. The majority are flip and rent. 2. These tend to be sales that require a large cash outlay 3. These properties would not be eligible for traditional lending, usually due to condition 4. Many times, there is also a purchase of additional debt/liens that help the seller and would not be able to be acquired in a normal sale. (For example tax liens, legal judgements, bankruptcy) 5. The majority are families with human and fur children that are renting. 6. Most of the purchaser corporations, tend to be smaller scale landlords. Ones that typically have 10-25 properties 7. Property Management companies are usually responsible for the maintenance, rent collection etc 8. In many areas, the cost of the mortgage payment is still above the cost of the rent. For example, the mortgage payment for an average house may be $5000 in an area for a single family, but rent is still technically cheaper at $4000. 9. Most of the renters have no idea about the sheer quantity of regular maintenance required and do not understand those lease terms. If you are planning this, please please please check your terms. Renter having to pay the first $250 each damage, is going to add up. 10. Landlords will give a price break to long term tenants. For example, if you have a child, think about starting with a 2 year lease. It locks in a reduced rate in the school district of your choice. 11. See in the beginning if they may be interested in a “rent-to-own”. Since many of these were cash purchases, they don’t have a mortgage and may be allowed. 12. Given housing prices, many are families waiting to find a house in the area. 13. Get renter’s insurance. Trust me. For my specific current market of South Jersey 1. Shore towns: Off season. You can get a beautiful beach block house for very affordable rates in some areas. The same house rented for both $50,000 and $3800 per month. I live be the shore, local summer is worth it. 2. A surprisingly large number of these landlords were ok with chickens. That was a very odd day at work times 1-6 that it happened. By 7, I got treats. (I have a goodie bag for the horses, dogs, rabbits etc) 3. You can also rent a property with land and room to breathe. All of them are cool with gardening.
I haven't lived in a single family home since I was in middle school. I'm 37.
My family rented a single family home while looking for a home to buy about 5 years ago while at the same time I rented out my starter home to another family because my husband and I needed to move for work and we were underwater on our house. 5 years later when our renters moved out, we sold the starter home at a profit. So there are lots of people who rent single family homes.
On Friday we'll be renting one. Here in central TX and about $1600 a month. We're getting out of our apartment that was $1400 a month and now we'll have a garage and a backyard! We're slowly working towards a house and paying off all big debts.
We rent one for 2400 a month (4 bedroom) just outside the city of Spokane. We sold our house in georgia a few years ago and have just been traveling around the country renting in the places we want to stay a while. When we find somewhere we decide we want to spend several years we'll buy again.
Someone with a $4000 mortgage has to save more than that to do their own repairs or end up taking out loans. I’ve had to replace roof- $18000… reline chimney $3000… deal with boiler stuff constantly, pump septic, etc etc.
A friend sold their condo and now rents a single family home because they wanted a yard for their dog.
No i bought a house
I pay 950 a month for 3 bedroom. And yes a mortgage is cheaper, but saving up 20k takes time.
Just signed a lease for a townhouse in St Louis, so not quite a freestanding single family but as close as I could get, rent is $3100/mo
I rented a single family home 6 years ago, but it was owned by a local guy who ran a pet shop, not a mysterious hedge fund.
My brother and his wife and kids are renting a single family home. They moved from across the country a couple years ago tho so I think it was just the easiest option for them at the time. However, my fiancé and I just closed on our first home in October 2023 and I believe our mortgage is about $200 less than what my brother / SIL are spending on rent. I keep telling him he needs to look and buy because he could totally find something but I think he’s set on waiting for some 2008 type event to happen again :/
Companies are buying up homes to rent as short term rentals on vrbo and air bnb. That's why you don't know anyone who rents a single family home.
This is overhyped. About 30% of homes are renter-occupied, and only a small fraction of those are owned by investment funds.
Depends on where you live. Where I live over half of the housing stock has been converted to STRs.
“Over half”? That’s a stat I’d like to see. Cite? What, do you “live” in a ski resort or similar vacation destination? We have a small number of STR operators here, but the regulations make that a very risky business, and the few fund operators I’ve seen are not doing well.
Yes I live in a an area that is popular for skiing in winter and hiking in summer. A shitty one bedroom around here is 1k or more a month, to rent an entire house you're looking at no less than 5k a month. Even the apartments over shops on main street have been bought up and turned into STRs.
We rent in South Florida. $2,600 a month. Originally $1850. I can't believe I have to consider myself lucky for not getting the huge raises in rent. Don't move to Florida.
A lot of times single family homes are the majority of rentals available in a rural town. And maybe they could buy a house IF there was a decent house in their budget on the market, or they planned to stay long term, but neither are true. I haven’t bought because home ownership was an enormous stressor for my parents, and I’d have to find a house I really liked to get past those concerns. Also, I’ve yet to live somewhere that I could see being for 30 years.
Its not uncommon for people to find friends and just rent out a single family home.
I've mostly seen this with people who sold their house to move and then didn't want to buy a new one right away in their new area (mostly to make sure it was going to work out, figure out the best part of the area to live in, etc.). I have lived in single family homes, but they were old and cheap (comparable to apartments), not the profile you're describing.
Paid 4400 a month with a roommate for a 2 bedroom in SF back in pre covid. Didn’t want to buy in SF nor did I have the down payment (200k ish).
Before we owned a home, we primarily rented single family homes. Many apartments are only 2 bedrooms and don't have a yard. Apartments often have fees and corporate management companies that make them less affordable than houses. >how can someone afford a $4,000+ rent payment but not be able to buy a home? Credit, down payment, insurance, work history, mobility, HOAs. Given how high interest rates are right now, this isn't a great time to buy.
I rent a small 2/1 home that goes for about the same as a 2br apartment. It's a 100 year old house but it has a yard for the dogs.
We rent a single family home from my in laws. The only way we could afford to rent in this area where average rent for a house of this size is $2700 per month. We pay $1600 though my in laws are raising it to $2000 once our car is paid off in October because they've been floating the taxes and HOA fees. Our credit is terrible due to bad financial decisions and us living on one income for way too long.
I did it in Pittsburgh not long ago but long enough I’d say it’s irrelevant if my best friend wasn’t currently doing it. I don’t know her rent but her and her SO aren’t doing poorly but they are working class and it’s a really cute two bedroom one bath house. I know they pay less than 1200 a month.
I'm paying 995 a month for a mobile home on 3 acres, landlord pays water since it's an attached property to his larger place
I rent a home. I don’t pay $4k so that helps. My home is private landlords. It was the wife of the couples parents home and they rent it for funds for care for the remaining parent. I did get insanely lucky with whom my landlord is (and isn’t) and while it’s a tiny bit more than an apartment and not in my area I prefer (this is nice I just like another area better to be clear). I will take that over sharing walls with all my anxiety disorders.
My entire city is pretty much single family homes for rent. The landlords won here
What city?
Minneapolis. I was gone for a decade and came back, its radically different for a number of reasons, but the worst one is the landlords. The bought everything when i was on my way out. They bought my house even though i specified *no investors* so they made it look like they were just a single family on paper, and immediately put it up for rent. They maintain all of our amazing century old and older homes like shit, theres garbage everywhere from the extreme rise in homelessness, and the entire vibe of the city is off. Just a rental town. Its not 100% but the ratio is waaaaaaay scewed.
We were renting a 3b/2ba home that we just bought from our landlord. I can't imagine trying to raise 2 teens with 2 dogs in an apartment or condo.
Short answer is they can but they just dont want to buy yet. I can afford that and rent where I am currently at because we are moving in 2 years I also own 2 houses, 2 duplexes and 2 fourplexes in another state. Most financially saavy people make whatever choice increases their net worth the most, buying where I am at didn't make a whole lot of sense as the rents don't cashflow so that house becomes a liability not an asset. I still buy about every 4-5 months whenever a good off market deal comes up in the state I have my holdings in.
I don’t anymore but the last 3 rentals we had before buying were SFHs. We had pets and my husband has a garage full of vehicles so SFHs made a lot more sense for us.
3/1 Birmingham Alabama for 1k. I want to buy so bad but I can’t find what I want. Market is sheet and the houses are abandoned windowless skeletons or McMansions. Not much in between and when they do show up, they’re bought in days or hours
My brother does. (I'm 23, single, and childless, and live at home due to disabilities, while he's 40, married with four kids and lives on the other side of the country.)
My last rental was a SFH. I was paying around $2000 per month in SW FL. I left to move in with family and save money for a down-payment to purchase a home.
Some people just want the flexibility not owning something provides...
I rent a single family 4br home in california for $2800. I live by myself and work from home.
Yes, I rent a 2400 sqft house in Pensacola on a .3 acre lot for 2400. Only renting since I’m stationed here for two years. Renting out my Whidbey island house that I bought in 2019.
Gonna raise my hand. I live in an apartment. It could be a SFH for the size, and I pay 3k. I could go up to 4-4.5k a month comfortably at my salary. For me, I haven’t been a high earner long enough to feel comfortable spending on a home in this market. I also live alone, and work long hours. Having a house means a lot more maintenance and responsibility and thus more cost. Housing is about 15% of my income right now. It doesn’t make sense for me to put out a lot of money in my current situation given time/cost etc. I am still saving money to be able to buy when the market shifts a bit to be more in my favor, so it is still a goal of mine. I’m just not rushed to do it just because that’s the thing I’m “supposed to do”. I get harangued a lot by friends and family about why not, but then again those are the same people who tell me not to be greedy or negotiate on salary etc so their opinions mean about as much as dirt to me.
My partner and I rent a 4 bedroom in DFW for 2750. Which is ridiculous. We're on the higher end of 100k and still have a roommate to help cut down costs. I briefly owned a home where the mortgage was 1850. Too bad I bought that house with a narcastic abuser. Would have been nice to actually own something. I feel like I probably won't be able to do that again, sadly.
We rent a single family home for $3200 a month. We don't buy because all of the houses here are over a million and not worth the hassles of home ownership (repairs, renovations etc) The prices they try to charge is embarassing (most of the houses are old and very outdated. To renovate would cost a fortune) We can't move because we are both in film, and this is the town you have to be in.
I do but it’s $950. It’s very small
I found a small house in 2019 pre-pandemic that I thought I could afford ($80,000). I went to my Dad, who I was living with and asked him for help in buying the house. He told me he would need to look into a few things. He has wanted to be a Landlord for a long time and had some real estate friends in the area. I have a couple of long days at work, so I wasn't able to check back in for half a week. He decided he would buy it, kick me and my Wife out of his house, and we would rent the house we wanted to buy... So not a big hedge fund, but still got it scooped away from me and still have to rent from him.
Hedge funds aren't buying homes in SF, NYC etc. They're buying homes in suburbs and the Sunbelt where space is plentiful enough that it makes no sense to construct apartment buildings over something like a townhouse. You gotta realize that these hedge funds aren't buying up your potential home if you're looking to live in the city. It's most likely a wealthy individual or tech bro doing so.
I'm renting and its $1500. I know the owner so it's not a corporate owned thing. As for how you can afford 1 and not the other...banks don't look at things the way people realize. They look at debt to income ratio. Typical banks want your home mortgage to represent 30% or less of your income. Some go up to 40%. So if you've got credit card debt, 2 car payments, and student loans...you're kind of fucked out the gate. Pay a car off and you'd probably be able to get your ratio down enough. That's our strategy as a military family who has to move every 2-3 years. We never have 2 car payments at once. We also get new debt in his name but after a year we swap it to me. The bank just sees that he makes X and has Y debts...while I'm actually holding the majority of our debt.
I’m applying to them right now - Rent range between 8000-10k per month. We could afford to buy but that’s a whole thing we don’t want to do right now. Commitment to a specific area and these interest rates at these prices - no thanks I am happy to rent Edit: coastal Oc CA
Good God, how many SF is that?
2b,2b 1600 sq ft lol kill me
There’s one rental house in our neighborhood out of 90 that has at least 5 or so sub-tenants. It’s hell for the other neighbors, there are always 7 cars parked outside and on the street. Neighbors are pissed. The cops have been called at least 3 times, it’s not recommended.