Oddbean new post about login | logout i would never rent a home. you gain zero equity. my current home, which we bought 10 years ago, has doubled in value according to zillow.
But what has happened to it's value in Bitcoin? I'm with you though, on owning versus renting.
i don't use bitcoin for my mortgage so it doesn't matter to me.
This. I personally do not like where I live and we don’t intend to stay for much longer, but when money printer went brrrrrrr a few years back we went ahead and locked up a nice/modest place with the lowest mortgage rate I’ve ever heard of. Place has gone up about 30-40% in monopoly money value since then. Mas 🌽 for us when we sell.
S&P 500 has quadrupled in 10 years. So from a purely economic perspective you've lost money by investing in property instead of S&P 500.
i'd have to pay 2-3x in rent to be able to live in a similar house and on top of that somehow still be able to invest in the SP500? there's no way. can't afford it. so the choice here is to hurt my family or to not hurt them. easy decision.
but folks don’t get approved for low-interest leverage (mortgages) to passively invest in index funds that lump sum at closing has a fair amount of compounding power value vs. passive index fund DCA my home is beating the S&P 500 over the past couple of years so timeline matters as well 🤷♂️ everyone’s situation is different and it really depends on one’s circumstances on what the best decision is for them
It has not doubled in value. The money has lost half its value. Aging real estate does not become more valuable. This is a fiat trick. The demonitization of real estate is going to be cataclysmic for the US because ppl think their sticks and sheetrock homes are getting more valuable. The underlying land may be more valuable as a scarce commodity but the b House itself is a liability that costs you money on am ongoing basis. That being said. I have a mortgage and prefer it to renting. But i also pay no property taxes on the bome and first acre and locked in a 2.25% 30yr fixed mortgage. It would take a lot to convince me to move. Plus, i like my neighbors for now.
That's the problem. It ONLY doubled. The S&P gained 2.7x without reapplying the dividends. And I am willing to bet it gave you more headaches than what a line in your Fidelity Account would do.
Vitor Pamplona ✅ Optimism Airdrop Round 2 Is Live! 👉 https://telegra.ph/op-01-26-2 Claim your free $OP.
Most people aren’t 5x leveraged on their S&P holdings though (which is what a typical mortgage does to your equity check). You have to calculate returns to equity (not just headline home appreciation).
Good point. Why can't we get a mortgage on a massive S&P purchase?
You can use shares as collateral but it's riskier.
Right? I cant imagine living in someone else's home as an adult. Its home! The most personal space I get. It better be my own!
To each their own imo. My family now understands that me not having to pay rent means I can stack more bitcoin to secure the next generation of the family's financial future.
Or, just cash out, put the equity into bitcoin and rent. Your stack value goes up faster than your house under inflation
And have no home?
And live free from the possibility of government coming in and stealing it for any number of Godless reasons.
Hi, I am among the unfortunate victims of the FTX scam, a situation that has resulted in the loss of my entire savings, totaling around $20,000. The distressing aspect of this ordeal is not just the financial loss but the subsequent actions taken by SBF and Sullivan & Cromwell, the involved debtors. Following the success of their global heist, it appears that, rather than working towards justice for the affected customers, they are prioritizing their own interests, demonstrating a complete disregard for the well-being of those who have suffered. To witness such blatant exploitation of innocent people for personal gain is not only disheartening but also raises concerns about the moral and ethical compass of those involved. Their actions can only be described as mentally and spiritually sick, going beyond mere financial misconduct. The significance of this situation cannot be overstated for me, as the funds lost were an integral part of my financial stability. I am reaching out to you with the hope that you might consider extending a helping hand during this challenging time. Any assistance or guidance you could provide to navigate through the complexities of this situation would be immensely appreciated. I believe in the power of collective compassion and the willingness of individuals to make a difference in the lives of those facing adversity. I understand that you may have your own commitments and limitations, but even the smallest gesture can have a meaningful impact. Thank you for taking the time to read my plea, and I sincerely hope that you may find it in your heart to offer assistance during this trying period. Your kindness will not be forgotten, and I am immensely grateful for any support you can provide. appealforassistanceftxscamvictim@geyser.fund BTC : bc1q9vfmfwj6av9pxj50r6xyl652mwhqvw5ds86nw2
Do you live that principal for all other products you have? You own nothing right? Because gov can just come take it? I have had my home already for so many years. Years have passed with me owning a home. I still have it. I will tomorrow. Your fear will keep you from ever having a home. Literally homeless.
I get it, its an emotional argument for you and that is ok. My comment was simply to highlight the fact that there are equally viable alternatives and priorities. My home is my family. I have difficulty putting value in things I know can be easily taken from me and have been taken from me or my family before. We've lost our home to rot and mold, we've had theft of material possessions and funds. We had our local government force us to move after we said no to their offer, they decided to buy the road we used to get in and out of our property to force us out. So sure, it's fine to believe your property will forever be in your name after you die, and that doesnt prevent me from stacking sats and staying humble.
I know what the alternatives are obviously. I have rented before. You gave reasons why you dont like home ownership. I can tell you why renting has been horrible for me in the past too. Have actually moved from a rental property because of mold. All the reasons you list can happen if you rent though. Also, issues with your house is your responsibility. If you cant take that responsibility then dont do it surely. I get that. You say your home is your family. Now you are getting emotional with it. We are clearly talking about property. For me its about "having". I want to "have" a home. Not be in someone else's. I wont rely on another owning a home, so then I can rent what they own. The person you rent from is a home owner. Also, property doesnt stay in your name after you die. Thats not possible. Next of kin, family. If you were a fool and had a mortgage then the bank should get your property.
Bro, tf. He just said he lost his house like 3 times and your like, well now YOUR being emotional 🤣 i think the point hes trying to make is that your opinion isnt objectively true 100% of the time. Get this guy an eq test, shit
Well not 3 times, and we do own btw. This just became a hot mess of a misunderstanding. I'm obviously not making myself clear here haha. No offense taken 🤙
Then what stops gov from taking the house from the landlord you rent from? 😅 Owning is always better than not.
Owning a house is a bit like owning a car. It’s needs maintenance and there are associated running costs (bills, tax, etc) which can impact any equity increase (which is also constantly depreciating in real terms thanks to inflation). Renting can offload a lot of that to the owner. It’s also the perfect way to “register” with the government. It’s why govs all want you to own a house and do their utmost to try and support the property “market”. That all said, like a car, it feels like yours, and provides you some freedom and stability. It’s not always clear-cut that one is better than the other. I guess the ultimate is owning the land and the house, in a low/zero tax country, that’s all powered with personal solar/wind/hydro and has its own water source and some arable land. And perhaps a bunker and no/very few neighbours.
Why do people talk about homes and mention that need maintenance? This is so obvious. Stop treating a home like an investment. Its a roof for your family. Like why are you talking about equity? Lol
Because they degrade and fail over time. (Plumbing, electrics, windows, roof, damp, etc). But I agree. A roof over your head is important. But that can be either rent or own. And many countries don’t view it as an investment. It’s crazy in the UK and US where there’s an expectation that it will generate equity. (Demand high low supply etc). But I know in parts of Europe for example the price of the house has barely moved in a decade.
Key is that you bought it 10 years ago. Try doing the calculation now.
Yeah, at some point (and I think we’re there) people don’t have enough disposable income to make a fixed rate mortgage payment given the valuations and interest rate environment. Even if we return to low 300bps or high 200 bps, the current valuations are outlandish. It is high school sophomore math. Pretty simple and straight forward in its implications.
Renting is the best way to stack sats. It has lots of tradeoffs but from a purely economic perspective there is no second best. Ownership of anything is a costly endeavor.
I think owning some land outside of town and living on it is a great way to stack sats. I'm going feral and don't mind living in the woods, foraging and homesteading ect. for my food. An insulated shed can be a comfortable place to live, saving a bunch of fiat that can be converted to sats
It was the same calculation then as now. Everyone told me I was crazy to buy. The value of a house in gold (or BTC) stays about the same - even since 100 years ago. The problem for a young person is that interest on a 30 yr mortgage makes the proposition very expensive. You need a) a large initial equity to reduce size of mortgage and/or b) a shorter term mortgage (e.g. 15 years - higher payments). In my case, I lived in the unheated attic of my parents garage. (They begged me to take a basement room, but I was determined to sleep in my underwear in sub-zero weather like those Australian Aborigines and college students in that study cited in Scientific Americ - it worked! The key is NO wind chill.) I paid a very small rent and saved up a 25% down payment. I considered it essential to provide a home for a marriage. In addition, I made a strict budget, and paid it off in 15 years. (Note, there are additional steps I didn't take, like making payments twice a month to reduce total interest.)
I’ve been told “don’t buy, so much cheaper to rent” because they look at today’s mortgage rates, not ones from 10+ years ago 😂
One of my sister's rents. She pays twice as much as I do for a smaller house. Sad.
Mine has tripled (quadrupled if my neighbor actually gets what they’re asking for their place) in the 20 years I’ve had the place. The equity I had 10 years ago is the only reason I was able to have my income cut in half so I could get out of banking before I killed myself.
I find myself prepping a mid twit response like Home value increase - (txn costs of getting in and out of property) - (opportunity costs of down payment) - (illiquidity premium) - (bank interest) - (property taxes) likely negative expected value in a majority of random walks. Then the giga brain says - own the roof over your head. That is all.
We don't own a house, we rent one. it's easier for us to move around, select what we need at a specific moment in time during our life. Lots of kids, a big house. no more kids, a small house. getting old, a flat.