No - that's taken into account. I'm paying the landlord for a service. As well as the ability to use my cash elsewhere to make a bigger return.
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Replying to @theSamParr @TheHustle
If you’re paying your landlord your cash, how are you also using it elsewhere?
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Replying to @micronautica @TheHustle
This is basic math. You have $200k in cash. You can use that for a 20% downpayment for a house or invest it elsewhere. According to 100 years of data, investing it elsewhere while paying rent will likely make you more $$$ in most home buying situations.
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You do NOT need to do 20% down. 3% is fine. That is a HUGE difference.
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Right - then you're monthly payment is just bigger.
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Replying to @theSamParr @AlwaysBeHustlin and
And you pay PMI. The large majority of your payments in the first few years are interest and PMI. You’re practically renting. $300k mortgage, 3% down, 750 credit score, no HOA: only 33% of your first payment is principle.pic.twitter.com/U5X3My7514
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Replying to @hfchild @theSamParr and
You’re renting. You just happen to be renting from the bank instead of a landlord.
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Replying to @hfchild @theSamParr and
That’s not true. Rent to landlord = no ownership accumulated “Rent to bank” AkA mortgage = ownership accumulated
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Replying to @AlwaysBeHustlin @theSamParr and
Agreed. Some ownership. But considering you just paid thousands of dollars in closing costs, and will pay $18k (6%) in commissions when you sell - you’re upside down for a long time. Couple this with the fact that the avg first time home buyer owns their home for 3 years.
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Replying to @hfchild @AlwaysBeHustlin and
Not saying you shouldn’t buy. Just saying it’s a poor financial decision for most younger people. It’s an emotional decision. The money “lost” is the price of having security, a place that’s yours, etc. 2 yrs ago my landlord moved back so I got kicked out. We were devastated.
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Yes. That's my point. Buy if you want. But if you look at 100 years of data, it's not the easiest/best way to make $$$.
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