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The huge negative of renting is that you're at the mercy of the property owner to raise the price when they wish.

So here’s what this video isn’t talking about. If you live in an area where home values increase, even in a 3 year span, you could be looking at a 20% increase in value (very reasonable estimate). Your closing costs are not 20% of your house. It’s like 5% so realistically if you pay off 10% of your house’s original value in 3-4 years (you can easily do this while staying below the average rent rate in your area) you could be looking at 25-30% equity in your home. Say your house is worth 260k. When you sell, after closing costs, you will probably have 40-65k of equity. And that’s with $0 down. You would essentially also get your down payment back in this scenario so if you put 20% down, you now have 80-105k in equity to put down on your next house. Or you could have a property management company rent it out

Depends. Remember renting money is basically disappeared. But buying, it gets added to the houses equity (once interest is payed) so if you ever move, you can get that money back outbuildings selling or, through refinancing.

Rented for 1430 and they raised our rent to 1600 after one year. Moved and has to pay expenses. $1530 for this one, 1645 after 1st year, they are raising rent again to 1832. We are in the process of building a house for 2300 a month. Too expensive. Live with your parents as long as you can. Good luck future home owners

I've heard of someone with excellent credit getting a mortgage on a manufactured home since it was so much cheaper. They depreciate so it's rare banks will do this. Most clever (but illegal) I heard was someone renting an office building and living there. He found a place with a shower and kitchenlet and disguised it.

It gets even worse if you buy a house older than 40 years. My insurance just told me that if I don't replace the HVAC (that never worked), water pipes and upgrade my electrical they're raising my premiums.

From the UK and the property appreciation is 9.5%, it makes more sense to buy it as soon as possible.

"if you plan to stay for 5 yrs.." is the most important factor. Your choice will split into 2 framework of choices, and both have pros and cons. What is your risk appetite?

Don't forget the 10% equity gain, so if you had a $500,000 house in 2020, you would be selling it for $605,000 right now. It is over $105,000 in equity gain. Yes it would cost you to sell it up to $30,000 but you are still looking at $75,000 of profit in 2 years in current market conditions. This is why I own properties.

And when you rent you can just call maintenance for any issues with appliances or leaks or mold or anything. Also, you usually have amenities like pools, gyms, etc., and time savers like gardeners.

So a lot of states have a homested exemption which basically means you own the house you live in. You get a tax break there. Then you can deduct the interest on the mortgage from your taxes as well. Plus most energy saving upgrades give you a tax break as well. New windows, new ac or heater, etc etc. plus all that looms good when you sell it so you generally get back most of what you put into it. I have 3 houses now and rent two. I always say that owning a house and renting it would at the worst pay for your rent somewhere else or your mortgage haha

Thank you for pointing this our. So many of these channels say "you should always buy, no matter the situation" which is insane to think about a 18 year old with their 2nd job buying a house just to move in 3 months

Man this was an awesome breakdown. Simple & concise. Thank you!

Honestly renting makes more sense to me right now. I'm still in school, not working in the field I want, and have no idea if I gonna stay in the same city once I graduate. So yeah its mildly more expensive to rent right now. But at least I'm not tied down with a mortgage.

While owning a house will always be more expensive, I think it's more important then theses simple calculations. When you buy a house, you are building equity. Think about when your old and retire. How are you going to live when you no longer work? The money you saved up and social security will go fast and be minimum.

You guys should all keep renting great advice! More real estate for me!

If you were thinking with money in mind, buy house that needs Reno, sweat equity, then sell... Made more doing that than my engineering job by a long shot

I'm on my 4th house in ten years. Done nothing but make money on them.

This depends heavily on where you live.

The guy that owned my house before me was really cool and we made an agreement to not go through anyone else once he knew I was serious. My uncle works in home loans and took care of that side and none of us had to pay a realtor or anyone besides $500 to sign a bunch of shit. If I sold my house right now after only being in it for 1.5 years I would make money.

Bought first house lived for 2 years sold for 40k up bought second house lived in 3 years sold up 230k

It’s always best to buy!

Content is getting much better!

Don’t forget property taxes when you buy

I am a house owner. I plan on living here for a good while and since it is a cheap house in need of some work that I can do myself have I increased what the house is worth by over 50% by spending roughly 10% of what I buyght the house for. I live much cheaper than renting

Put 10k down on my first condo stayed for 3-4yrs made 100k and bought another house witch ive been in for about 5 yrs can sell right now and make another 250k this is in 9 yrs total renting is a no go for me your wasting money in my opinion

Good accountants are truly real-life super heros

keep it up daniel you give us amazing content

The current scenario, Rent is $3000 to own the same house I have would have to pay the mortgage of $5000 every month. That's crazy!

You didn’t mention that when you rent, your money is basically going into nothing. When you buy a house, you are investing into an asset. Just like any investment though, being richer means you save more money in the long run.

It's not a competition. Buying always wins.

I hate the idea of paying a landlord each month. The fact that they can yeet you out whenever they please. Or that rent prices are never worth it. They are always a lot higher than what would be worth it.

Except renting is always more expensive in the longest run if you plan on buying a house eventually.

Dont listen to this guy. I closed on my condo for 5000 and my monthly payment for everything (hoa water electric payment) is about 1000. My friend pays 1300 a mont for an apartment of the same size. On top of that you can do home improvements that increase the value of your house by much more than you put into it. And my place has gone up 30000 dollars in value in just 2 years

Made money on both my last houses I sold in 2 years or less. Might be doing it again this year.

Just build a house. Keep it in the family. Become self-sufficient

The actual break even being 5 years out is irrelevant your landlord can evict you at any moment the bank can't unless you don't pay

Write-offs can offset anything. My home is also my business address. 😉 let that sink in for a minute.

while on the surface this is true but as a renter you dont have an asset whole a homeowner is earning a ton of money in equity from constant rising home costs. over the course of about 10 years many peoples homes will appreciate many hundreds of thousands of dollars

Your mortgage payment covers tax and insurance.

It depends on the appreciation in the area. The Phoenix area appreciated 23% last year. Plus you can rent vs. Sell at the end. Look at the whole picture.

Unless the place sucks, otherwise the price of the property should rise after these five years

Most utilities are not included. Landlords only include what they can't divide, usually garbage, and water if it comes together. Gas and power are almost always on the tenant

And if sth breaks the owner pays it for you (like a/c) and if not you can simply get out

Hey Daniel can you explain more about rothIRA?

Some people think that Owners are going to increase their rent prices.. lol they’re much more afraid losing a tenant that can’t afford. 😂

More content like this. Smart marketing too. Smooth

I like some of these but this one can be wrong sometimes. I bought in 2019 with 15k and closing costs 5k so I’m in for 20k. My payment was 1100 total, taxes, HOA insurance and mortgage included. One bedroom condo, nothing crazy. I’m now selling for a profit. I am getting the 20k I put down back, plus a nice chunk of profit. About a 40% return for living here for 3 years. The 1100 I paid a month, some of it went to my principal (albeit a small amount because that’s how mortgages work) but still, my principal is lower so some of that 1100 is coming back to me when I sell. Apply this same scenario to renting I would be down 3 years of rental payments with nothing to show for it, and at mercy of my landlord to renew my lease or argue with him to try and get my security deposit back and find a new place. I live in a red state that’s not too expensive. If you live in NY and CA (I was born and raised in NYC and fled as soon as I turned 18) I would suggest you move to a cheaper state.

No. Renting never saves you money. If you're gonna move just rent the house out.

Yes unless your are doing tax deed auctions not to mention equity of purchasing houses. Sexondly I have never ever met a land lord that covers utilities.

ANYBODY KNOWS THAT IS CHEAPER TO RENT THAN TO BUY BECAUSE IF YOU BUY YOU PAY TENS AND THOUSANDS OF DOLLARS MORE AND IT'S STILL AIN'T YOURS WHEN YOU RENT THE REAL ESTATE COMPANY OR THE LANDLORD HAS TO PAY ALL THEM OTHER BILLS YOU JUST PAY ONE TIME A MONTH THEY DON'T HAVE TO WORRY ABOUT NO CRAZY PROPERTY TAX AT THE END OF THE YEAR

This video fails to take into account that I bought my house at a value of 300K and sold it a year and a half later for 430K. Zero upgrades.

I know people in there 60 and seventies that still rent. That is scary

What about building a new house with solar panels to eliminate energy cost?

But you do eventually break even, and now you have an asset that will likely appreciate and which can increase in value even further if you renovate or otherwise improve it. Not only that, but depending on what you buy, you could live on one floor or (or side, in a duplex) and rent the other to help pay off the mortgage.

Reality: most people will not have a positive networth untill they own a home.

It's cheaper to buy a house. Landlords dont rent it for less than it costs them.

It’s so true.

I agree with this video but… you don’t need to live there for 5 years he just means “keep” it for at least 5. You could live there few years then rent it out to someone.

If you live in a massive city and are single and still in your 20s renting is ideal due to the fact that you will likely not stay at your current job for more than a few years. Young people in today employment show a much lower retention rates as people tend to move on much faster rather than sticking to their jobs. Those people with great jobs are shopping around for better jobs. So renting is ideal during this time. If you intend to settle down, have a family or are going to stay with the same job for 20 years thing buying a house would be ideal. Though one should consider the true cost of a house. For example a 100k house is going to cost you 150k over 30 years along with maintenance things. So when you buy a house you should add in those cost by adding 25% additional cost. ( you can get sometimes free quotes from many contractors ) So if you buy a house that is 10 years old you should expect to fix that roof in the next 10 to 20 years. This is something most homeowners never consider. Upgrades to the home are another thing homeowners do not consider along with lawn care which can set a person back thousands and thousands per year. These thing are something you may or may not have to do when you rent. If you are paying thousands and thousands of dollars in rent then your property management should be paying for these things. Rentals have strick rules and regulations to which you can use to get new paint, flooring and a ton of other things. Renting places can also mean that you can pay a lease in full with a reduced rate. By paying in advance you could save months of rent to which makes the property management happy that it does not have to worry about not renting such place.

Past market is more like 3 years. If you are going to live in the same spot for +3 years buy cheap learn to make some improvements every year and you'll make a return. If you don't know how to take care of something rent

Always remember that realestate is an investment In most places as property values increase your making money

There are a lot of programs that cover down payment and closing costs also that goes towards your mortgage you don’t lose it

USA only, not in the Uk

Well, the fees to move into apartments these days could easily be a down payment on a house.

Great explanation I've been looking for something like this. Good job 👌👍

What about the cost of housing going up? I get the sometimes it can drop, but my place has almost doubled in price in 5 years. Waiting could price you out 9f the market.

I purchased my first house (a condo) with an FHA with 3,000 for 255,000... 6 months later I sold it for 285,000 and pocketed 22k after closing...

Yeah, but when you rent your money isn’t really going anywhere besides the landlords pocket.

rent also includes profit for the landlord, so factor that in. That, and if you rent you can’t ever sell the place.

I hear property taxes are high in America. Still it's worth buying a house because then you will be able to use the equity in that house to get an investment property with no deposit!!

Yup cuz paying taxes on something you own is right and the fact home ownership has declined from over 85% to under 25% in less than a 100 years tells you something, along with the fact housing cost have increased 1000 times for a new construction of a house 1/4 the size.

Owning houses makes you a lot of money…. If you already have enough to let them sit for a decade before selling

This is nonsense in my area the mortgage is 5600 on a 1.2mil property (old rates) before all other costs and they are renting it out for 15,000 a month. Buying in good areas is always less expensive rent will be multiples of mortgage often times a minimum of 3x

I live in a place where the rent is going up Eve every year and even every few months … at that point you buy a house or move

This is ridiculous. Like, maybe there is somewhere in the country that this is true if but unless your market has incredibly slow real-estate appreciation and low rent cost increases and you need maximum flexibility to move...there's no reason to rent over buying. Even IF there's a crash the worst case is you stay a little longer and hold it out. The home will appreciate and give you a very decent roi on the money you would have paid to rent. And sure, utilities are on you. But what apartment covers utilities anymore? Even adding on insurance and expected repair costs you're in the green. And if you have a crazy repair cost...thats what insurance is for. I don't know. Maybe the markets I'm familiar with are different but any metro are in the PNW--this is terrible advice.

Hi dan.

You can put 3% down and get closing cost assistance this is incorrect

Guess appreciation doesn't exist?

Forgot the biggest perk in the debate, you gain and are paying off for an asset that’s likely worth more in years to come when you buy a house.

Your initial costs may be higher but there’s nothing worse than pouring money into something and having NOTHING to show for it. Purchased a home in 2020, and it’s nearly doubled in value as of now. If you have the capital BUY the home. 300K home, 3% rate, 3% down, $1750/mo including taxes and insurance, utilities 300, BUY

What if you have a va loan. Also you can use the appreciation for money down on next home to get it more affordable

Always buy. Renting is never good long term. Why pay off someone else’s mortgage when you could be paying off your own?

What about buying a house under fha loan, and move out after a few years and get a tenant to fill the space

Yeah but house has a good chance of appreciating and you will need to stay somewhere for more than 5 years what did you expect the answer for that to be no i will live on the streets 5 years later?

The idea of closing costs just seems fundamentally flawed.

Okay, but if someone rents for 30 years and I pay a bit more and purchase the property, at the end of the 30 years I have something. Renting should be temporary, it makes more sense for single people. But long term, having a valuable property to sell, now you have capital. Unless I'm missing something, I don't see many benefits for long term renting.

Ya but in 5 years u'll own a house ... Renting u just throw away money.

Renting is life! 😂

Someone has rental properties... no where offers utilities. Not anymore. A 500 dollar Mortgage would equate to 2500 dollar rent with zero utilities. And that's for a shitty place

Wrong, buy, live there 2 years, rent for just under 3, then sell, keeping profit pay taxes only on the rental income and amortized depreciation

Utilities is never included unless you are lucky

Can u make a video on financing vs leasing a car

And what about in areas that experience real estate booms where the price of rentals doesn't keep up resulting in mortgages that are almost double rent in the same area?

However if you are prior military you can get a home loan with no money down wit h a minimum

Aren’t properly takes included in your mortgage?

my dumbass: “so which one is better?”

5 years out…my house is worth over 50% more than when I bought it in 2020. And people don’t think it’s a bubble…

There ain't no damn way almost ANY place is covering utilities aside from rent. Most of them that do are not $2000 a month property. It's all trailer houses.