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Respected Contributor
Posts: 3,529
Registered: ‎03-15-2010

Out of the mouths of babes ( or Millennials)

We were out to dinner with friends who just sold there home and had been happy to have sold it for over $100,000 more than they paid until ..............their son who is a very bright guy in the finance world ran the numbers.

Mind you their son is a millennial who makes a VERY good living and is very against the "shackles of homeownership"  although he does invest in commercial real estate on the side.

 

He ran the numbers of what his parents spent on:

taxes

interest on the loan

up-keep- new hot water tank, new roof, appliances

landscaping/yard care

general maintenance

Etc.....

 

and of course they are in the "hole" there is no actual profit.

 

Their son and his friends can not comprehend the idea of buying something that you have to continually pay taxes on every year you own it,  in addition to all the other on-going expenses.  From a financial business model it does not make sense to them.

 

It was an interesting and sobering perspective on how times are changing.

Esteemed Contributor
Posts: 7,093
Registered: ‎06-10-2015

Re: Out of the mouths of babes ( or Millennials)

Just where does he live?  In a tent?  Even if you rent you pay taxes they are added in your rent cost, so is maintenance, etc..  So you really never get away with not paying taxes.

DRUNKS, CHILDREN and LEGGINGS...ALWAYS TELLS THE TRUTH. (unknown)
Respected Contributor
Posts: 2,148
Registered: ‎03-09-2010

Re: Out of the mouths of babes ( or Millennials)

I would say he needs to look at the other side of being a home owner. The money you spend is on something that belongs to you. You don't just have a stack of rent receipts at the end of the year. You get to do what you want with your own home and have things your way.  Of course if you keep a home up you won't ever get back all the money you have invested in it back when you sell. But you can't put a price on all the enjoyment you have had from living in your own home. Most people though will always sell for more than they paid and they end up with something at the end and not just a stack of paper.

Honored Contributor
Posts: 22,097
Registered: ‎03-10-2010

Re: Out of the mouths of babes ( or Millennials)

Yeah, but I'd still rather have my house than two hundred grand in student loans.

~My philosophy: Dogs are God's most perfect creatures. Angels, here on Earth, who teach us to be better human beings.~
Honored Contributor
Posts: 11,252
Registered: ‎03-09-2010

Re: Out of the mouths of babes ( or Millennials)

I view property taxes as the cost to maintain a healthy, safe area in which to reside.  Maintenance is the cost to enjoy our comfort and privacy in a safe living environment.  I guess I never thought about buying our home as a profit-generating investment.

Valued Contributor
Posts: 936
Registered: ‎09-05-2014

Re: Out of the mouths of babes ( or Millennials)

I've said that a home is a liability, not an asset, especially if you have a mortgage...before millenials were even born. But, for some people, it makes sense for a myriad of reasons.

But here's the reality: even if you rent you are paying taxes, new hot water heater, maintenance...it's likely just rolled into the rent price. A landlord isn't going to give those away for free..it's like "free shipping"...

 

 

Honored Contributor
Posts: 9,811
Registered: ‎03-27-2010

Re: Out of the mouths of babes ( or Millennials)

The money paid on rent is a deep hole.  Yes, it costs money to live in a home at least there is a paycheck when you sell a home. Think of all the money spent on rent, actually from a financial aspect it doesn't make sense to rent.

Respected Contributor
Posts: 4,690
Registered: ‎03-09-2010

Re: Out of the mouths of babes ( or Millennials)

Seems few Millenials were taught Serfdom.

 

My own millenial will tell you.......living in a rented apartment is making his landlord wealthy.

 

That is until the landlord decides to raise so high you can no longer afford it or his tax writeoffs have expired, sells the building and gives you a notice that lands you in the street.

 

 

Trusted Contributor
Posts: 1,481
Registered: ‎03-26-2010

Re: Out of the mouths of babes ( or Millennials)

I agree with @deepwaterdotter, PLUS, once that mortgage is paid off, the monthly cost (taxes, mainteance, etc.) is greatly reduced.  Once our mortgage was paid off, we could REALLY begin to add to our retirement saving.

Valued Contributor
Posts: 705
Registered: ‎03-09-2010

Re: Out of the mouths of babes ( or Millennials)

I choose to look at owning a home in a different way. Yes, there are expense's of owning a home like tax's and up keep, but I don't want to give my money to a landlord every month and I love having my own home and 5 acre's of land. Rent's in my area are outrageous. Why would anyone choose to give a landlord money every month when they can own thier own home?