Via Mortgage Refinance:
Click to see full graphic:
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Source: Mortgage Refinance
Category: Data Analysis, Digital Media, Real Estate
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.
Nice ad. Did they pay you for that?
I wanna live where whoever made this infographic lives. Apparently, they found a place where they don’t have to pay taxes, utilities, insurance, or ever do any maintenance on their house.
And where there is no inflation (or inflation adjusted charts). And where prices are only 11 times rents. And where everyone is in the top tax bracket (but wants a $110,000 house).
Wow. Very disappoint that you chose to roll out this propoganda. Really whose rent increases 5% per year?! For someone who has blasted the spin machine over at the NAR (National Ass. of Realtors), this makes the NAR look honest. Generally love your stuff, but this is below your normal standards.
Pretty funny. 78% of people say their home is the best investment they have ever made?? HA. Is that among the people who have not been foreclosed upon / walked away / aren’t under water / do a lot of mood altering drugs?
Hey Barry,
You forgot to add this to the, “Really, really, really bad calls” category.
Asking someone whose company name is “MortgageRefinance.com” whether buying is better than owning is like asking a barber if you need a haircut. The answer is always going to be YES.
the colors on the poster are really pretty.
Slling refrigerators to Eskimos!
Thankfully, it is shorter than Waldman, Maj Tom and Maudlin similar blither.
I am working my way back to Maj Tom.
I’m sure the Trulia American Dream survey of Q1 2011 is a representative sampling of a statistical cross section of typical Americans. They’d have no incentive to skew the results, would they?
The diagram under-represents some very real costs, especially with owning a condo. I have to pay Homeowner Dues, which go up every year – at least the same as rent. There’s also property taxes which go up along with the value of your property, and maintenance costs. I would say that buying a place is the worst financial decision I have ever made.
Thanks for sharing this visual summary of the REALTOR pitch, Barry. Some of the shortcomings of their case have been mentioned in earlier comments, but it’s good to see it laid out nicely for careful reflection. If you find a similar layout produced by associations of residential RE investors who specialize in catering to renters, it would be helpful to put it out in another posting.
After tracking residential real estate investment risk for a couple of decades, it’s clear that the appeal of “own vs lease” varies most strongly with age and structure of household, then with stability of income sources, and lately with the degree of financial and political stability enjoyed by the local political units that extract tax bites out of RE owners, and in particular how “over-promised” the local pols are to the workers employed by these political units. The various factoids set forth in this and an hypothetical “pro-rental” counterpart are merely the raw material for each household to assess their current balance between advantages of mobility and benefits of a long term attachment to one place.
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BR: It looked more like a mortgage lender than realtor to me
A lot of landlords only raise the rent for increased taxes on good tenants in single family houses. So renting for those tenants is a decent deal unless they plan on staying longer than 5-7 years. Then the equity build up is worth the risk of ownership. The problem in the past was housing prices rose so quickly people were afraid of waiting (or too greedy to heed the 5-7 year rule.)
“… . Really whose rent increases 5% per year?!” Well, if you get a month free rent in 2010, then a bump of 2 1/2% in 2011, you do. Welcome to Chicago downtown rental market.
http://money.cnn.com/galleries/2011/real_estate/1105/gallery.rent_or_buy/6.htmly
Absolutely incredible. My personal favorite is that homeowners are 28% more likely to improve or repair their home, considering that I have yet to EVER see a rental contract that required the renter to improve or repair the home. Actually ALL repair or improvement is done by the owner, and they are notoriously less inclined to do it when they do not occupy the house. Is that the renter’s fault?
This isn’t even good propaganda. But hey – it’s 1/10th more likely that the homeowner will garden!! That one warranted an exclamation point. Considering the insecurity involved in renting, and the fact that you need permission from the owner to change the landscaping or install any fixtures, that is absolutely a ringing endorsement of renters.
They forget the most important truism: “Home prices never go down!”
The tax benefit is entirely B.S.
The Homeowner pays $12,000 and the Renter pays $9,600 per year. That is a difference of $2,400, yet “after tax benefits” the Homeowner only pays $600 more in the first year?
That $1,800 in savings is only there if they itemize. Any benefit would only come AFTER they’ve exceeded the standard deduction.
Almost everyone (and especially married couples and first time home owners) take the standard deduction. This leaves you with 0% in tax benefits.
The tax savings as a benefit of home ownership are completely overblown… For a married couple they wouldn’t receive a benefit for the first $11,900 they paid in combined property taxes/interest/state taxes/charitable deductions.
RE – MisterMaury: If you think the tax breaks you receive from home ownership are overblown you should talk to an accountant. If you have an accountant, you should probably start looking for a new one.
Isn’t it hard to argue against the main point of this graphic? Due to lower home prices and much lower mortgage rates, buying is looking much more attractive (and rational) vs. 2005/2006/2007/etc. Not enough to propel real estate prices higher, perhaps, but moving in the right direction.
Barry, why would you ever post an infographic on the benefits of buying a home that was created by a company that makes money convincing people to buy homes? Up next week: An infographic from Phillip Morris on the benefits of smoking.
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BR: Cuz a) it was purty; and 2) most of my readers are not eejits who cant think for themselves.