Buying House With No Money
My purpose here is to explore the three main reasons Cardone and other financial gurus often used to argue against buying a house – and offer an argument against.
1. That depends on where you live.
If you own your home? Can be. But maybe not. Real estate is expensive. In fact, it is one of the main reasons that many homeowners and landlords fail.
In addition to the mortgage payment, the owner of the house also have to fix the plumbing, replacing the roof, shoveling snow, painting walls, replacing carpet – you get the idea. There are many hidden costs above and beyond the cost of the mortgage to be considered, and the oldest of the property, the higher the costs tend to be.
However, in many areas, it is still cheaper to own than rent. For example, in my city, I can buy a decent family home for about $ 75,000, corresponding to a mortgage of about $ 500 per month, including taxes and insurance. That same home would rent for around $ 1000 per month. So does the average homeowner has $ 75,000 $ 500 in expenses at home months? No, unless he or she has a horrible house.
Therefore, the place where I live, at least, it makes more financial sense to own or buy – even necessary repairs and maintenance. Of course, in some areas, it could be much cheaper to rent than own, while in big cities like New York, San Francisco, Miami and other cities, the opposite is often true. All these facts add up to why you should not take the advice of Internet coverage in making their decisions.
2. Owning a house that still does – right?
This was the main reason Cardone presented his argument against buying a home. “To make money today, you need mobility,” he wrote.
Personally, I find it strange – because I lived in the same county for 10 years, and I’ve made money. Many.
So what you really need mobility to make money? Of course, mobility is fun. I remember the “mobile lifestyle.” Life in a suitcase, sleeping on friends ‘couches, eating cheese mac n cold remains’ I found in the back of the refrigerator. Long live mobility!
But then something strange happens: We grow. We started to be responsible for things in our life. We made some kind of stability. We want to raise our children in the same place. We do not want to lose the friendships we have with our neighbors. We still want to avoid having to go again and again and because of the decision of another person.
When you rent a house, yes, you can leave when your lease, which could be six or nine months down the road. Or, if you sell your home, you may be in a month or two. Better yet, if you need to move suddenly, you just have to rent your property to a tenant and – gasp – move! Now create wealth through rental properties and you are free to be mobile – meaning.
3. Is real estate a bad investment?
Many financial bloggers like to point out that property values ??are increasing at a slower pace shares. Okay, that may be true, but do not tell the whole story.
As the famous economist and Nobel Robert Shiller award said, using the / Case-Shiller index of S & P, home value over the last 100 years has enjoyed, on average, at about the same rate as inflation: 3 percent.
Therefore, we must immediately reject buying a home because they appreciate fast enough?
Of course not. The real appreciation is just one of the many benefits to owning property. When you own real estate, usually does not pay 100 percent cash for it. Instead, a loan is obtained and used a small fee to take possession. Thus, even if the price of your property can be increased only 3 percent, the real return on investment could be significantly higher.
The biggest disadvantage of renting
The bottom line is, should you buy a house? I have no idea; maybe you should, and maybe you should not.
But if you base your decision on a financial guru who says that “buying a home is for fools,” we need to talk. In his video, Grant Cardone said that “The best investment you can make is to have the choice and freedom”. I could not agree more. And when you decide to rent, you give up a significant part of their freedom to live the way you want to live; the hand that freedom to an owner like me.
When a homeowner, however, no one will suddenly come upon you because he or she has made a decision for the property that does not include you. You will not have to move your child to another less desirable school district. No one shall arbitrarily raise your rent because the housing market has improved, decreasing the number of houses and apartments available in your city.
Moreover, no one can deny the opportunity to paint your bedroom the color you want, or wooden floors you. In other words, when you own a home, no one will tell you what to do.
But do not go forward. Keep the rent. I will continue to buy rental properties and grow my own wealth. I will continue to tell you to clean your deck, I will continue to deny her boyfriend to get permission.
I can also choose to increase their income because I need an extra latte month or two.