Since writing Part  1, I’ve been talking with friends about this whole issue even more.  Whats startling is that despite the sound argument I made in the previous entry, I still find myself looking at the MetroBrokers real estate site and specifically at condos in Plaza Midtown, Spire, Etc.  A couple friends of mine are also looking and we’ve joked how fun it would be to all get them in the same building, which it would.

Then a couple weeks ago, we resigned our lease on our apartment, and surprise, they jacked up our rent $100.  Awesome.

So its getting to the point where you really have to look at it again.  Every case is different, from the specific property, to the specific market it’s in, but also while taking into account macro market trends and forces.

Really all along my primary problem with buying, I think, is the whole idea of taking on such a massive amount of debt.  I learned my lesson with credit cards and worked to get them all paid off, and have been credit card debt free for 3 or 4 years now.  The whole idea is to build wealth, not pay some bank interest on $300,000 for 30 years, right?

The only saving grace to all of that, from what I can tell, is the appreciation on the property.  If the house appreciates in worth faster than inflation and also compensates for the 5% or 6% interest you’re paying on that huge loan, then thats the inflection point at which it probably becomes a good idea.

Then there’s also the point that once you pay off the house, now you have no more housing costs.  Well thats nice, if you can live in one place for freaking 30 years.  Who does that these days?  I have serious doubts that this country will even be a sovereign nation in 30 years, let alone whether a 1bdrm condo will be still standing.  So, if you have a house, and you want to move, there’s some 11% or so of your house’s worth gone to real estate agents.  Thats quite a freakin fee, anytime you simply want to move.

Along the same train of thought, its been asked of me - “What happens when you’re 40 or 50?  You’re still going to be paying rent while everyone else is living in a paid off house”.  Really?  Cause I thought the whole point that I made about renting was that it was vastly cheaper, per month, than owning.  What do you think I did with all that extra money each month for 30 years?  Thats right, put it in an interest bearing  account.  By the time I’m 40 or 50 the idea there would then be able to simply purchase a home with cash.  Again it all comes back to not taking on massive loads of debt.

On one hand you can pay interest to a bank for 30 years and end up with a house, or you can have a bank pay you interest for 30 years and end up with a house.  It’s just intuition but I’d think the latter is what would result in a bigger additional lump of wealth waiting on me in addition to that house.

Or, hell, fuck it -  maybe Ill just move back in with mom and live for free.  Now *thats* a wise financial decision.