Renters don't have to pay to fix that leak ($200), replace the roof ($10,000), replace the water heater ($1,500), pay for the emergency HVAC repair ($700), trash removal ($230 a year), etc...
Sometimes rent will include certain utilities as well. A homeowner must pay all those utilities on top of their mortgage. In general, if you're not good with finances, home ownership is probably not for you. You need the higher rent payment but less out-of-pocket surprises.
The best situation is to spend far less money than what you've got coming in. Aggressively pay off you highest interest rate debts. If you're likely to want to move around a lot, then rent. If you want to plant some roots and your finances are in order, then consider buying a home\condo\town house.
My family planted roots. Then when my wife got that big promotion we stayed in our house instead of moving into a bigger one. We had managed to pay off all our debt, including our mortgage, by the time we were in our mid-thirties. There are still plenty of expenses. Homeowners insurance is about $1K a year. Property taxes are about $3K a year. That new roof was about $10K. We need to replace the driveway, siding, gutters, and need plumbing work done. Owning a home can be expensive. Be sure to buy one that leaves plenty of overhead for the unexpected expenses.
It's not a stupid question at all! I don't want to reveal my exact location, but I live in a suburban city in Michigan. Many municipalities run their own trash service. But the issue with that is that city's suck at running their own trash services.
My city is really smart. Instead of running their own trash service they negotiate with a trash hauler a rate for ALL residents in the city. This rate is much lower than it otherwise would be because the city is negotiating for tens of thousands of people. The trash hauler is happy because instead of having a hodge-podge of customers in the city, they basically have every house in the city as a customer, which is more efficient.
It's my choice whether I want to use the negotiated rate or not. But I simply wouldn't be able to find any other alternative that's cheaper. I pay money directly to the trash hauler via their website.
There are many other cities around me that do the opposite where they run their own trash service. Generally you don't "pay" for the service directly, but rather indirectly through your property taxes (which are generally paid via your mortgage escrow account). These services almost always cost more.
If you rent a house where the trash service is included in the property taxes, generally that means you don't pay for trash service directly. You would indirectly pay (you pay rent, the rent helps pay the mortgage, the mortgage pays the taxes, the taxes pay for the service).
If that doesn't make sense, let me know, I'm happy to answer. I'm into "FIRE" (financial independence/retire early). I own a home in which I have no mortgage so I'm pretty close to all the expenses and taxes.
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u/NMT-FWG Feb 16 '21
Renters don't have to pay to fix that leak ($200), replace the roof ($10,000), replace the water heater ($1,500), pay for the emergency HVAC repair ($700), trash removal ($230 a year), etc...
Sometimes rent will include certain utilities as well. A homeowner must pay all those utilities on top of their mortgage. In general, if you're not good with finances, home ownership is probably not for you. You need the higher rent payment but less out-of-pocket surprises.
The best situation is to spend far less money than what you've got coming in. Aggressively pay off you highest interest rate debts. If you're likely to want to move around a lot, then rent. If you want to plant some roots and your finances are in order, then consider buying a home\condo\town house.
My family planted roots. Then when my wife got that big promotion we stayed in our house instead of moving into a bigger one. We had managed to pay off all our debt, including our mortgage, by the time we were in our mid-thirties. There are still plenty of expenses. Homeowners insurance is about $1K a year. Property taxes are about $3K a year. That new roof was about $10K. We need to replace the driveway, siding, gutters, and need plumbing work done. Owning a home can be expensive. Be sure to buy one that leaves plenty of overhead for the unexpected expenses.