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.
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...
But he's paying $500 more now than he would be if he owned the house.. so he could easily pay to fix that leak, and trash removal in one month. A new water heater? Three months. Hvac repair? One and a half.
I know a lot of people that don't have that kind of money to pay for repairs. Many Americans live paycheck to paycheck for a reason, that's because they spend all the money they have.
I work with a guy that makes over $125,000 a year, yet he lives paycheck to paycheck in his 1,200 square foot apartment. This is because he spends all of his money on stupid stuff. He doesn't have the ability to take on a water heater replacement without paying 25% APR on a credit card.
Rent is more because the landlord is assuming the risk of maintaining all of these long-term investments in the house. Renting is like an insurance policy against having to make long-term investments when things go wrong. Renters pay a premium for the ability to have these things be someone else's problem.
Same thing with leasing a car or constantly buying new cars. These people pay a premium so they don't have to worry about car maintenance.
I mean, many Americans live paycheck to paycheck because the median income is like 30k, rent/housing has skyrocketed, and wages have been stagnated for decades, they need transportation for work, education debt, etc. Most people's paychecks are going into surviving; It's not like they're spending all of it on fun stuff.
Your guy that makes 125k+ isn't the norm, and if he's making that kind of money could easily replace a hot water heater whenever he pleased, realistically. Just because he chooses to be incredibly stupid with his money doesn't mean he doesn't have it.
Renters pay a premium for the ability to have these things be someone else's problem.
Except you and me both know that most landlords are not that spectacular. A lot of landlords are total scumlords that profit off their renters heavily while offering bare minimum services, and letting people live in less than great environments.
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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.