Regardless of age, needs and priorities change. There's no joy in moving, but it's still better than the time suck of hiring a contractor, electrician, and/or plumber. AND having to pay them.
Owning is nice. But it's more limited and more time consuming. There's a cost associated with that.
Home ownership at a young age is an overrated fetish. A home is just a box to keep you and your family warm and dry. Getting attached to a box is silly.
For my first 15 years out of school, renting was the best. Every year I would run the numbers based on the market prices and downpayment I could afford, and conclude that it was more advantageous for me to continue renting, in terms of total cost of ownership.
Renting in my younger years allowed me to move around, following economic and family tailwinds wherever they took me without being burdened by a piece of property that has insane transaction costs (multiple percentage points).
Now that I'm older and less likely to move around in my life, I'm able to afford to be a homeowner. It's good, but unexpectedly having to shell out thousands of dollars every time the house has a problem (plumbing, AC, windows, etc) takes getting used to.
I feel that this was the right call when I compare with a few relatives who are about my age and bought property earlier. They had to change jobs afterwards due to economic changes, and moved to a different city or country, but they didn't manage to sell their property at the price they wanted. So they're now reluctant landlords, dealing at a distance with problematic tenants, and renting a new place of their own in a new city. That feels like a headache I'm happy not to have.
I'm glad I own a house but it can be a massive headache, expense, and time sink. It also places a big constraint on moving as you say. I absolutely wouldn't have wanted one the first 15 years or so out of school and I've been lucky enough that jobs have never forced me to move.
You get old enough, and you get tired of somebody else making decisions from afar that affect your day to day life with no real consequences to them.
Little things like the kitchen layout being moronic and having zero drawers get old when it isn't your choice to remodel or live with it.
And while it's nice to say "just move", let's not forget that moving costs a couple months rent and a massive time investment to find a place to move to that's actually better.
And then your current landlord gets some shitheel realtor to rent the place who repeatedly tries to schedule showings on an hour's notice.
I'm pretty convinced most people buy because they're either tired of the bullshit that comes with renting or want to buy into a specific school district, not because they're worried about making a return on their investment.
A lot of other things can be an obstacle to relocating: wanting to have family close by, having put roots into a community you love. There are definitely tradeoffs to owning a home, but I've decided for me there's more upside than down.
I'm around halfway through the mortgage on my place and relish the thought that once it's paid, even if I eventually find myself between a rock and a financial hard place I'll have four walls and a roof and no obligation to anyone for them. I'll have a good 30 years (give or take) of earning potential left in me by that point which means I'll have plenty of disposable income on top of what I've been squirreling away all along for a retirement. Yeah, I've had to fix leaky pipes (and cursed the time spent doing it) but overall I find comfort in the thought that if current trends continue, I'll have a place to park FOREVER.
To be fair, you may want to retire somewhere different from where you live when you're working--and may want, for example, a smaller place that requires less maintenance. But, yes, there's a strong argument for the desirability of owning your own place if you're a healthy 65 year old because you don't want to one day wake up and find you need to move in a couple months because an owner has sold a building.
If a house is a home, I'd rather be homeless. I personally view a house as more of a shackle than a benefit. I enjoy moving every 2-5 years. I value novelty over routine. My first 12 years of life were in the same home, but other than that I've been moving around regularly.
I am in my late 20s currently, and I'm open to a change in perspective. Maybe there's value in consistency that I will appreciate more at some point. But being told that I won't count as a senior professional until I care about buying property irks me.
Yeah, just sold our home this month in the Midwest and moved into a townhouse that we rent for now. We did end up making a little money (bought in 2016) due to the great market we were in but I think that was just luck for the most part.
The issue with fixes gets even worse when you live in an older city and most of the homes are 80+ years old. It was a nightmare when you start to think about all the little things that are eventually going to need repaired/replaced in the not so distant future.
For now I am happy not having to do any yard work and only having to pay and electric and internet bill. The simplicity is great but I do miss having a little more space for storage/hobbies.
Life today is better if you're already established, i.e. have a well paying job, own a home, etc.
Being young in todays world is exponentially harder than it was, say, 40 years ago. Many young people have given up on the idea of home ownership. I'm 26 and I've had friends laugh in my face when I suggested owning instead of renting. It's simply unattainable unless you're in a lucrative field. I'm in Canada for reference (our home price to income ratio is one of the worst in the world).
Yes, exactly. Owning a home made a lot more sense when employment was for life and young adults had kids. But I don't have children and who knows where my next job will be? I'd take a good offer almost anywhere. Owning complicates that.
Owning a home is not risk free. It can be somewhat illiquid. Its value can go down or stagnate. Maintenance costs can be significant and it can really suck having to move to find employment and sell into a down market. Much of this is not experienced by renters.
Going into retirement home ownership is quite helpful. But otherwise it’s been a mixed blessing throughout my career. I was never able to switch jobs without moving. And it was never a sellers market when I needed to sell.
What's also interesting is that transportation & communication are very much easier than they were for past generations. This is also combined with shorter times that a worker stays at a single job before moving on for another opportunity. Put all this together and nobody wants to stay in a single house for 10+ years, or even in the same city for that length of time: at this point, buying a house would be counterproductive -- even if you could afford it -- because the transaction costs eat you alive.
For these reasons, a lot of us younger generation folks actually value a high-quality rental property more than buying exactly that same house. [Yes, sure, you buy the house and you'll eventually pay it off, but you'd be surprised how many people don't believe they will be able to afford to retire at all, much less accumulate any wealth whatsoever.]
Money aside, there's a big difference in lifestyle (some might say quality of life) of homeowners vs renters. There's a lot you can do in a property you own yourself that you simply cannot do in a rental. It's hard to put a price on being able to customize things exactly to your liking. For example I recently had 20 year old thermostat replaced with a Nest thermostat that gives me a lot more flexibility and efficiency in how I heat my home; I never would have made that type of change in a rental. I can paint whatever I want without permission from the landlord. Ditto for having pets.
And greater housing security in old age is very appealing. That people will need a place to live even after they stop working is something even the financially illiterate can understand and plan for with home ownership. For my parents who are retired on a fixed income, having a paid off home is the difference between a comfortable enough retirement lifestyle and being stressed a landlord is going to claim an even greater share of their meager income with every passing year. As owners they still have exposure to property tax increases, but that's modest compared to escalating market rents.
I'm convinced renting is the best thing for old age.
The reason I say that is because 9 times out of 10, from what I observed, old people who own end up living in squalor because they lose the ability (financial or otherwise) to care for their house. Maintenance ends up being deferred indefinitely. At the same time senior apartments are incredibly affordable, at least in my area.
Sure, that's not every old person, but I see it enough that it's concerning.
We own the home outright, no mortgage. The repair and maintenance expenses are sporadic and extreme. $6k here, $8k there, without warning.
Rent increases are definitely something to watch out for, but in another six years we will no longer have any school-age children, and our ability to move around without regard for school districts increases dramatically. In 30 years, I will have exceeded my life expectancy at birth, although I hope to still be kicking, obviously. I will probably be retired in half that time.
I've watched my parents end up in a house far too big for them after kids moved out, and they downsize to another house that ended up still being far too big for them.
My willingness/desire to rent may be a reflection of my phase of life more than anything: when I was very young, I rented because I wasn't yet sure I wanted to be locked in somewhere for decades. Then I owned a house for decades until a divorce, rented while I figured out what my life was going to be like again, and now another marriage and another house, but my future looks like it will be a lot less locked in, a mirror of my youth. We intend to travel extensively, spending just shy of six months overseas. At that point we don't need to be paying expenses for a place in which we're not living.
It's not a basic necessity, but it does give you a lot of financial security, physical security and a sense of permanence in your community, especially when paired with other trends like gentrification. I've got retired friends that rent and have lived in my area since they were children but their pensions/funds aren't keeping up with rent prices and moving out to the country to die is a real possibility. Owning a property would have buffered them against this change. For people starting families today increasing rent prices is taking up more of their salaries, a mortgage goes down relative to inflation, and when you buy a property you can factor in things like which schools your children will go to. A home owner of any age will be able to weather negative events like unemployment or debilitating illness a lot better.
Reminds me a recent story: a friend's girlfriend, in her 50's, recently took off a month off to help move her widowed mother, in her 70's, down to a new retirement place in Florida. She took all her stuff from a 3000 sq ft house.
My two observations:
1. The economic price for someone to take a month off to move and rearrange a sizeable household is nontrivial.
2. That someone would desire to spent the rest of their days in a big house full of stuff is foreign to me. This is the generational divide.
The formation of a estate filled with physical possessions is a prime driver for a lot of older folks. The younger set isn't so interested in that.
My ideal retirement: a bed, a desk, and a laptop in a small flat on the left bank in Paris.
This is going to have a big impact on several industries. In the future, fine furniture and china manufacturers are going to look like furriers today.
Owning is nice. But it's more limited and more time consuming. There's a cost associated with that.
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