The Home Ownership Thread

[imatlas]

What the **** is a dethatcher.

 

[Piobaire]

What the **** is a dethatcher.

Manscaping tool.

 

[otc]

What the **** is a dethatcher.

To be fair, I didn't know about it until moving here either.

Maybe that's because I previously never had a lawn (other than my parents), but there might be regional differences as well...the common grass here has a different texture than I was used to in the upper midwest. More fine and spindly, more likely to go dormant in a dry summer, etc.

I'm just trying to make the lawn a little nicer for our upcoming child to crawl around on...fill it in a bit more and make it more "plush"

 

[Omega Male]

Hero.

 

[Omega Male]

Ramit has been beating this drum for a long time and has taken untold **** from the realtor-industrial complex. Can forgive him for dunking a little.

 

[RedLantern]

What exactly do we mean by "economic sense?" I understand that you can consider "housing" as a fungible commodity by comparing $/ft2 or bedrooms/bathrooms etc., but that's always going to be a rather reductive view of housing as ownership conveys a different bundle of rights. For a lot of people, renting is not a good substitute for ownership. IDK, I guess by pure microeconomic theory everyone is always doing whatever makes the best economic sense for them in any particular moment . . .

 

[brokencycle]

What exactly do we mean by "economic sense?" I understand that you can consider "housing" as a fungible commodity by comparing $/ft2 or bedrooms/bathrooms etc., but that's always going to be a rather reductive view of housing as ownership conveys a different bundle of rights. For a lot of people, renting is not a good substitute for ownership. IDK, I guess by pure microeconomic theory everyone is always doing whatever makes the best economic sense for them in any particular moment . . .

I strongly believe we overemphasize home ownership in this country.

I posted in another thread how the US has an extremely high migration rate relative to other countries. That can put people at a huge disadvantage (think single company towns or other dying towns).

We also train people that buying a house is an investment. It really isn't. It is normally a forced saving tool. At its best, people get lucky and are able to sell at a large gain because they bought in a rapidly appreciating area. At worst, it is a money trap.

The problem is that people typically move every 7 years or so. Most people who see that appreciation sell to upgrade. Problem is that upgrade also appreciated over time, so they're probably no better off financially.

People also just don't count all the not-so hidden costs of ownership, and they can't wrap their heads around compound growth. As an example, the house we are currently buying is 13x the price it was the last time it was sold (and if it had been sold 4 years ago, it probably would have sold for half that). That only works out to 5.5% in nominal growth and <2% in real growth. The real annualized return on the S&P 500 over the same period was 8%.

Renting is likely in a lot of people's economic best interests. I say this as someone who, as I posted recently, that I'm going to be building a custom home. It feels like a completely dumb financial move, but we're going in viewing it as consumption not investment.