Do you think renting is dead money?

Dudess · 01-06-2011 07:22PM #1

Really? Why stop at renting then? Why not apply the "dead money" logic to any essential/life-improving service?

I don't understand the above mind-set - accommodation is provided by someone else who owns it, therefore they have to be paid. If it's too expensive or the accommodation is sub-standard, well ok, that's not worth paying for, but if it's what you're looking for and you're happy there, what's "dead money" about that if the alternative is not affordable?

Tefral · 01-06-2011 07:24PM

I suppose its got to do with the fact the rent money isnt going to buy you accomodation that you will own one day.

I mean you could be paying the same on a mortgage and you would also be essentially paying installments to eventually own the dwelling..

Renting only gains you a roof over your head.
Buying and paying a mortgage gives you the roof over your head but the money is also used to essentially buy the place in the end therefore giving you 2 things rather than just renting which gives you one.

chin_grin · 01-06-2011 07:26PM

cronin_j wrote: »

I suppose its got to do with the fact the rent money isnt going to buy you accomodation that you will own one day.

I mean you could be paying the same on a mortgage and you would also be essentially paying installments to eventually own the dwelling..

Renting only gains you a roof over your head.
Buying and paying a mortgage gives you the roof over your head but the money is also used to essentially buy the place in the end therefore giving you 2 things rather than just renting which gives you one.

Tell that to all those in negative equity. :pac:

cornbb · 01-06-2011 07:26PM

Paying interest on a mortgage is dead money too. And you don't actually own the house for 20/30/40 years anyway.

Havermeyer · 01-06-2011 07:27PM

The first DLC for Fallout: New Vegas is "Dead Money".

Snakeblood · 01-06-2011 07:27PM

Dudess wrote: »

Really? Why stop at renting then? Why not apply the "dead money" logic to any essential/life-improving service?

I don't understand the above mind-set - accommodation is provided by someone else who owns it, therefore they have to be paid. If it's too expensive or the accommodation is sub-standard, well ok, that's not worth paying for, but if it's what you're looking for and you're happy there, what's "dead money" about that if the alternative is not affordable?

There are a lot of people walking around right now who wish they'd invested in dead money rather than the vampire stuff that's sucking the life out of them.

I realise this is a tortured metaphor so let me close on this.

SAN DIMAS HIGH SCHOOL FOOTBALL RULES

Nolanger · 01-06-2011 07:28PM

Britain to become a nation of renters

Millions of young adults 'will never be able to afford their own homes'

By Andy McSmith
A generation of young British adults is close to giving up hope of ever owning their own place to live. A startling new survey reveals that while the great majority of young Britons from "Generation Rent" would like to become homeowners, most believe they will be unable to raise the mortgage they require to get on to the property ladder.

A combination of continually rising house prices and pessimism about the future is threatening to send into reverse the explosion in home ownership stimulated by Margaret Thatcher 30 years ago, making Britain more like Europe, where living in rented property is the norm. The findings, issued by the Halifax, coincide with a separate report from the housing charity Shelter which reveals that the number of mortgages offered in April slumped to the lowest level since records began. Just 29,355 mortgages were granted, 18 per cent fewer than during the same month last year.

ScumLord · 01-06-2011 07:28PM

Dudess wrote: »

Really? Why stop at renting then? Why not apply the "dead money" logic to any essential/life-improving service?

There's been a recession just so you know, people haven't said that for the past two years.

In fact us renters laugh when we hear something like that from people in negative equity.

Micky Dolenz · 01-06-2011 07:29PM

It's an old saying for old people.

We all need to live somewhere. I bought a house in 09 for a friction of what they wanted and my mortgage is still higher then if I was renting the exact same house. With renting is great freedom, no maintenance worries and you can feck off when you feel like it.

Kevin Bacon · 01-06-2011 07:29PM

You receive the use of an asset, namely the house or flat. That is not dead money. Very simple stuff.

Dead money would be throwing out in the street, you receive no good or service for it.

Never understood what people meant by that.

Snakeblood · 01-06-2011 07:31PM

Micky Dolenz wrote: »

We all need to live somewhere. I bought a house in 09 for a friction of what they wanted and my mortgage is still higher then if I was renting the exact same house.

Well, that's the rub, isn't it?

Danbo! · 01-06-2011 07:31PM

Haha I love this phrase. Heard it all the time in 2004-2007. "ya finton, my one bed mid terrace in athlone means a 2 hour commute to Dublin but the value went up 10,000 last week alone, you should buy, renting is dead money."

Don't hear any of the ****ers telling me how much their house's value dropped last week now.

Benny_Cake · 01-06-2011 07:32PM

Never got this argument. If I took the train every day for 30 years, I wouldn't expect to own a train at the end of it all. I pay for a service, I get the service, I stop paying, I don't get it anymore. I speak as a homeowner btw (well, mortgage payer would be more accurate). If it suits you to rent, then rent.

Crasp · 01-06-2011 07:33PM

Flatmate owns our college apartment. charges me and a 3rd flatmate 300 per month. (say 600 total).

So I lose 300 per month and at the end of the 5 years of college have lost 18,000. (I think? sounds like a lot).

my flatmate buys apartment, uses our rent to pay his mortgage installments.
at the end of the 5 years, sells the apartment (probably for a profit) and at worst breaks even. I'm down 18,000.

that's why rent is dead money!

BrianSlipknot · 01-06-2011 07:35PM

Rentings great. No restrictions as in you're not stuck there when u eventually own the place. AND as said before the bank owns your ass for about 20/30 years anyway 'till its paid off.

Tar.Aldarion · 01-06-2011 07:36PM

renting is the way to go, get to change house/location when you want...not tied down as much. Constantly get a change of scenery etc

Snakeblood · 01-06-2011 07:36PM

Crasp wrote: »

Flatmate owns our college apartment. charges me and a 3rd flatmate 300 per month. (say 600 total).

So I lose 300 per month and at the end of the 5 years of college have lost 18,000. (I think? sounds like a lot).

my flatmate buys apartment, uses our rent to pay his mortgage installments.
at the end of the 5 years, sells the apartment (probably for a profit) and at worst breaks even. I'm down 18,000.

that's why rent is dead money!

You aren't losing anything. You're buying a service. Your flatmate is gambling with a mortgage that he will be able to pay, and that he will be able to sell for a profit orr break even.

Benny_Cake · 01-06-2011 07:37PM

Crasp wrote: »

Flatmate owns our college apartment. charges me and a 3rd flatmate 300 per month. (say 600 total).

So I lose 300 per month and at the end of the 5 years of college have lost 18,000. (I think? sounds like a lot).

my flatmate buys apartment, uses our rent to pay his mortgage installments.
at the end of the 5 years, sells the apartment (probably for a profit) and at worst breaks even. I'm down 18,000.

that's why rent is dead money!

But you have the use of an apartment for 5 years. So you're not just handing over money and getting nothing back! I wouldn't be so jealous of your flatmate, the value of apartments in a lot of places has fallen far more than the value of houses.

Silentcorner · 01-06-2011 07:37PM

if you hope to live past 65 you had better put money into something if you have been renting all your life...a pension perhaps...how are they performing these days does anyone know?

After 20/30/40 years the roof over your head is yours, you live for free....the day you stop paying rent you are out on the street...

The people who are now the pro renters have become as obnoxious as the old "our property is now worth..." dimwits....negative equity only affects you if you are selling or can't afford the mortgage ( in which case you will probably live for free for two years anyway )

--LOS-- · 01-06-2011 07:37PM

Thats just the attitude of this country, it is a lot more common to rent in other countries like Switzerland but then that is only due to the price of property there. I wouldnt view it as dead money anyway, you're dead stuck in the one house forever though.

kelle · 01-06-2011 07:38PM

Well, I'm very pleased I bought my house. My mortgage repayments were slightly less than the rent I had been paying on a flat for 2 years previous, and I now own the house outright.

If I hadn't spent so long renting, I could have owned my house sooner.

Benny_Cake · 01-06-2011 07:40PM

Silentcorner wrote: »

if you hope to live past 65 you had better put money into something if you have been renting all your life...a pension perhaps...how are they performing these days does anyone know?

After 20/30/40 years the roof over your head is yours, you live for free....the day you stop paying rent you are out on the street...

The people who are now the pro renters have become as obnoxious as the old "our property is now worth..." dimwits....negative equity only affects you if you are selling or can't afford the mortgage ( in which case you will probably live for free for two years anyway )

I agree with your last paragraph. It suits a lot of people to rent, if I was single and wanted to live in the city, you bet I'd be renting. We did rent for years, but got a bit tired of the shoebox apartments in Dublin (at the time it was hard to find decent-sized places to rent at a reasonable price). We moved out and purchased in early 2010 and have no regrets even though the value has dropped a bit since then, our quality of life has really improved. Horses for courses really.

stovelid · 01-06-2011 07:42PM

Owning a home suits some people, especially those who don't want to move around anymore or sometimes those with kids and they will own the house eventually, giving their kids an asset when they die. Renting suits some people for other no less valid reasons. To be honest, the smug pontificating from those who rent is no less annoying than that from the buyers during the boom years. Everybody makes a lifestyle choice and it is no better or worse than anybody else's.

01-06-2011 07:43PM

Kevin Bacon wrote: »

You receive the use of an asset, namely the house or flat. That is not dead money. Very simple stuff.

Dead money would be throwing out in the street, you receive no good or service for it.

Never understood what people meant by that.

It's a phrase churned out by people who see housing as an asset rather than shelter, by that it means that after paying the mortgage (easily 2x the "price" of the house) it's yours to sell. Rent on the other hand is spent with no chance of any return.

Most people who promote "rent is dead money" hope to gain somewhere from the property market.

jam_mac_jam · 01-06-2011 07:43PM

Food is dead money, transport is dead money..

opinion guy · 01-06-2011 07:44PM

Crasp wrote: »

at the end of the 5 years, sells the apartment (probably for a profit) and at worst breaks even

:eek:
Where've you been ?
I hope you are not studying economics!

Silentcorner · 01-06-2011 07:45PM

And by the way you are not stuck in the one house, you can rent it out to someone willing to pay the mortgage for you, you can rent where ever you like and still in 20/30/40 years time you have an asset you can sell or live in.

People in other countries rent off someone as well, that doesn't make them smart does it?

We live in a predominantly rural country where we should expect to own a home, for security if nothing else. They will prove to be as reliable as any pension.

My point is, on the balance over a 20/30/40 year period you are better off buying....

amacachi · 01-06-2011 07:45PM

Crasp wrote: »

Flatmate owns our college apartment. charges me and a 3rd flatmate 300 per month. (say 600 total).

So I lose 300 per month and at the end of the 5 years of college have lost 18,000. (I think? sounds like a lot).

my flatmate buys apartment, uses our rent to pay his mortgage installments.
at the end of the 5 years, sells the apartment (probably for a profit) and at worst breaks even. I'm down 18,000.

that's why rent is dead money!

Fair play to him/her for making a profit in these times. Also for being in a position to get a mortgage when in college. Out of interest, you do realise that after 5 years probably about 5%, if even, of the principal will have been paid back? Add fees etc. and selling the place at cost price means breaking even. Then again, we all know property values only ever go up!

opinion guy · 01-06-2011 07:46PM

jam_mac_jam wrote: »

Food is dead money, transport is dead money..

Has anyone seen any live money around ?
I tried feeding mine, watering it, giving it light etc. It never grows:(

amacachi · 01-06-2011 07:47PM

stovelid wrote: »

Owning a home suits some people, especially those who don't want to move around anymore or sometimes those with kids and they will own the house eventually, giving their kids an asset when they die. Renting suits some people for other no less valid reasons. To be honest, the smug pontificating from those who rent is no less annoying than that from the buyers during the boom years. Everybody makes a lifestyle choice and it is no better or worse than anybody else's.

Except when people bitch and moan that they can't afford their lifestyle choice but still insist they should be entitled to it.

Crasp · 01-06-2011 07:48PM

Snakeblood wrote: »

You aren't losing anything. You're buying a service. Your flatmate is gambling with a mortgage that he will be able to pay, and that he will be able to sell for a profit orr break even.

Benny_Cake wrote: »

But you have the use of an apartment for 5 years. So you're not just handing over money and getting nothing back! I wouldn't be so jealous of your flatmate, the value of apartments in a lot of places has fallen far more than the value of houses.

The question isn't about buying a service or not, it's about buying Vs renting.. it's a sound investment where we are, I am certain they will make a profit on the apartment.

I have the use of the apartment for 5 years, at the end I have nothing. They have the use of the apartment for 5 years, at the end, they still have an apartment!

that's the difference... We bothe bought the same "service"

Do you think renting is dead money?

Do you think renting is dead money? 87 votes

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