Answer to Brad's Housing Question

[Aaron]

>So, make double principle payments and you've got a fifteen year mortgage.
>It's only $45 a month, slowly increasing.

In the next paragraph I eluded to the fact that I'm paying double payments each month.  This cuts 
it down to under 10.

>Your principle and interest won't go up (given a fixed mortgage).  Want to
>bet what your rent will do over the next thirty years?

So true but then we didn't even talk about maintaining a house as it gets older.  If the foundation 
settles in my apartment I can call the landlord or move to a different appartment.  In my 
appartment I have someone to mow the grass, replace the fridge, stove, dishwasher, furnace, air, 
water heater, etc... when they die.  If the deck door falls off they come and fix it.  In the house 
I have to pay to get those things done.  There's more money just to maintain the value.

>After thirty years, you own a house.  After thirty years of renting, you
>own nothing.  How is that breaking even?  Take a look beyond your next
>paycheck, you'll see that it is a no-brainer.  Not necessarily this year,
>but in five to ten you're way ahead.

The break even comes if you look at what I've actually paid for the house over those thirty years.  
Do you seriously think house values will tripple over thirty years?  If they do and I sell my house 
for $300,000 then I've just gotten out what I paid for it, not counting repains and maintence.  We 
call that breaking even.  I would estimate that after 30 years I might be able to get, maybe, 
$200,000 out of it.  So now I'm in the hole $100K. (If I took 30 years to pay)

>Well, I think that you should never finance anything that depreciates.  
>Pay cash or do without.  That's why my cars are all ancient.  But I do
>generally agree with you about Johnson county real estate values.

Heh, my cars are acient also.  I paid $100 for one and $200 for the other. :)  My wife wants a new 
car.  I told her to go get a job and then she can go buy one.  "Jeeezzz Woman, I just bought you a 
house!"

>Regards,
>
>-Don, Missourian

What?  No mention of my wiring project?  **sob**  Where's the love?

Aaron