The True Cost of Buying a House
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- Опубліковано 24 січ 2023
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Hi there 👋 If you're new to my videos my name is Matt D'Avella. I'm a documentary filmmaker, entrepreneur and UA-camr. I've made a couple documentaries for Netflix. I also teach courses on everything from filmmaking to habit change. If you like to nerd out about self-development as much as I do, you can subscribe for weekly videos.
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🎬 Credits
Directed by Matt D'Avella
Edited by Zach Mayfield & Matt D’Avella
Animation by Spencer Torok - Фільми й анімація
Run the numbers for yourself here: www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html
My husband and i wish we had bought sooner, because even with the unforseen/unplanned costs of owning a home, we would have had our home paid off by now (15 yr fixed home mortgage). We have been living in our community for 15 yrs now, but married/living together for 20 yrs.
Matt, just one point, I think you had a bit incorrect. While the value of your home may rise in the future due to market conditions, all homes will eventually depreciate. To understand depreciation, consider whether you could buy a brand new house in the same location with the same features for less money than the price you will receive for your current house after ten years. Typically, the answer is no, because houses always lose value regardless of market appreciation.
Hi Matt, congrats on your house! Your experience is very similar to our purchase of a 100 yo Queenslander in Brisbane 5 years ago. We ripped up the floor, and did a not-so-proper fix so it can be at least functional. Now we rented it out, and starting to make positive return after 5 years. It was a lot of work, but definitely worth it. Wish u luck! And good luck with your baby too!
This is such a great calculator, I highly recommend it for anyone curious about buying vs renting
@WhY So SeRioUs? I’m sure they did, so did we (in Ireland you have to in order to get a mortgage) but generally they won’t rip out your floor to check underneath.
I've been watching the housing market closely, Prices have been skyrocketing for years. It's going to be tough for first-time buyers to enter the market." how can one diversify $280k reserve .
I agree, It's not just the prices, but also the increasing interest rates that are making it more difficult for people to afford homes. With a good FA you can make up your portfolio.
Precise asset allocation is crucial, with some employing hedging strategies or allocating to defensive assets for market downturns. Expert guidance is vital for success. This approach has kept me financially secure for over five years, yielding almost $1 million in investment returns.
in times like these, it's crucial to be cautious and not rush into the market , Who is this your FA , my portfolio needs urgent attention , been a lot of loss.
“Tenley Megan Amerson” is the licensed coach I use. Just research the name. You'd find necessary details to work with a correspondence to set up an appointment.
I appreciate it. After searching her name online and reviewing her credentials, I'm quite impressed. I've contacted her as I could use all the help I can get. A call has been scheduled.
Back in the day, when I purchased my first home to live-in; that was Miami in the early 1990s, first mortgages with rates of 8 to 9% and 9% to 10% were typical. People will have to accept the possibility that we won't ever return to 3%. If sellers must sell, home prices will have to decline, and lower evaluations will follow. Pretty sure I'm not alone in my chain of thoughts.
If anything, it'll get worse. Very soon, affordable housing will no longer be affordable. So anything anyone want to do, I will advise they do it now because the prices today will look like dips tomorrow. Until the Fed clamps down even further, I think we're going to see hysteria due to rampant inflation. You can't halfway rip the band-aid off.
Home prices will come down eventually, but for now; get your money (as much as you can) out of the housing market and get into the financial markets or gold. The new mortgage rates are crazy, add to that the recession and the fact that mortgage guidelines are getting more difficult. Home prices will need to fall by a minimum of 40% (more like 50%) before the market normalizes.If you are in cross roads or need sincere advise on the best moves to take now its best you seek an independent advisor who knows about the financial markets.
I'm sure the idea of an investment-Adviser might sound controversial to a few, but a new study by Motley-fool found out that demand for Financial-Advisers sky-rocketed by over 42% since the pandemic and based on firsthand encounter I can say for certain their skillsets are topnotch. I've accrued north of 580k within 16-months from an initially stagnant Portfolio.
@@joshbarney114 I've been thinking of going that route been holding on to a bunch of stocks that keeps tanking and I don't know if to keep holding or just dump them, do think your Inv-adviser could guide me with portfolio-restructuring as i wouldn’t mind a recommendation
@@FabioOdelega876 Actually, I've shuffled through a few advisors in the past, and "Colleen Janie Towe” remains the most resourceful thus far. Her strategy proves profitable, and sustainable both in a bull & bear market. Most likely, her credentials can be found on the net, so you can confirm yourself.
I sold my house a year ago at the peak of the market, and went back to renting. I was tired of paying for and worrying about repairs. In 2021 I spent $25k on repairs and maintenance. Not everyone has that kind of cash laying around, but you need it when you own a house. You can't just look at the mortgage payment. Houses are expensive to maintain!
I’m glad you put this out. Society makes you feel like a loser if you don’t own a home…
Stop hanging out with that "society" they're not good for you.
Yeah. They want me to buy something in the suburbs. Never! The #1 regret when buying is location. I will not leave the city life, however, it’s insane to buy a 1b1b for $900k + 1.2k/mo in HOA, + $500/mo in taxes + any addt’l repair costs while rents for the same apartment are at $3,500. You can put the “buying” monthly payment difference towards your retirement, and you can leave that property any year if you see the building falling apart.
@@sak_5 yeah, I heard a Rob Bell quote, “renting is buying the option to leave.”
Design shows have really romanticized fixer uppers, but if you're going to buy a house that old, it is impossible to do so financially (for most people) without having the skills to be able to fix those issues yourself. For example, we also bought an 1890s row house. However, we only chose to do so because my father-in-law is a carpenter/contractor. Without him (considering the electrical, plumbing and structural issues we discovered) this house would have ruined us financially if we had needed to hire outside help. Old houses will always, always cost more than you think to renovate.
they also have the most room to go up in value, compared to newer houses that loose values initially similar to cars. Most cases its best to buy a house 10-20 years old, not old enough to have a bunch of problems, not new enough to continue going down in value.
Value moving also trends with how ever the market is and the last few years has been a bad example of what it normally is.
doing it yourself you lose your wages from working though so unless your income is less than what youre paying a labourer to do then you're leaving money on the table
We bought our first home in the last 12 months. The price of the mortgage monthly is less than 50% of renting costs. As a parent, it was also a factor to leave a home for our children when we are gone.
Congratulations on your home!
Another thing is, buying a home won’t “make you happy”, remember to never let buying be an emotional decision to fill a void
I did not have a void to fill, but it simply made me happier because my quality of life improved.
It's a quality of life aspect and a backdrop for your life. It shouldn't be a burden, it should be a place where good memories are made.
THIS just HAPPENED TO MY PARENTS. They bought an old house thinking it'd just need some cosmetic updates.... and then yes.. each problem lead to 5 more and yes their entire house ended up came down to the studs. Feel so bad for them. God bless you all.
Buying a house will be one of the major purchase and decision of a person's life. This is why we have to get our finances in check before taking that big step. As a person like me who hasn't bought a home yet, this is helpful. Thanks Matt! ♥
You are 100% correct! Having your finances in order is the most important first step!
I feel for you, my dude. My husband and I bought our first home when we were 25. The first week owning the house, the basement flooded due to a freak winter storm that burst our pipes (we live in Canada). It was a mess that cost us 60K. Truly would not wish it on anyone, but we got through it, and when we sold our first home, we made back all our money and then some. It wasn't easy, but definitely still worth it! Keep going, it will get better!
Did your home insurance cover the pipe damages?
Did you put in an insurance claim? This should have been covered under your homeowners policy. Asking because we deal with burst pipes frequently.
I bought my first home in 2022. The home was built in 1998 and the seller was the originally owner. Yet, I still hire a home inspector for a thorough home inspection before closing. Home inspector identified a few problems/money pits with the home. Never skip home inspection.
My husband and I bought an old house this past summer, and that “we can lean into the joy and excitement that comes with owning our first home as soon as we get that *-* is fixed” energy is soooooo relatable 😂❤
So happy to see Ramit on your video! This guy changed our lives. We bought his book and started listening to his podcast almost a year ago and we went from a negative net worth to over $30K in that short time. Ramit confirms my decision to never be a homeowner and I have never felt better about that. If you are stressed financially get the book. It could change your life.
Is the Book: I will teach you to be rich?
@@0xdef Yes.
I thought it was a total click bait titled book that was going to have a bunch of bs on how to get rich quick, so I decided to rent from the library thinking it would be a joke. Within 2 weeks of reading it, I returned the library version and bought a copy because it resonated so much.
@@andrewchase2634 Ramit is the GOAT. Love his no BS irreverent approach to everything. He's also helped me in public speaking a lot. He's so eloquent
This is why you do your due diligence and definitely never waive inspections. There shouldn't be any surprises when you buy a home.
You are 100% correct! Never waive your inspections! Being in a seller's market here in Oregon we were seeing a lot of buyers waiving their inspection period to gain leverage in multiple offer situations! I always advise my clients to have their inspections!
Inspections do not catch it all. Some things cannot be seen in an inspection. Hopefully they catch the big ticket items, but almost guaranteed they miss something.
@@mattschmitt9924 wrong. A proper inspection is not a "hopefully" catch something eventually. A proper inspection won't miss anything important. You can test for it all. An inspection is not just a visual inspection but certain inspections require specialized equipment and sensors.
@@TheRealWinser So all foundation cracks can bee seen through the drywall of a finished basement? The wiring inside the walls will be completely inspected, inch by inch, for rodent damage? As well as every electric connection on the property? What specialized equipment tests for those things? I could continue with examples of things that anyone that has bought multiple properties can tell you. There is always surprises when you buy a property. Your ignorance on this subject is shining brightly through the words you type.
@@mattschmitt9924 I could explain it but I have a feeling I'd just be wasting my time.
Love your videos Matt. Our home in the UK was built between 1690 - 1705 so we know all about hidden costs, it’s been a total money pit but thankfully we’ve absolutely loved living here and hopefully you and Nat will feel the same about your house in the end
Mat, while I am watching the ad, I just want to say - you cannot imagine just how timely this is. And also humble and honest and interesting and I can just go on and on and on… Thanks Matt!
I found the same place to rent or buy. I would have had to live there for 45 years, have zero maintenance costs, have no inflation, no renovations, to just break even. fortunately my family owns a home, and I can see how often things break, need updating, and loose value if not maintained... I do not think I would be alive to see the day I break even. And that debt would loom menacingly over me for the rest of my possibly shorter and with fewer days off life. Now the upside is that you can make the place your own, and if you are not a minimalist, you need space to keep your stuff somewhere. Living simple, makes renting easier, living with children, lots of toys and miscellaneous, it makes renting more complicated. Having a bad neighbour can ruin your owning experience, getting away from that is easier by moving. Selling an expensive place, is also hard. I see properties decaying waiting oi be sold for over ten years now. Don't forget about recessions... yes, life, adult life is fun. buy a cheap place, at least one car, and commute, or rent in the city and bike... don't forget to factor in the price of vehicles, insurance, maintenance, in the cost of living further away...
Salut Alex
Depends where you live and what you buy.
I appreciate the original post. Just in reading it I had the thoughts of how rent will greatly increase over the next 45 years and the renter has no choice but to pay it. The money you save by biking in the city will get eaten up by the higher costs of city life. Bad neighbors are everywhere, but owning a home on property gets you physically away from them. Most renters don't have that luxury. Buying is not for everyone, but renting is NOT for me.
That's why I say to hell with the cities, move to the countryside and live on acreage, then you'll rarely have to deal with neighbours.
You buy the house at a fixed price but as time goes on, you're paying less and less of your income on it as the principal of the loan goes down. The negating factor is interest rates, which always stifle property sales.
We know the feeling mate, we bought a house in 2015, thinking exactly the same just a lick of paint and new furniture and we’d own a home finally!
Only to find out 5 days later after we moved in, the house had all of the issues and previous owners cut all the corners.
7 years in we’re still in renovation mode and still coming up against issues.
What really blows my mind is how you had a 20% deposit and paid up front for those expensive repairs... In Sydney.... I've lived here my whole life and only just now in my early 30s can even begin to contemplate home ownership here. Massive, massive props to the both of you ❤️
I am so grateful for this video .. was about to look into buying a home on Monday, and here you are. My hope is for the clarity you brought for me and my family, that something wonderful happen for you and yours.
Thanks for showing an honest account of buying a house but also the problems that can come with it. We bought our first house last year and while its not been as old as 130 years, we also came across some surprises that needed fixing. We have been lucky so far, as we budgeted enough but it nice to see someone successful on UA-cam showing a real scenario :)
Our house has been 50/50 awesome and difficult. We live in a rural area where homes rarely go on the market. When this house came up for sale, we pounced on it! Congratulations on your new home. It will be great in the long-run.
The biggest loss in owning a home is your TIME. It takes a crazy amount of time to maintain a home, even a brand new one.
Very important video, thank you for your insights Matt.
Times are changing and yet mainstream advice takes too long to catch up - we’re lucky to have you!
I just bought a place in November, but I intentionally undershot my max budget by about 30% and bought in an up & coming neighborhood. So far, I’ve had ~$1500 in unplanned expenses and have about $5000 in things I plan to improve over time. There were a few “turn key” places that would have pushed my budget further, and maybe I wouldn’t have needed to make some of these improvements… but it’s just as possible that I would have, and wouldn’t have had the extra cash to get it done.
Buying vs renting I think comes down to what you want out of where you live.
Renting is good because you can come and go without the worries of maintaining the home.
Buying is good because you can completely customize everything to fit your lifestyle.
You can't actually customise everything to fit your lifestyle when you buy a house. Unless you design and build the house yourself it's not going to be everything you want, and once you've actually moved in and started living you'll find things you'll want to change that you didn't foresee. And you can't exactly live the city life in a 5 bedroom home, or be really active driving 3 hours on your commute.
3:04 "I took the $3000 difference and invested in the market"
Andddd it's gone🤷🏻♂
Exactly. Stock market has done nothing but go up with cheap money and nowhere for it to go but the market. Things are going to be verrrry different coming up here. Gurus like this will learn that the market does indeed go down too :)
So basically the lesson is: Live at your parents' house as much as possible. I shall gladly do it, too many benefits lol
Cult of Neoteny
This is the reality for many young adults now. They can't afford to move out.
Yes, mom's home cooked meals is a fantastic reason!
As someone living in their parents attic and saving ~50% of my income - it's nice.
I'm starting to get really invested in your houses journey. Please keep us updated.
I feel for you two, and hope the added stress is not too hard on Nat. I'm currently house hunting in France near Lyon where the market is crushing but since we already own our flat and will make a nice profit off of it it just makes sense to buy again (+ this is time sensitive since we're in a one bedroom 50sq meters appt with a one y-o...) It's so stressfull and we'll go from being ok to financially tight for severall years (two small incomes, not many chances of improvement in pour respective fields) but we'll have to absorb the added cost and, thanks for the wake up call, plan for renovation costs.... I really hope my daughter will appreciate the quality of life we're trying to provide here ! Good Luck to all who try for this highly stress inducing venture !
A big consideration is the location too. My wife and I bought our first house this past summer in South Carolina. We were very diligent and lucky to have a newly remodeled home in a older district. We’ve had little to no issues because the seller had just gutted the home and rebuilt. If you are renovating yourself, that’s a whole other fight
Glad to see Ramit back in the channel. You together make personal finance more understandable/friendly to discuss with youngsters like me. Cheers!
Many great points. Some glaring things that stand out to be are also doing your due diligence when purchasing. Here in Canada depending on the age of the home (older than 1975) a sewer scope is a must! Lots of major issues can be avoided by getting proper disclosures from the sellers, a great home inspector and sewer scope. Buying isn’t always what’s best for sure, but if you do, do it the right way to ensure your investment is protected. Once again, great video!
Great video! I'm turning 26 next week and my partner & I are moving into that stage where we want to consider a house.... but no matter which way I spin it, it doesn't seem possible. I appreciate the honesty in this video, in does give me some comfort to know that it's not laziness or whatever else people say that's keeping young people from buying homes.
Consider renting out your extra rooms to friends to help cover the mortgage/maintenance
Thank you for this video being a member of a new family and being a freelance photographer, we been thinking about our next step as a family. This real really really helps.
Enjoy the honesty and questions to ask yourself when purchasing or renting. Great work as always Matt 👍👍
Hi Matt! I love your videos. Thank you for motivating me to start my own UA-cam account.
Hi Matt! Awesome video as always! I would love to see more videos about this topic and similar from you (home prices, renovation costs, taxes, etc,! It's very helpful for potential home buyers but not only from AU but from all over the world hence these situation is similar everywhere! Thanks!
Thanks for capturing this through, Matt! The bells and whistles that not many people mind or mention to you upfront before buying a house are equally important. It's always going to be mortgage...and more :)
I have never related to a video more! My fiancee and I recently bought a home and our project of upgrading our electrical quickly revealed leaky plumbing, which revealed a failing sewer pipe which then revealed poor building drainage...it just goes on and on. We're committed to doing things "the right way" but it's cost immensely more than we planned for and it often makes me wonder if this the financially smart decision to make, going from renting to buying. There's no turning back now, but home ownership definitely feels like a nesting doll...one problem keeps revealing another!
But once you get that last little one opened up, there's a treasure in there. It's your sanity and future wealth. Keep grinding at it and it will be great soon.
This was so informative. I appreciate you taking the time to research and put together such a comprehensive video.
thank you for new info and the conversation with the specialist in this field!!
Awesome video as always Matt!
I hope you guys got a home inspection prior to buying.
A home inspection is an absolute MUST for anyone buying a home.
The inspection will uncover a lot of these issues you are dealing with and many more.
You can also leverage a home inspection report to get the seller to fix thing or give you a better deal on the buying price.
This was helpful, thank you! And congratulations on you home!
I’m disabled and I live in an apartment. I know I can’t fix the stuff around a house and I can’t cut the grass or shovel the driveway. Therefore living in apartments is great for me. But my wife keeps looking at houses to buy. So I’m gonna send her this video. Thanks.
You can buy an apartment/condo and not have to shovel snow or cut grass. For stuff you can't fix you'll have to call someone and pay them. Learn to fix things though, it's not hard.
@@vitaminb4869 OP stated their disabled so whatever may seem easy to you, might not be to them. I know that you’re trying to be helpful, but that’s just something to keep in mind. Not everyone can do the same thing and that’s okay. ✨
Thank you for talking about something so important. We all want a stable living situation but can’t typically afford the initial price let alone the price of insurance, maintenance, etc. Ownership of a home brings a lack of worry you could get kicked out for lack of rent. It brings you a place you can do whatever you want to. To truly make your own. However the benefits of rent is it costs less than the total costs of home ownership. Hearing from the perspective of does it work for you individually or in a family unit is refreshing to hear. You are being so realistic about it and that's also appreciated.
I love your videos man! Keep up the good work bro!
We bought our house in Sydney innerwest area 3 years ago. Our house is from 1915. We had a report for termites and humidity before purchasing. Either way, we had to fix windows , among other things. I'm glad you had money saved to fix stuff, as we did. Sydney is wild when renting, since you don't know when you can get "kicked out", so it makes more sense to own vs rent, besides all the reasons you mentioned in your video.
From my experience, renting in NYC was horrible because it was constant fights with landlords to get anything fixed. So, rent raised for nothing in exchange unless you count getting headaches. It made me want to be a homeowner...but I don't think I'll ever afford that. 😂
You can affordably own a nice prime 1br with 200k household in Manhattan or 150k in the outers, no debt 20%+ down. If you buy less prime or further out or less affordable etc you can make it a 2br.
I rent in NYC and I have been fortunate with my building. It's very well insulated so it's quiet. I can't even hear my neighbor's parties.
Hi Matt! Awesome video as always! I would love to see more videos about this topic and similar from you (home prices, renovation costs, taxes, etc,! It's very helpful for potential home buyers but not only from AU but from all over the world hence these situation is similar everywhere! T
Hi Matt! I just bought my first home with my partner at 29 - never thought I’d be able to but here we are. A 1930’s downstairs home with a tiny garden in the city. We ran into the same ‘problems' as you did - I know a ton about subjects I never thought I’d know anything about (isolation and ventilation, who knew!). We thought we’d move into a home where we’d have to do a little bit, but that’s when you find out you have to renew all the plumbing, gas and electricity because most of it has been either duct taped or is insanely old (there were some original 1930’s sewage pipes, woohoo!).
We’re extremely lucky though to have my dad, who knows a lot about everything construction wise and was able to teach us most of it. Without him it wouldn’t have been possible financially. In the end I’m actually really glad we bought a small home because this way it was still sort of organized and the big renovations took just three months (three very 12 hour work days long months). There’s still a lot to do, but we’ve moved in now and are taking some rest now.
For us it made total sense to buy, even with the extra construction costs. Renting has exploded in the city here and compared to buying it’s way more expensive. Plus an advantage that I’m not seeing in the video is that this way you can do anything you want with the house, including investing in stuff (like isolation!) that makes it better. My rental house had a mold problem and no way the housing company would make that a priority to fix. I would though, in my own house.
I’ve been so blessed to have a father who is a residential builder. Simply put he could identify items that would need to be fixed/corrected and also made us promise we will not balloon above appraisal value (which sadly, many did in the past couple years). Found a house that is well built, affordable and can be updated at our pace. Btw, always hire an inspector and spend money on one that offers multiple services. I spent $750 and gave my partner and I peace of mind at closing.
Thanks Matt for this video! Super appreciate it
From my perspective buying a house for ourselves is such a great decision cause we gotta evaluate our financial situation before buying cause the house might need some renovations . We are treated in a unacceptable way when we wanna rent a house just like we are forced to expand the renting without having any reasons …
I'm glad you're a minimalist!
You know, society makes you feel like crap for not owning but I’m just looking at my renting life right now as so much less stress. I’m not spending my free time maintaining a house or going to bed with worries of major repairs. There’s no price tag for peace.
but most of the money goes to rent for many. Paycheck to paycheck. There is no peace if you can't grow.
Such a brilliant video, many people (including myself) really want to buy, but didnt know the first thing about preparing
This was a great video Matt! As someone who purchased our first home last year just as the craziness was ending, navigating the thought of if it is better to rent or buy was a stressful one. In the end, it was much more worth it to buy. But yes, once you get into that home you can discover just how much work needs to be done, which means you discover just how much money you need to spend. A home is a great investment if you are financially and mentally prepared for it!
Depends how old your home is. Mine was 8 years old. I didn't even bother doing home inspection. I've owned it now since 2015 and all I had to repair so far is replace $1 bearing in my dishwasher. So $1 in 8 years, is ain't much to ask. Yes, I did some other updates (new paint, new floors, new washer/dryer - not all at once) too, but those were entirely optional.
As someone in their early twenties who has no idea if they'll ever be able to afford a home, I really appreciated the honesty of this video. I do not like being subject to a landlord's whims, but not having to stress out about any fixes that need to be made or appliances that need to be replaced is a huge weight off my shoulders. I've been lucky that most of my landlords have been quite kind and quick to fix issues (which should be the standard but lord knows it isn't), and I really can't imagine the stress (both financial and emotional) of finding out there's a huge unforeseen issue with a house that I have to suddenly fork out the €€€ for. And I feel free and able to move around as much as I want. Great video!
Can I just say your house is BEAUTIFUL. So glad you're treating it well, I hope life there treats you well, too.
thanks a lot for making this!
Love this style of editing Matt!
Super relevant video Matt, thoroughly enjoyed ☺️
well done man!! glad you could put ramit on he's on point.
When I bought my house my realtor was upfront about the pros and cons in my decisions. Like the types of repairs I would be doing in certain subdivisions and year of house. First year I did about 30k in repairs but I also bought my a house that I intended to house hack so I still make a return on that side and the appreciation just gave so back so much more.
Matt and Nat, I hope you don't mind if I say that although my husband and I have gone through house poverty the first time we purchased our house and still going through work after work just to make the house 'in shape' but your story has made me feel grateful that we've been going through only that. You had it so much tougher and I'm glad that your house now is in a much better state.
For a moment remembered about our journey of buying our this house. That was stressful but really worths it.
best video I have seen on this subject, speaking as a renter and I love renting
Glad I bought a condo! Last year my apartment rent went from $600 to $1,000. I said "nope" and got good downpayment assistance for a condo since I'm disabled, so now I'm living in quadruple the square footage for less than rent.
Congratulations on the new house, very deserved!
It's INSANE we're paying MORE for houses that have gotten OLDER 💥
Most people forget you ALSO have to pay for tons of necessary remodel of older aging things in the house
Why? Older houses are usually of higher quality and located in better neighbourhoods. Maybe it’s different in the us, but in Europe and Australia the inner city houses are older and with new builds you end up in the suburbs.
Best model is to think about the structure and the land separately. Probably the land appreciates much faster.
We’ll said Striker.
A house (structure) depriciates, and tends to lose value overtime, the land it sits on is what appreciates. Land is a finite resource, there is only so much space in a city, and as people keep moving into big urban areas more people will have to compete for the same amount of space which drives the price of land up.
You don't have to remodel. That's is discretionary. And can be deferred.
Great video as always
Great vid. To anyone feeling pressured into buying a house, definitely run the numbers first. Like Ramit, I also lived in high cost of living cities almost my entire life and it absolutely never ever made sense to buy. I just kept investing the money into other sources and it has given me a ton of flexibility to keep moving around without feeling locked down and committed to one place that I'm on the hook for maintaining and taking care of general upkeep.
loving this new topics!!
I definitely appreciate this video as someone trying to better plan their finances for the future, trying to figure out things like if I should rent or buy a home later in life gives me a ton of anxiety
I bought my first house 8 years ago and did a lot of work on it myself. It is a building from 1933, totally loved it but decided to upgrade a few years later. My new property was build in 2001 and its built quality is 10x better. I am paying thousands every months towards remodeling/new furniture etc... but this is normal the first few years of ownership.
Owning a house is a ride, you must be passionate about it.
I still own my first house and I'm renting it out now. It has always served my family very well.
Awesome video 👍🏻 thank you for sharing!
Such a great video! Love Remit 👏🏼
I work in construction in Australia and LMAO when you talked about bearer and joist. I was impressed initially not knowing you found all that to make some repairs 😂😂
Excellent video. Congratulations also!
THIS IS SO WELL EXPLAINED!
In Japan we have a somewhat saner premise to the housing market: if your house is old it's worth less. Houses are for living in, not speculating on.
Thanks for sharing this. Great story with a glimpse of reality.
Congratulations on the house and baby! 🎉
Great thing about UA-cam is that you can really learn how to DIY fix a lot of the issues & maintenance when owning a house. Except for Electrical, most renovations and improvements can be done, however you'll also be spending money on tools and that can get expensive but worth it . Tools you will always reuse during the house's lifetime!
This is a great way to explain it for those who are unsure. Living in the Midwest, there were no rental options for the cost. We ended up building a brand new home and stuck to Dave Ramsay’s principle of 25% or less of your take home pay. You’re exactly right though. Depending on your situation and location, that greatly depends on what you do for a home. Great video Matt.
📌Do what everybody else is doing if you are okay with only having what everybody else has.Information that will pay you everyday, you've got to stop saving all your money.
Venture into investing some, if you really want financial stability.
Choose to grow and elevate your mind by studying audios, videos, attending conferences that will give you the edge!
Exactly, money is always eager and ready to work for anyone who is ready to employ it. That is why it’s nice to start up an investment now. I have researched about this bitcoin and I found it profitable.
@@kelyshiailcia2335 I have been researching all this while for a digital asset investment and I found bitcoin to be the most profiting of them all , I’m definitely bouncing on the opportunity, thank you so much.
I understand the fact that tomorrow isn't promised to anyone, but investing today is a hard thing to do because i have no idea of how and where to invest in these?
@@hervenacitas8265 In situations like this,I always recommend to people on getting guidance at least from someone that understands price action and all that while you strive on improving yourself by watching videos and learning fundamental analysis.
Lately I’ve been thinking of investing in cryptocurrency , I’ve set asides $350k to invest but along the line,I usually get cold feet, maybe because I have no idea what I’m doing,
LOVED this video Matt, different to what I expected from the title. Beautiful to see you and Nat's house coming along :)
My partner and I bought our first place last year, a 2 bed apartment in Melbourne. The stress of stretching a mortgage to the price of a house VS an apartment was not worth it for our current life situ of no kids/late 20's! SO many hidden costs 💯
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Great video Matt. Before buying a home perspective buyers should really start with building a real estate investing knowledge base. Even if they don't go on to build a portfolio of more than one.
Groups like bigger pockets are really great at breaking down the costs of an investment, and just a little bit of knowledge on how to think like an investor can save you big $$$. Agents often don't explain the whole story so it's on the buyer to know what to ask.
Also buying older homes is often a risky investment. Homes do have a lifespan just like a car. The older it gets the more expensive it will be to maintain until the maintenance costs are so high no one will want to bother. Buying a home from the 60s,70s,80s is often a sweet spot. Less maintenance and still affordable compared to newer builds.
Btw I love talking real estate so anyone looking to get pointed in the right direction, I'm here to help.
As always, great video! I appreciate the insight, but have to point out two major points of influence: location and home age. Most people are not purchasing in Sydney, and Sydney (and LA, NY) have very high costs of living.
If I recall correctly, you had to purchase on auction, which may have eliminated the option to have a home inspection.
In the U.S., auctions are available but they certainly are not the norm. You can always get an independent inspection to protect yourself from unforeseen costs/hidden damages, and even walk away from a deal with little-to-no money spent.
$1.25M AUD is about $888k USD; the median home cost in the US is less than half that. In Chicago (still expensive) the median home cost is around $350k.
Homes built in the early 1900s/late 1800s will always have higher cost for maintenance, but most people can find, inspect, and purchase a modern home within 60 minutes or less from a major city, for well under what was represented in this video.
I first learned about ramit from matt’s videos. he’a been my go to pf info ever since. IWT is a great book. Love that we’re digging deeper into the rent v buy discussion here
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Haha we bought a house in Boston built in 1915. We faced many of the same issues you did, lots of old house problems. 20 years later it's finally a home we love but dang, it was a lot of money, time (had to spread the expenses out over time), and work!!
Thank you for this wonderful video! I have incurred so much losses trading on my own....I trade well on demo but I think the real market is manipulated.... Can anyone help me out or at least tell me what I'm doing wrong?
Same here, My portfolio has been going down the drain while I try trading,l just don't know what I do wrong
I strongly advise you against self trading, it's really dangerous and had brought so many investors down, you need someone with the knowledge and strategies, someone dedicated to the crypto currency market business, and I will strongly recommend expert, Mrs Janet
Wow I'm just shock you mentioned and recommended Expert Mrs Janet,I thought I'm the only trading with her
Here in Texas Expert Mrs Janet carries out the both orientation and mentorship
potentials
I stumbled upon one of her clients testimonies and decided to try her out...I'm Expecting my third cashout in 2days
So glad you brought on @Rhamit.
would love to see more of the renovation if you want to do a house series or something
Great video, super useful 👌🙏
Ramit is spot on with Oklahoma. We have a nice house in a nice neighborhood and only budget 25% of our net income to home related expenses (including saving for the unexpected).
Same! For the same price of renting 2br 1 bath, we bought a 3br 1.5 bath in Tulsa. And if you're Native American (like many are here), your tribe likely has a mortgage assistance program for first-time home buyers who buy within tribal territory. That's what we did and it pretty much paid for our down payment and closing costs.
Worthy to mention that it’s important to get multiple estimates and multiple opinions. Sometimes serious problems have simple fixes and other times seemingly simple problems require serious fixes. Obviously spending the money to fix subfloors and joists and install a new floor is far more satisfying than rebuilding drainage. Ugh. All in all taking care of your home has its rewards.
Super interesting video, couldn’t agree more. Just one hint: I think in the time vs equity graph I think you mixed up the two axis (the way your graph is drawn, there are several equity amounts for some points in time, and typically time is shown on the horizontal axis, as you do later on in the house-prices graph 👍🏼)