Warren Buffett: Why Buying a House is a LOUSY Investment

Buying a house is usually a lousy investment. This 8 word sentence is enough to start a fight if you say it to the wrong person. But please, before you come at me with pitchforks, I’m not the one saying this. This is coming from legendary investor Warren Buffett. Let’s just say Warren knows a thing or 135 billion about money.
This video covers topics such as buying a house, renting vs buying, the housing market, does it make sense to buy a house in 2024, Warren Buffett real estate, Warren Buffett’s house, real estate, housing market predictions, and much more.
Make sure to always check out this video:
- Warren Buffett: A “Storm is Brewing” in the US Real Estate Market: • Warren Buffett: "A Sto...
As a bit of background, there is a mindset that renting is throwing away money or that buying a home is always a great investment. While these statements do have some merit, as Warren Buffett pointed out in that clip, they don’t tell the whole picture. Most people just look at the monthly mortgage payment and compare that to what it would cost to rent a similar place. They see that the mortgage payment is around the same as what their rent would be and say “yep that’s it. Renting a home is a waste of money. May as well buy”. However, there is much more that goes into it than just that. To demonstrate what I mean, let me introduce you to our friend John here.
John has been working hard and saving money for years. He has done everything right financially and now has the ability to purchase a home. Let’s take a closer look at John’s true cost of buying a house.
When buying a home, the first thing you have to consider is the down payment. In the United States, there are some companies and government programs that offer low or even no money down mortgage options. However, these types of mortgages are generally considered relatively risky. Just look at the wave of foreclosures that happened during the Great Financial Crisis. These foreclosures skewed heavily towards individuals and families that bought at the peak of the market with little or no down payment. That is why it is highly recommended that home buyers have at least a 10 to 20% down payment when purchasing a home.

[@InvestorCenter]

Warren Buffett: A “Storm is Brewing” in the US Real Estate Market: kzbin.info/www/bejne/gKLCZ4WBfa98f6Msi=r2pxygPCtX2ZlNFT

[@IMBLESSED-oe6dl]

No it's not id u buy low, I bought my house right before covid.

[@11fasteddie]

AI is taking over,,, wished you'd explain in real person,,, thumbs down on this one

[@folasadeoyedepo2463]

00​@@IMBLESSED-oe6dl

[@edwinwheatley2732]

Of course these people would say buying a house is a bad investment. They want to own all the homes so they can control the rent. We bought a house four years ago. Our mortgage is 1200 a month and locked in. Today the same house will have a mortgage of 2600. You see buying a house protects one from rent inflation and that alone would save thousands in a lifetime.

[@TeeroyHammermill]

Yea but it doesn't protect you from tax and insurance inflation. I don't think owning a home is a bad investment, especially if you have a family. However owning a home is not the end all to wealth building

[@wilson8979]

@@TeeroyHammermillexactly right, and all the money in repairs. I would rather be homeless then sink money into a house. I’m an attractive female. I can live anyway. I can afford an apartment , it’s not a problem and way less stress and money then a house.

[@YC-dx5vl]

If you are paying interest for 30 years, maybe it's not a good investment. Not to mention the property tax and up keep for the house.

[@romeoandjuliet6522]

​@@wilson8979even if you pay off house you gotta pay for heat bills mentinance and property tax if you don't pay government take your house so you don't own house . you are preaty girl you don't need to buy home

[@Rugabooorg]

🤣

[@jeffwozniak965]

It’s funny how Warren buffet never said buying a home was a lousy investment, and that he is also a homeowner lol

[@AndreasSvenska]

He probably bought a house to live in, not as an investment. I bought a house for that reason … to live in. But it is also a great savings plan. The money that would have been for rent, went into the house. And through inflation, today I have a nice house with no mortgage. Having moved often, I live in 3 houses for 3 year periods. Each gained 50% over those periods. That was the 70s and 80s.

[@77space-vt8wi]

5-13-24 Warren Buffet said buying a home was "usually" a bad investment. He was not talking about homes in Southern California within walking distance of the beach. IMO Buffet likes the action of big league buying and selling, the kind that gets his pal Trish Regan going and suitable ink in the Wall Street Journal. Right now he's parked his money in T-Bills as he says "he sees nothing worth buying". Like everyone else Buffet is waiting to pounce the moment Trump walks into the White House.

[@bsways]

More click bait garbage. KZbin has gone down the tube

[@dskinner8757]

Exactly!

[@dewboy910]

It's called "click bait".

[@BobBob-vx4ck]

I bought my town home and I pay 1300, my neighbor rents the unit across from me she pays $2,400 a month in rent for a smaller townhome. Thank God I'm not renting.

[@inertiaforce7846]

The payment by itself doesn't mean a damn thing.

[@BobBob-vx4ck]

@@inertiaforce7846 nice tone, I will try to match it. Think it through. It means she's paying twice as much for the same quality of life. I'm saving half as much money as she is losing. Next step. That means I have an extra $1,100 every month to invest. Maybe investing $1,100 in your words "doesn't mean a damn thing" but that's why we have compounding interest. Hopefully I matched your snarky shity tone.

[@inertiaforce7846]

@@BobBob-vx4ck You didn't account for the interest on your loan. You didn't account for your property taxes, insurance, maintenance and repair, HOA fees, brokers commission and closing costs when you sell which is going to amount to about 8% of your house's value. After accounting for all these you're spending more every month than the other person who is renting. Have a nice day.

[@BobBob-vx4ck]

​@@inertiaforce7846 incorrect that's all folded in with the exception of insurance and that's bundled with my boat my motorcycle and my car. As far as interest it's 2.27% on a 30 year. The house payment is actually $900 the extra two goes in escrow for taxes then in all disclosure I pay an extra $100 every month towards the principal specifically towards that interest you mentioned All In around 1310 which is still a $1,000 less than my neighbor is paying rent for the smaller unit than I own. I maintain a cushion for if I lose my job or my hot water heater goes out. But also make my lunch instead of eating out everyday it's boring but I follow a budget

[@inertiaforce7846]

@@BobBob-vx4ck The total cost of ownership is still more than the cost of renting. You did not account for repair and maintenance or the 8% that you'll have to pay from the house's value when you go to sell it. These eat into your returns. After inflation is deducted your return is basically break even or possibly a loss. Renting doesn't have this problem, and the savings can be invested into index funds. I'm a homeowner myself and I also own a rental property. If the rental property did not have a tenant it would be operating at a loss. It only has a positive yield with a tenant in it. This means that your house or my house is operating at a loss or break even if you're lucky. There's also remodeling costs that I forgot to mention.

[@wreckim]

For Buffett, because of his tremendous talents in the Stock Market, buying real estate as investments is stupid. I remember Jack LaLane saying that playing golf, walking and doing light yoga was worthless; it does nothing to build muscle, and it's not a workout--you're kidding yourself. This is also true for Jack LaLane. But the rest of us mere mortals, that aren't making $100M stock deals, and not trying to swim to Alcatraz, towing a boat full of people, while hog-tied.... buying a home, and walking briskly for 30 minutes a day, is a damn good way to go through life IMO.

[@adamesd3699]

Exactly. I was going to write the same thing, but you phrased it exactly.

[@Far7rom]

Buying a home is great. Buying a mortgage is NOT.

[@arizonalifestylechannel2186]

Well Put

[@Greencloud8]

Jack was an alcoholic

[@Acccountable]

@Wreckim, that was one of the best comments I have read. You are spot on!!

[@GokieReal]

You got to love a rich dude sitting in his big house saying “don’t buy a house”

[@jordanmiller1170]

He has one modest home.

[@GokieReal]

@@jordanmiller1170 it comes down to a simple concept of practice What you preach

[@matthewphillips5483]

@@GokieReal Home prices were less in his day in both absolute and relative terms.

[@GenerationX1984]

Warren Buffett lives in a middle to upper middle income sized home. His kids didn't even know he was rich growing up.

[@penguingobrrbrr353]

@@jordanmiller1170 his modest home in 1984 cost him 34k or something and now is worth 1,5M... so lets be honest... its not MODEST>

[@brendakoldyk1647]

Renting is way worse then buying a house. I should know I been doing it over 25 years and they keep jacking my rent every year. At least with a house you get something out of it.

[@wreckim]

It's never too late. I mean that.

[@crazybabytvworld]

You get nothing out of it. After maintenance, taxes, and unforseen happenings you end up losing Everytime.

[@ent1311]

​@@crazybabytvworld 😂 where else do you suggest parking your money? Stocks are garbage as well. At least with a home you can rent it out, live in it, store items, etc.

[@wreckim]

@@crazybabytvworld My mom lives in a home that's worth $1M, that she bought for $35K in 1976, and rents out the back for $2k/mo....which is a giveaway here in Ventura County. To each his own.

[@markwriter2698]

Correct. Eventually you can sell and recoup. You may make a profit or sometimes not, but you at least recoop something.

[@smileyspoon1]

You don't buy a home because it's a great investment most of the time. You buy it because you live in it. Depending on timing or if you bought it super cheap it could be a great investment. I think for most purposes better to invest it in the stock market. I also just hate being a landlord. I just want to collect my dividends from an index fund and not worry about the details.

[@fattylovehandles8819]

not all stocks are guaranteed

[@smileyspoon1]

@@fattylovehandles8819 nothing is guaranteed. But if sp500 tanks when looking at average return for next 20 years we are pretty much all screwed collectively. Housing included.

[@Chutney1luv]

Buy your home because when you pay it off, you will invest in yourself and not have to worry about nothing but the taxes and upkeep: which is cheaper than paying rent!!

[@schawnettarobinson8584]

I agree. Most people can’t afford to buy in the stock market. They don’t understand it. They can’t handle the downturn.

[@JeganBedpal]

Now is the perfect time to start buying stocks and crypto( BTC, ETH,) if you are just being introduced.. I really wish I started earlier. I’m learning this doesn’t have to be as complicated as some people make it out to be. Thanks to Kerrie Farrell for helping me get into her trading server and investing guidelines. Investing and trading are more than just having TA skills. There is a big component of discipline and emotional maturity, that one has to work on! Time in the market vs. timing the market. If you keep that mentality as an investor, you will stay calm during the storm! Within some weeks I was making a lot more money and have continued on that same path with..

[@JasonGavino-dj6ze]

As a beginner, it's essential for you to have a mentor to keep you accountable..

[@swayhulio]

I appreciate the professionalism and dedication of the team behind Kerrie’s trade signal service...

[@TedStalets]

Kerrie Farrell program is widely available online..

[@rogercav40]

Investing with an expert is the best strategy for beginners and busy investors, as most failures and losses in investment usually happen when you invest without proper guidance. I'm speaking from experience..

[@PatchettStalls]

The fact that i got to learn and earn from her program is everything to me think about it, it's a win win for both ways...

[@edwardmiller9611]

I bought a condo 14 years ago. I own it now. Best and smartest thing I ever did. I did use the G.I. bill and that helped much. No down payment.

[@yaimavol]

Exactly, it gives you stability and an asset in case you need it in the future.

[@peggypeggy4137]

We live in Toronto and bought our house kinda by accident years ago. We had been living in a warehouse beside an abattoir (not ideal) Our friend was leaving his rented house & asked if we wanted to take over for him. We said yes. 3 months later the landlord said he was selling our newly rented house & did we want to buy? Well we sure as hell didn't want to move again so we said yes. Best thing we ever did and I don't want to be at the mercy of a landlord. Toronto a nightmare to rent in these days, Soooo expensive.

[@moomie1634]

Figure I should point out that Buffett isn't against owning your own home, he's saying that owning a home is a bad investment, which he's right about. You can only get money from it if you don't live in it or sell it. Otherwise, it's just a cost

[@InvestorCenter]

Yep

[@romerome6968]

No. Disagree. You can get a line of credit. Heloc.

[@moomie1634]

@@romerome6968 Investing with debt is insanely risky. Most people should invest with cash flows, not debt.

[@romerome6968]

@moomie1634 I would agree if it's a personal home. But what if it's a Rental property .

[@moomie1634]

@@romerome6968 that's an investment, which is not what buffett is talking about

[@CurieBohr]

I own my home. The 2 to 3k others pay monthly on rent goes straight into investments. Buying a home is great. However, the way things are going, I expect property tax to 5x in my lifetime at least

[@superdog797]

out of curiosity how much do u pay on monthly property tax, average monthly repairs/maintenance?

[@Fernando-of4cz]

Nothing better to sleep well, than to own your home…. Warren Buffet should know. Also, if that is the way he thinks, why was Berkshire buying so many homes/houses???

[@InvestorCenter]

Berkshire doesn’t buy homes. They own a real estate brokerage

[@alecprentice1573]

@@InvestorCenter: So Bershire takes advantage of dumb people? lol

[@CurieBohr]

@@alecprentice1573if you buy stock in Pepsi, aren’t you taking advantage of dumb people that drink that poison?

[@ChrisE1415]

"Nothing better to sleep well, than to own your home" Until a pipe bursts, the toilet get clogged, a storm causes something to break your roof etc

[@CurieBohr]

@@ChrisE1415 that’s what the emergency fund is for. And just think how big that fund is when you don’t pay rent monthly cause you own your own home.

[@mikepiper6077]

It depends. Sometimes renting is smart. Lived in northern California and found a studio close to work for 500 a month and most utilities included. Walked to work. Tje job paid adequately, and because of cheap rent was able to enjoy a lifestyle of dating , saving, and investing. Other times owning a house worked out well too. Once again it depends and finding the the appropriate choice solution at the time. The wrong choice can be disastrous too. Seek inspiration from on high and be humble and wise enough to ask and act on it. .

[@foreigncontaminant2015]

Investing conservatively and then buying a house with cash is a really good investment. No debt, no worries, and then whatever money you save next can go into stocks...

[@Zulonix]

Buying a house and paying it off is a GREAT investment in peace of mind !!! Living a debt-free life is the best !!!

[@joserivadeneira7361]

Yeah, but first invest, then buy.

[@MarkShy-sz8zo]

Start off 20 percent for maybe 10 I did and gad 100 k in equity

[@jumbojet8]

No such thing if you pay property taxes. That is rent to the govt that inflates over time and compounds. You never really own anything with va Taxation theft.

[@matthewphillips5483]

This is the way. Buy a house only in cash or forget it. Mortgage is a scam.

[@penguingobrrbrr353]

@@joserivadeneira7361 everyone is saying that and thats why below 50% of western europe or even US people do not own properties. If you check out Eastern Europe for example people are pro- properties. They choose properties first than anything and after a decade 90% of your population is not paying rent and is basically living a chill,cheap life.

[@Uncommonsensetoo]

Well, this is certainly one thing you cannot generalize. The right answer is: "it all depends on the situation". In my case buying a house has been a very smart decision. I bought it when house prices had dropped a lot after the financial crisis and as prices started to rise again and got a 3% mortgage rate. In the past 11 years my house has doubled in value. I also rent out most bedrooms in the house and the income from that pays all of my housing expenses including mortgage, taxes, and insurance and I still have a chunk of money left over. I do all of my own maintenance and improvements myself and can deduct those expenses, cleaning products, as well as, several thousands in depreciation from my taxes because I rent out. My house has not only saved me from paying any rent but it has been a great money maker as well.

[@themightiestpen]

It’s so funny how offended some people get when you say buying a home is a bad investment. She isn’t saying you shouldn’t buy a house, but from a strictly financial perspective a home is not an asset, it’s a liability until you pay the mortgage. Until then you own nothing and the bank owns you. The bank is the one who wins, and you pay as much in interest as the home was worth in the first place. Stay broke homies!

[@dbsk06]

Exactly

[@daw7773]

It depends if the stock is not in a long term “bear” market like in 2007-2008 losing 35% can take over 10years to regain the loss in profits.

[@MickeyMouse-xy6op]

💯

[@jmortier71]

Bought my first house incl. Renovation For 175k. Sold it 7 years later For 300k. Bought an other for 375 incl. Renovation and sold it 9 years later For 875k. I guess it there are a lot of factors to think about. But i'm happy at my 45years.

[@wegotthis247]

Your breakdown isn’t quite accurate - the home is an asset BEFORE the mortgage is paid off. You’re able to tap into the equity for a HELOC and you receive the equity if you sell plus you have a tax deduction each year. Renting there’s no equity or tax deduction j/s

[@Practicallife24]

I agree with what you said. At this point it makes no sense if your going to buy at the median home price. The only way it's ever going to work is if you buy a junker in a good neighborhood and work on it yourself.

[@johnlibonati7807]

100%. Bought my fixer upper in 2015 for 1/5th what I could sell it for today. Totally paid off. Biggest thing is knowing the difference between cosmetic issues and structural problems. I had a general contractor friend walk through and check out everything before I pulled the trigger.

[@leojboby]

How do you compare the opportunity cost if you consider the entirety of the life of the house, as in, at the end of you will have an asset worth 500k+market gain. I believe a more apples to apples comparison of opportunity cost might be how much you have at the end of the 30years by investing the difference ( cost of owning a home - cost of renting).

[@lesleyjohnson8488]

I agree with you 100% on the strict economics of buying a home. At the same time, since the vast majority of people are not as rational as Warren or Charlie, and tend to dump good investments on a downturn and buy overhyped securities as the pendulum swings bullish, I think the lack of liquidity in a home is actually a feature, not a bug. That is, for the vast majority of people. I’m managing money now for several friends and members of my family because they have figured out that they are not as rational in market swings as they initially thought!! Great content, as always 😊

[@usaveteran1813]

I bought my first house in 1975. Here's what I have learned. Over the long term houses appreciate at the rate of inflation. Then the interest, taxes, maintenance and insurance become your "rent" expense. It is cheaper than renting but you need to be very careful. Never buy a big house in a high-priced locale. My two homes were priced way below our ability to pay. Added to that, my cars were all purchased based on reliability and safety and I drove them until the wheels fell off. This simple tactic took me from zero assets at age 21 to the top 2% of net worth. And I actually did not sacrifice much in life at all. Be guided accordingly.

[@user-wl6wx9xd9k]

My house was bought in Hawaii in 2008 when the housing market was low for 230k, my home with renovation is now worth 855k I am paid off and definitely see it as a great investment.

[@joumasekoek]

My partner and I decided to invest in real estate 30 years ago (our first property was a rental because we couldn't afford to live in it). We've always had good jobs, but not rockstar jobs. No stocks or bonds ever. Today our net worth is approx $8M. My renters paid for the vast majority of that. Thank you renters.

[@luxurylife7464]

You also said “you have to consider interest rates.” Buy a house in cash and no need to worry. Not to mention, you have some leverage when buying in cash. You can get a nice discount for quick closer. Be smart with money and you can buy a house outright. With cash left over from a prior sale. I was able to pocket over $250,000 after I sold and bought my new house. No. Interest. Rate.

[@joserivadeneira7361]

Correct. I see it as, invest and secure financial stability before buying.

[@narbwow8168]

You might not be paying interest but you are paying the opportunity cost of having that money invested in a house as opposed to another asset class (e.g. S&P500). And over time the market tends to substantially outperform residential real estate.

[@luxurylife7464]

@@narbwow8168 you’re right. But having a content wife is worth the opportunity cost. And I can always borrow off my house if need be.

[@mvann5]

Where were you able to do this? Would be hard in a big city like l.a. ?

[@luxurylife7464]

@@mvann5 in LA, yes. Not Arizona though.

[@peterpahor8228]

I moved closer to Santa Clara a few years ago ,I’m a new dad and I’m thinking of purchasing a single family home there, but with real estate prices currently through the roof, is it still a good idea to buy a home or should I invest in stocks for now and just wait for a housing market correction? I heard Nvidia and AMD are strong buys.

[@elenib3052]

it’s a personal decision, but according to Forbes, housing activities will remain stagnant for the most part of the year, so maybe hold off a little.

[@zakeryday]

well you could put a downpayment on a home and as well diversify as much as you can into Ai and pharm. stocks like Pfizer and JnJ.

[@caryishnagardner9429]

Certain Ai companies are rumoured to be overvalued and might cause a market correction, I’d suggest you go with a managed portfolio, but even those don’t perform so well, so it’s best you reach out to a proper fiduciary to guide you, that’s what works for my spouse and I making a whooping $738k in Q4 last year.

[@peterpahor8228]

this is all new to me, where do I find a fiduciary, can you recommend any?

[@caryishnagardner9429]

‘Monica Mary Strigle’ is the licensed advisor I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.

[@hannible1002]

I brought my house at 25 but paid it off by 40. I now live in a farmhouse in France with no mortgage and retired at 55. If I had to rent I would not be retired. Rent is about €700 per month.

[@jay1q2w]

Not an expert but just through my personal experience, rent goes up every year. My rent started at $780 and by the time I had enough it was at $1100. Every year rent went up $100. I can imagine what that apt is going for now or I stayed. I found a home for just $100 more. It had everything it needed, washer, dryer, refrigerator, deep freezer, and microwave. Did I mention I got a garage, extra bed room, lil office space, shed building, and a yard for my dog to go in and out of. Guess what, my mortgage has relatively stayed the same over yrs. Plus, my home value has doubled.

[@Javalipapere]

It’s a great investment to buy a home. Your title is misleading as we bought a home 31 years ago and the value it increased enabled us to buy a home larger 4 years later. We have 4 grown children and paid $80 k for house and now paid off and worth $300 k. Emotional strength of owning house outweighs everything

[@TeeroyHammermill]

I was a great investment for you and your family because you needed one.

[@yourseatatthetable]

No offense to Mr. Buffet, but when my Mortgage is 40% cheaper then the rent of even the smallest house in Des Moines, I'll stick with buying mine.

[@isitjustmeorwhat9748]

If you're a strategic buyer. Purchasing a home under the right circumstances can be very beneficial to your net worth. I bought a new construction house pre covid for $420k. Two years later, that house was appraised for $625k, so again, it's worth it if it's done in a strategic manner.

[@aussietaipan8700]

While there are indeed costs to owning a home, if done correctly the costs of the mortgage reduce with every payment, at least in Australia, while rent always goes up and there is there is a real risk of renters being kicked out due to the sale of the property or landlords put the price so high that the current renters cannot afford to stay. And the last statement is so so true.

[@corgiowner436]

Ignoring the fact that you had use of the house while you owned it.

[@zenastronomy]

these guys are so rich and detached they don't realise how expensive renting is. if they did. they wouldn't be saying this. they probably think a house is cheap like it was in 1950s and renting is even cheaper.

[@lianalonge1984]

I bought my 3 level condo with 2 beds & 2 baths in 2010 for $185K @ 4.25% in Howard County; one of America’s top 10 wealthiest counties. Today my condo could easily sale for $310K due to the renovations, the market, and location. I’ve also refinanced at 3.25%. And get this . . . there are 4 for sale right now: 2 under contract while the others are still pending. And the condos go very quickly despite the hefty $543 up to $689 HOA, depending on the style (8 different floor plans). I’m glad I bought when I did, although I understand that in some cases it may not make sense to buy a home.

[@gustavonavas727]

Thank you for the information and especially the diction and softness of your explanation is a great way to start the day. Happy Week and more content!

[@InvestorCenter]

Thank you 😊

[@cynthiamartini8982]

@@InvestorCenter Sorry but your information is completely faulty!!! You haven’t taken into account that with the purchase of the house,in this example, one would make €2000/month on rental income or, they wouldn’t have to pay €2000 on rent (got to live somewhere !). Either way, you’ve forgotten the fact that the property is worth €24,000 per year!!! (That’s before appreciation). Buffet was only pointing out that if you don’t need a large house to live in, don’t purchase one as they’re expensive. (That is, until you have a family).

[@ThirstyforTruth]

Also if you sell a house the profit you made if you're in it for more than three years is tax free... Stock market profits… Nope. And they're not always profits.

[@prophetseven728]

up to $250Gs You still have to pay tax on anything above that.

[@penguingobrrbrr353]

Imagine having millions in stock market and you end up paying taxes... UGHHHH. I choose real estate over stock market. I just dont pay taxes on real estate and its so amazingly made and most rich people are made from this type of investments.

[@prophetseven728]

@@penguingobrrbrr353 I invest in both. Realstate you do pay a lot more taxes. You get write offs. But you have to spend money for those write offs. And you want to make the most out of your property by renting out. Which is not passive at all. You can make good money, I do. But it work as well. Unlike Stocks where you make dividens and do not get calls from tenants telling you their plumbing is backed up. Also more people make way more out of stocks. Much more Rich people in that field. Like I said I do both. Cheaper to get into stocks so starting out it is way more cost effective. You can borrow and leverage with property. But than you are in Debt. They are totally different beast. If you do construction like I do. You will have an edge on property. But Im favoring Stocks more. Less Government control than how the government controls your property. It getting insane. Well at least in my Democratic state. They just want to control you to much and take to much from you. Pick your poison!

[@kansasterri5977]

My small home is now paid for, and so it is saving us about $1000 per month. Your mileage may vary.

[@Aubatron]

Long term S&P500 average return would be $1,466 per month on 160k. It also compounds because it is a productive asset. In 10 years it would be returning $4,646 per month. In 20 years, it would be $11,824 a month. Of course it wouldn't be consistent and you wouldn't be withdrawing from it. Personal residence are inferior for building wealth because they don't compound interest, but if you're living off of the 1,000 in savings from it every month, that's a great position to be in.

[@kansasterri5977]

Ah but I live in Kansas where property is cheaper and income is lower. I paid only $75,000 for my home, and that makes it somewhat more comparable to the S&P. However, I am NOT taking the equity out of my home. The average apartment in my area is now up to about $1,600 per month, while my home taxes and insurance are only about $600. That means that we can easily live on SS, savings, and a pension. In fact we can add a bit to savings every month, which gives me a feeling of security for the future, as inflation is very real. In fact the home I paid $75,000 for is now worth at least twice that, just from inflation. LAstly, I did NOT pay cash for this home: if I had been putting $75,000 into the stock market I would have had to borrow the money for it, with all of the usual interest payments. @@Aubatron

[@BobBob-vx4ck]

@@Aubatron I bought my house for 265 my neighbor just sold their smaller unit for 500K in just under 5 years I've almost 100% doubled my money. Now that same property is being rent it out for almost a double what my mortgage is.

[@Aubatron]

@@BobBob-vx4ck But do you expect 2019-2022 to happen again? Historical average is 2-3% a year. 1992-2023 is 4.6%. A 5 year double is amazing and you’re lucky. The historical average of the S&P takes 7 years to double, 14 years to quadruple.

[@wegotthis247]

@@Aubatron you’ve leaped to WEALTH building; I believe most homebuyers are looking to cover the need of HOUSING and are not looking at its purchase as a means to build WEALTH. The equity and tax deductions are a bonus but not many are looking at it from a wealth building POV …unless they are a real estate investor flipping or leasing several properties. I’m in the DC area, bought in 2017, I’m @ 3% and equity @ 100+k…and

[@nierautomata9654]

Well it depends..i lived by myself and bought a brand new house way back 2018 with 3 beds 2 bath but its far from work and in a small town so i sold it last 2023 and made some money from it then i moved closer to work and just bought a 1 bed 1 bath brand new condo in the bay area..its much more expensive than my house before but living in a city thats closer to job opportunities and less cleaning coz its small space is worth it plus the fact that im not renting and can just simply sell it again in the future if i have to 😆

[@umbleyoself3624]

If you view it as an investment, then it truly is a lousy one. But if you need a place for shelter, to lay your head, it is going to cost you something. I am fortunate to live in the South where prices of homes are not outrageous. Peter Schiff gives the same advice but if you purchase a house north of $250K I agree with them both. You must buy smart.

[@rezlogan4787]

All valid points. Too bad I have a wife, or I’d have an extra $3,000 a month to invest.

[@reignrobinson7951]

😂

[@dennyfie]

Lol

[@johannakamstra-schickendan7380]

Great video, you do the perfect maths. My father and later my husband explained it very well to me; if you do not have the money to buy your own house you simply cannot afford a house. They explained the math for me and it was the same you explained. Almost my whole life lived in owned and paid for houses but today (at the age of 75) I live in a rented house since 10 years and discovered all the advantages of renting; no costs for the upkeep of the house because it is the responsibility of my landlord. Above all I have my FREEDOM.

[@smileyspoon1]

Yeah. I own my own townhome but that's because wife wants to own. I love to rent stuff in general such as boats and RV. You don't have to take care of it if you don't own it. I think we'll eventually be renting when we retire. I want freedom to move around if the kids settle elsewhere.

[@AroundSun]

Freedom? until they jack your rent up $250 per month next lease and keep doing it the following years, or kick you out for another renter, or they sell the home because of market conditions. Renting is not freedom.

[@angelalaskodi3459]

Owning a home is freedom. Not renting.

[@moneysmartsmallbiz.]

owning a home..you HAVE to keep a JOB. renting allows you to stay mobile...you can change jobs if you need to and move around the world!

[@rob-fb5xs]

My mortgage is paid off, I pay $20 per month for insurance, about $100 per month for maintenance and $140 per month for U.K. council tax (property tax). I’m planning on living another 40 years in this house and when I die my two daughters will each get half a house. Rent for an equivalent house would be $1300 per month and forever increasing. I reckon buying is cheaper for me now. No one I know ever got rich by renting. got rich by renting a house. By the way my daughter’s grubby little student house is $60000 a year to rent, split between 6 of them.

[@Ironstarfish]

Saved up 20k and bought a house while living with my parents, took me 15 years to pay it off after I moved in. I was like 26. But it sucked and I'm glad I did because now I have unforeseen health issues so now it's less stressful than the expensive rent that never goes to principal. Paying rent for 20 years and miss payments and see what happens and yes things break I'm the house all the time but you have to grow up and become responsible

[@RG-mi2wj]

I bought my house 2007, and now I rent 2 rooms in San Diego ca. My roommates pay my mortgage - I have not payed mortgage or rent in last 7 years. If I go and rent I would be paying no less than $1,500 a month. Is this good or bad?

[@TeeroyHammermill]

It's both. It's good because you're making money, it's bad because you got roommates

[@EricRaymond762]

I will be forever grateful to you, you changed my entire life and I will continue to preach on your behalf for the whole world to hear you saved me from huge financial debt with just a small investment, thank you Michelle Stewart.

[@Angelinaanderson_343]

Wow. I'm a bit perplexed seeing her been mentioned here also Didn’t know she has been good to so many people too this is wonderful, I'm in my fifth trade with her and it has been super.

[@Elaineburkett]

She is my family's personal broker and also a personal broker in many families in United States, she's a licensed broker and a FINRA AGENT in United states.

[@AlfredJason159]

You trade with Michelle Stewart too? Wow that woman has been a blessing to me and my family.

[@KathyMarbles]

I'm new at this, please how can I reach her?

[@EricRaymond762]

she's mostly on Telegrams, using the user name.

[@77space-vt8wi]

Just about everyone I know made their money buying and selling real estate and/or via the related 1st and 2nd T.D. home mortgage traffic. The best thing about home ownership is that's it's not an apartment with thin walls and you have a secure guaranteed place to park several cars, trailer or boat.

[@Bertuzz84]

It would kind of suck to buy at 7% interest. Here the interest rates for 30 year fixed are at around 4% still which is pretty sweet. The main reason to buy a home atleast before you are 37 is that you will not have a rent or mortgage payment by the time you retire at 67. I like how my mortgage payment is still the exact same as when i bought the house years ago.

[@DidiPetalz]

We need this information, failure is inevitable when knowledge is failed to apply, why allow poverty rule ???

[@KelseyBrigham]

I firmly believe everyone striving for financial independence should own both coins and real Estate. The percentage weighting of each asset class as part of your portfolio will then be up to you to decide.

[@Lukastrump]

Facing this recession without investment is actually risky, salaries are easily spent off

[@MarisKumar]

Yeah and Indeed investment has liberated a lot of families out of poverty, I recommend it to every bread winner out there.

[@SimonBaker-ez9ru]

Citadel Moore Has Really Set The Standard For Others To Follow, We Love Her Here In The UK, as she has been really helpful and changed lots of lives

[@LunaMia-gw9uo]

A CNBC News hosts, spoke highly big about this woman and her loss preventing strategies. Been trying to reach her since, thanks for the information

[@Sydgekd]

STOP. I bet he own a house right now.

[@childfreesingleandatheist8899]

I don't care about being or not being a good investment. I have a house with an attached garage for the privacy. I would hate living in a duplex, apartment or any other house in which I would have to pay rent to someone. The feeling of living in a house is the best.

[@Michelle_McKenzie]

I bought a 2200 sq foot home that was 13 years old for $125k . No PMI since I used one of those programs she didn't like. My mortgage payment was $888. Now due to the boom it's 1000. In my city, a 1 bedroom in the bad area is $1100 a month. For a 4 bedroom is about $2500. While I agree with her numbers for extremely high cost of living areas. I think most people don't like in extremely high COL areas. They probably live in low to moderate cost of living areas. So most people aren't getting 500k mortgages. I've also never spent an average of $400 a month for repairs. Need a new roof, use your homeowner's insurance. Need other repairs in your house get a home warranty for $50 a month and your deductible is $125. I don't think I've spent a total of $5000 in the 8 years I've been in my home. The biggest purchase wll be a HVAC system in the future. That averages $6000 for heating and cooling. Divided over an average of 20 years, that's $250 a year. Also with the average person making 55k and the average family earning 80-100k, most people aren't losing the opportunity to make investment purchases. they never had the opportunity to begin with. They are lucky if they can afford to match their company's 401k match. I do agree, only buy a house that is less than market rent.

[@Quason788]

I’m a new dad, I moved to the Bay Area a few years ago and I’m thinking of purchasing a single family home, but with real estate prices currently through the roof, is it still a good idea to buy a home or should I invest in stocks for now and just wait for a housing market correction? I heard Nvidia and AMD are strong buys.

[@Meepoli]

Bay Area is just so expensive, so it’s first justifying buying at all and then being okay with doing it at double the investment scale of other cities/regions. So more like “is it worth buying two homes?” I actually did buy recently in SF based off the “the best time to buy a house is when you want to buy a house.” I like it here, so not having the shit hole argument - my place is gorgeous to me. I have enjoyed it when I disconnect from the returns I now don’t make. My family makes ~$400,000 together with secure employment and no heavy risk, so a million dollar home is doable, and yes, if we instead invested in lucrative opportunities or started a side venture, we could make more, but it would require time and effort and risk. I’ve always been a conservative investor preferring say $200,000 growing at a guaranteed 5% in savings over risking 20 separate pools of 10,000 investments with some 10x ing and others hitting 0. Basically not a VC guy. So I’m huge on HYSA reserves and ETFs With the home, I compared with 5% opportunity cost gains as opposed to 10% in the stock market example from the video, and I forget now my home value assumptions but it was modest and then still was kinda close from my analysis of money saved from renting vs owning. I believe after many years it eventually eclipsed the cash gains, but even if it didn’t, that’s years without a home of your own, and to me I preferred the bigger space and potential to rent it out myself 10 years from now. So for you, if you have $200,000 sitting around, and you haven’t been increasing it 15%+ per year, then buy a home and don’t pay mind to what these super investors say you “need to do.” If you are growing your money fast and don’t need the home this year, you probably should take the advice of having $1-2 million cash before you put $100-200k down, and then hope by then interest rates are below 7 I’d rather die a happy millionaire then die a sad billionaire so I do what sparks joy and doesn’t make me broke.

[@Meepoli]

And please do not take offense, but if you’re just hearing now that NVIDIA and AMD are strong buys, then it’s likely better for you to just stick with ETFs and buy a place imo, as keeping up with the market is hard, and that’s sort of been old news. While they are good buys, the fat cat ship has sailed since NVIDIA already went from $100-$900 in the last ~4 years. Still probably going to hit $1000 and continue over the next couple, but for it to actually 9x AGAIN, it would need to reach a $18 trillion market cap, which would be the largest market cap in history - (Microsoft is at $3 trillion right now) So yeah - I like to think I’m sharp, but I’m not sharp enough to know everything so I let the ETFs, real estate and guaranteed growth do it for me. Your call what makes sense for you.

[@mvann5]

Hmm, May have question for you... But it sort of long.. ?

[@greylindjames1786]

I seen many video about renting vs owning. I have yet to see a video explain how renting help your net worth?

[@AroundSun]

The only way would be if you had a cheap rental and dumped whatever you would have spent on a house and higher monthly mortgage payments into the markets, then over time, you'd net enough to buy a house cash if you wanted to plus some more. This means spending the down payment and closing costs and monthly mortgage principal, interest, taxes, and insurance and repairs and maintenance, landscaping, pest control, property taxes into the market. But the opportunity cost is you have to live in a rental and possibly forego having a family, etc. All depends where you live honestly. I think a house is a smart move because not only can you live in it, but it increases in value, can be sold, rented, used as collateral, etc.

[@matthewphillips5483]

The money you saved for a down payment + closing cost + repairs + rent being cheaper than a mortgage payment almost everywhere now means you invest the difference in the market (index funds average 10-12% returns annually). That will increase your net worth quickly! Renting is insurance.

[@fremontpathfinder8463]

You don't buy a house for an investment. You buy it for security

[@CharleneCong]

It's crucial to diversify and not put all our eggs in one basket, as Warren Buffett wisely emphasizes. One thing I've learned over the years is the importance of building multiple streams of income. Whether it's through investments, side hustles, or passive income streams, having diverse sources of revenue can provide stability and security in the long run. Great video!

[@LILIMIAMIMUSIC]

I bought a condo in Los Angeles on 4.6% with "no money down". Turned out, It was another loan of 16k with 4% (when I sold, it came out of my profit). It wasn't free. Plus I had to pay private mortgage insurance of almost 200$ every month. lol The best decision I made was when I sold that fucking place..... OMG.... SO happy I got rid of that liability. Not only these money grow way better on a stock market index fund (VTSAX is my favorite), but also, when you own a place you have to pay HOA (it can grow btw) , property taxes, , insurance, PMI (private mortgage insurance. If you put no money down). Plus, all the repairs AND the repairs inside the building. When HOA decides to remodel, YOU are paying for it. And there is nothing you can do. When you own a home vs a condo, its even more expensive to repair things. Home is a dilapidated asset which slowly falls apart. lol And you never own it until you pay it off. You basically renting it from a bank. If you put money down, you lost opportunity to benefit from 10-11% stock market index fund is bringing (on average for the past 45 years). Now when I was selling it, I got hit with tons of seller fees. That cut profit a lot. Now, the remodeling I did....Things like new kitchen or bathroom doesnt increase value. SO, no matter how much you dump in that fucking place, no one will pay more for it..... What a shitty investment.....Even if you rent it out, you will profit waaaay less than hustle free stock market would do. And no headache with renters needed. With what I paid through 5 years I owned it I could've lived by the any LA beach. Now I rent an amazing apartment with a view on boats on the Marina del Rey and I put money ONLY in stock market index fund. Mark my words, no matter how much money I make in my life, I'm not dumping money in any home. When you rent, you can live anywhere you want and have ZERO responsibilities. One benefit I had owning that condo was that I had some money when I sold it. Which is not much consider the remodeling I made. BUT..... Its good to have good amount of money at once. I would've spent it otherwise. Now, all the money is in the stock market and will be there forever. All I have to do is withdraw some of it over time and let the rest grow.

[@johannakamstra-schickendan7380]

Agree, buts there are some buts……if you can afford a home and pay for it 100% it’s okay and if you are intelligent enough to realize that owning a home will come always something to keep it in good shape ( painting, plumbing aso)it’s okay, you live in it and pay all the taxes and insurance also okay. The biggest problem is that you can’t take it with you so it’s a stone around your neck, you lose your LIBERTY. The advantage of renting is that you close the door behind you and go where ever you want. The home owner will not go through a legal process to get you because it’s far to expensive for him. FREEDOM that the most precious in the world but the majority of people do not realize that they are just STUPID.

[@LILIMIAMIMUSIC]

Yes, but if you do the numbers you will realize that paying home in full is not a good investment because this money could bring you much much much more in the stock market index fund. Buying a house is good for memory building, kids and stuff like that. Basically you are investing in your piece of mind and Security. But there is a great quote about security :”those who trade liberty for security, deserve neither”. I would buy a house when it’s like buying an iPhone compare to net worth. Like “whatever, might as well” lol although I like living alone and I do t want any kids or even pets. So for me being a homeowner doesn’t make sense. I love my freedom and responsibility, free life

[@EL-L0B0]

Homeownership isn't for everyone, but things might have been different if you'd had chosen a property without an HOA. I find real estate a very worthwhile investment in the long run. & There's an opportunity cost to anyone that subscribe to rental lifestyle, too. That rent money isn't earning any returns. Whether someone decides to rent or own is about what suits your lifestyle & financial goals the best. It's awesome to hear that you've found a system that works for you!

[@Simply_JustKim]

This from a man who owns a house.

[@ChrisE1415]

I didn't say that. I was saying that if you run the numbers, especially in a more normal real estate return environment, it's not the unbeatable investment many make out. I don't own one at the moment, but I'm single without kids and might get one when I have a family. If housing is such an unbeatable investment, maybe you should just borrow as much as you can and buy as many houses as you can. If you can't lose with realestate. You should probably also sell an online course teaching others how easy it is to make money in real estate like you.

[@mariomadrigal441]

He's right, the introduction of "compound Interest" by the Federal Reserve. Makes paying a mortgage astronomical. You will pay over 30 years several times the retail price of the house. Which, by the way, is already marked up 100% by the developer. Add to that how many things can go wrong over a 30year period. Your rolling the dice!

[@flash521]

Warren Buffet is NOT renting his Omaha house.

[@leonbailey8980]

The future belongs to those who believe in the beauty of their dreams. Success is a state of mind. I think I'm blessed because if not I wouldn't have met someone who is as spectacular as Expert Mrs Lucy Mary Liam.

[@donnadudley18]

I'm glad I was introduced to forex trading and got the best teacher and mentor who helped me understand the financial market I'm grateful to Mrs Liam🙏

[@bensonarmstrong7287]

It's a miracle and I would testify, $110,000 every 4 weeks! I now have a big mansion and can now afford anything and also support God's work and the church.

[@samstrong912]

I have made more than 90K USD God bless Lucy Mary Liam God bless United Kingdom 🇬🇧

[@johncuevas4415]

Thanks for continuing updates I'd rather trade the stock market as it's more profitable. I make an average of $34,500 per week even though I barely trade myself

[@kristenszabo138]

After I raised up to $325k trading with her I bought a new house, bought a new car for my wife here in the states 🇺🇸🇺🇸 also paid for my son's surgery (Oscar). Glory to God.shalom..

[@darkgardenrecords9264]

I agree, so long as you are making money of some other, safer investments, while in that rental.

[@brandonhavis8526]

This also doesn’t take into account that you will need to remodel that house’s rooms, kitchen, bathrooms and exterior. Assuming you only have to remodel once in your life owning that home, it can cost 25%+ of the homes value for 1 full home remodel. Renters don’t deal with this. On the other hand, these numbers don’t take into account the fact that you eventually pay off the mortgaged home and no longer have a house payment. Both have their advantages but over the course of your life both probably end up costing you around the same amount. My personal opinion? I feel like younger people, especially those with a bunch of kids are best off to rent, save lots of money and when all of the kids are moved out and it’s just you and your spouse you take your savings, pay for all or most of a modest house that fits just a husband and wife into retirement and beyond. The modest house is cheaper in every way. Just my opinion, you gotta decide what is best for you but each persons situation is different

[@anniediaz8247]

I have told my children buy a house have it paid up by the time you retire.

[@bl1707]

Renting is saying to the landlord: just kick me out whenever you feel like it.

[@Man_of_TheWay]

Look up the amortization schedule for whatever house and mortgage youre looking at? Even if you pay it off in 50-75% of the original time, you will never see a full return on your principle, interest, and input costs over the term of your mortgage.

[@ADAMSIXTIES]

You forgot to mention HOA fees if it's a condo. Renting is cheaper than buying and with a lease you can move easily. Once you buy it you decide to move you have to sell and possibly buy again.

[@seanmoore7207]

I love how people that have bad credit, can't afford to buy a house or made bad financial decisions when purchasing a house like to say this to make themselves feel better. Its totally relative. If you bought a house prior to 2017 which millions of Americans did. Owning a house @ a 3% mortgage was a great investment. But if you were a knucklehead and you over paid. Buying a home at the height of the market when everyone was telling you it was the height of the market, and then you didn't come in with a 20% down payment. Guess what? It probably wasn't a good investment. But thats your fault. That doesn't mean that buying a house is a bad investment.

[@ChrisE1415]

But you're not paying rent because you're paying a mortgage, housing expenses, opportunity cost of money invested in house, etc. As the video said, only if the cost of all those are less than rent does it make sense to buy. Buying has its own unique set of costs

[@dkennell998]

The "time to buffet" timer is much appreciated, lol. Definitely builds trust that you're not clickbaiting.

[@Toni62R]

My home is not my investment, it is my castle

[@archiehendricks6093]

Timeing in tour life is key, what is too much money for me can be workable for a young person, if interest rates are low, 7&8% is not low.

[@paulbo9033]

Unfortunately in the UK where i am, it's both the most expensive ever to buy and the most expensive ever to rent. It's actually become a serious systemic problem. The vast majority of young ppl families in particular literally cant buy because a) the avg house price is way way way higher than the avg salary b) even if housing was within reach they can never save enough because there is no real surplus after paying rent.

[@pteronwavefounder]

areas you didnt touch are accessibility & depreciation. House owners are predominantly far from work , school, sports facilities etc, when compared to rental . home owners lose even more considering cost of commute along with their time wasted in the commute. Depreciation of property is another huge one when considering the next gen homes that is built with smart tech, future smart hvac ,solar roof etc .

[@MC-gj8fg]

Most people like spending money and do a poor job of investing for the future. The best thing about owning compared to renting is that after 30 years of spending the disposable income after all liabilities under each circumstance, owning at least results in your free and clear possession of an appreciated asset. You'd like to think that the renter took the money that would otherwise have gone into home repairs and socked that into the S&P rather than spending it at the bar, but at the end of the day one of the greatest flaws in decision making has historically been proceeding with what looks good on paper without factoring in the deeply flawed nature of humans, most of whom utterly lack the self awareness to pursue a policy of nosce te ipsum.

[@Otto72ish]

Good piece. Buy one home that's adequate. Anything else is wasted capital, and extra overhead in terms of taxes / maintenance, plus time.

[@InvestorCenter]

Thank you! That’s a very good point you made

[@AD-xq1pl]

It is just a game you need to know how to play it .when you you buy first home you are learning first listen about real estate then you can make it investment and start your business forward or you make liabilities and start loosing money the point is who you are ? I do not need warrant or who ever to guide me every person has on life do not try match it someone else

[@rodbrown7284]

But the mortgage payment includes the principal which is not a cost, only the interest portion is. As the principal is brought down so is the interest cost. The faster you pay the mortgage off with extra repayments, the less interest you pay overall. Also, the value of the house generally increases over time which, if you didn’t overpay for the property initially, will realise a gain when you downsize later in life or leave to the kids when you pass on. I’ve watched a few of these videos and I still don’t get the argument. I do like the “only buy a house when you need one” comment though.

[@matthewphillips5483]

How many people actually do well with homeownership though? Compare it to the number of people who get equity and then immediately pull it out in a HELOC to remodel or invest in another property. No mortgage. Buy in cash if you want but mortgage is a scam.

[@dannyjohnson9628]

Buying something you use everyday is not a bad investment. That would be like saying buying food is a bad investment.

[@yvonnepoole141]

The biggest problem right now, in Louisiana, is that the homeowner's insurance rates are thru the roof. And God forbid, if you have to carry flood insurance. My note just increased on my main home by $300 a mth because of insurance rates increasing. I dont even have to carry flood insurance on this house, but I do anyway, just in case. I have a rental house that my note also increased by $200 a mth because of insurance. If I put a new roof on it, I may be able to find a cheaper insurance but no guarantees. No insurance companies are writing new policies in Louisiana right now. I have a 2.45% interest rate on my home and 4.75% on the rental, which are both great. But it doesnt help if they keep raising the insurance rates. My tenant in my rental house has been there over 8yrs. A single mom with a special needs child. She can't afford to pay another $200 a mth in rent. She is a good tenant. Pays on time every month and takes excellent care of the house. I don't want to take a chance on getting a bad tenant in there, and I just can't burden her with trying to raise her rent. I dont have 20K for a new roof, so my husband and a friend of his who is a roofer are going to do the labor, and we will try to get the materials wholesale. And it still may not get a new insurance company with lower rates. Louisiana has good prices on homes, but now that interest rates have gone up and insurance rates skyrocketing, if you can even get a policy, most people are just hanging on to their homes because they bought them when the interest rates were low.

[@oakfat5178]

Thanks. You broke down some concepts into portions I could understand.

[@InvestorCenter]

Glad it was helpful!

[@tenaguin1054]

It all is based on the details of the home. Some people who buy homes the smart way do well. Bidding wars is not the way, you end up in a bad position of equity which is the asset.

[@krjourneyfan78]

Considering that my 2800 sf home has more than doubled in value in twenty years, that my mortgage is less than the cost of a one bedroom apartment in my region, that I have a lovely garden where I can entertain guests and hold nice parties, have lots of room to store things and a two car garage to keep my cars and vehicles safe from theft, that I’m not living in some urban core city with homeless people everywhere, I think I’ve invested well in my future, my safety, my security and a nice quality of living.

[@nowonderilake9007]

They both have pros n cons Here me out your taking the most risk as a homeowner so by law the price is higher you have to pay cost to be boss Example if joe buys a car 2500 yes he owns the car but its hidden fees Car ins, gas, tires,oil change,maintenance,tax title lic, pay to park in certain places See where im going Now how is owning a house any different its same hidden fees Elec,water,gas,h.o. ins,food,internet,maintenance,yard And it usually takes on average 30 yrs to payoff so add all that up x30 or 20x how ever long it takes to pay off, and dont forget the interest rate at 7% that can be over 100k depending how much house is your income going to stay the same for 30yrs or 20yrs Renting is cheaper depending what route you go and who you dealing with and i know it will go up in certain places And you dont control anything Which i think what everybody is buying a home for in first place But its alot less worry if you dont want to take on so much risk as a homeowner

[@sa34w]

Buy a medium house that meets your need and don’t splurge on house. Don’t treat it like an investment but a place to raise your kids and build a family. All children of buffet are divorced and his personal life isn’t something to write home about either.

[@Briank-ef5iq]

I baught my house in 2003 an Morgage just about done an house more then doubled in value ! That’s a bad thing ?

[@RobertDeMartin]

Warren (if I may!), excluding the people driven by how much money they can make, can you please address the people who will never have that kind of money and DO SOMETHING FOR THEM? What exactly do I mean? Perhaps set up learning centers outside of our school systems which will aid those less fortunate to become productive citizens. To build communities in all 50 States which are AFFORDABLE and which are managed in a way to insure they remain immaculate. I would like the world to remember Warren Buffett as a gentleman who dedicated the remaining years of his life to helping everyone have a chance to live their lives as happy and productive citizens. I'm assuming you are doing a lot of that right now in many ways and I hope I haven't insulted you in any way. What I'm suggesting is that you take it to the next level and the reaction would be, "Wow! What is Warren Buffett up to now?!?" If you include benefiting mankind around the Globe, that would be wonderful but, Warren, my goodness, we must preserve the United States of America as the bright light in the world, the beacon of hope for all, if humanity is to survive.

[@bobjones1620]

I'm 63 and retired with no children. My wife and I are considering selling our home and investing all the money and renting a property so that we don't have any worries about upkeep and selling the property when we are older. It would also free up all the cash from the house sale that we could use in retirement rather than dying with an expensive house as part of our estate. The investment return would more than pay for a nice rental home in the same neighborhood. Wonder what Warren Buffett would say. Any thoughts on this strategy?

[@rokyericksonroks]

Sounds like a good strategy. Lowers your overhead while freeing up cash flow.

[@okeuwechue9238]

You forgot to mention that when you're renting you have no control over the rental rate. The landlord will increase it anyhow he or she pleases every single year and you can end up paying way more than someone paying a fixed mortgage payment. Also you need to mention the fact that the appreciation of a home in a strong market period will far outstrip any of your expenses on the home. In such cases buying a home is a far superior option than renting.

[@Alejandracamacho357]

I’m super skeptical about investing/ contributing 400k to my portfolio after being in the red for so long. Honestly don’t know how to go about this.

[@lol4462]

I live in south Florida houses range from 350,000 and on up but rent is anywhere from 2500-4000 a month mainly for 3 bedroom 2 bath but a 2 bedroom is almost the same amount and most of the jobs here don’t pay much to afford your bills my rent is $3,000. A month it’s crazy

[@ReyanBenson]

I just started a lawncare company last year as a side hustle I’m at 46 customers so far. And I still have another job while doing this lawncare but all this couldn't have happened without an financial education and plans. All thanks to my advisor.

[@pellev2585]

Home price appreciation of 2% is not realistic. It's more like 3-5%. Taking 4% will lead to the same outcome. In a low interest rate environment buying a house is always the best option in my opinion. In the current environment it could be beneficial to wait for a recession and lower interest rates. But who knows when this will happen..

[@matthewphillips5483]

2% was realistic for most of recorded history until people started treating a home like a casino.

[@davideades160]

My first house I bought was a flat I lived downstairs rented the up stairs I own a single house that I live in an a six units rental.

[@justinnaidoo8827]

Well done!! Great work!! I came to same conclusion. Some nay feel otherwise because "owning " a house make oneS FEEL SAFE

[@cyofish]

Warren Buffet didn't say buying a home is a bad investment. It was more about timing as a down payment would have required he use all his capital to buy a house, rather than use it to invest in the market. He would have had to start over saving up the money which would have put him several years behind on his investment venture. A house is an asset that builds equity. and homeownership costs are incurred whether you are a homeowner or a renter. A renter pays for all the costs on behalf of the landlord, who reaps the benefits down the road while the renter ends up with nothing.

[@bobk3569]

Excellent analysis!

[@robertscheinost179]

Don't forget the piece of mind of being able to live your life the way you want, something that may be hard to do if you have a barking dog, like to do late night chores because of job hours (2nd shift) work on motor vehicles and need a workshop, things like that. I agree buying a house is a retrograde move financially. I saved for years and bought a house for cash in 1997. Since then I have been investing money and am planning on buying a better house when I am happy with the real estate market. One doesn't really own a house until it is paid in full. Still, home ownership opens up non-financial quality of life possibilities that renting will never offer. My take is (quote me) "expect a 40% drop in prices over the next 3 years". Remember, real estate home ownership is a liability, not an asset. A home is just a quality of life financial trade-off, nothing more, nothing less.

[@Jasongy827]

I don’t buy a car and house yet, honestly, doing a thirty year plan is a long time

[@matthewphillips5483]

A 30 year mortgage is downright depressing. To hell with that.