Why Many Millionaires Do NOT Buy Homes

[@LesterHess-t1x]

This is a synopsis of the rent vs. buy dilemma that I have spent years trying to resolve. I've never understood the rental revenue vs. mortgage payment equation. However, this is lot more sensible and rational. I appreciate you making this simple!

[@wmwoods-l4f]

Because they are used to bull markets, most people can't manage a decline, but you may make a good profit if you know where to look and how to navigate. Your entry and departure strategy will determine this.

[@j.ottinger]

Absolutely, having a solid plan is crucial. My portfolio has doubled since early last year. My financial advisor and I are working towards a seven-figure goal, though it might take until 2025

[@karitanaw]

@@j.ottinger I could really use the expertise of an advisor like that.

[@j.ottinger]

Her name is “Annette Marie Holt”. You can research her name to find the necessary details and set up an appointment.

[@karitanaw]

Thanks for sharing. I searched for her name and found her website. I reviewed her credentials and did my research before contacting her. Thanks again.

[@Mary-tj5qx]

I’m 58 and have never owned a home. I live in a super expensive area and my rent has always been lower than the taxes on my friend’s homes, so it was a no brainer. I will buy a very small, well situated condo in about a year, but purely because i plan to do a lot of travel and want a home base that i can lock and leave. I’ll pay cash because while my friends were paying mortagages and maintenance on their expensive homes, I invested surplus in the market. Far better investment over the same period of time. Home ownership is a lifestyle choice, it’s not a great investment in my opinion .

[@greggpurviance7252]

There is no way rent is cheaper than taxes on a comparable property. Unless it is rent controlled & even then it is not likely or long term

[@Mary-tj5qx]

@ I didn’t say comparable property, i said living in the same town,and in the same neighborhood. I’ve lived for 19 years in a beautiful 2 bedroom apartment in a very well maintained Victorian house, owned by an architect who uses the cottage behind the house as his office. Point being, he isn’t someone trying to be a landlord (i.e., it isn’t how he makes his money). It is also extremely tastefully maintained and he has an army of tradesmen who fix anything that breaks, basically immediately. My rent is significantly less than the property taxes on homes of my friends who live in small houses in the same town. And obviously taxes are only a small part of their outlay. they have mortgages, mortgage interest, maintenance. So they are in houses, I’m in an apartment. I have no interest in owning a home because of the associated taxes and maintenance cost and work, which is why when i do buy, I’ll buy a condo. I know a lot of people who do what i did. Home ownership is a lifestyle choice, it’s not a great investment when compared to the alternative. I’ve made far, far more in the market than i would have buying a home over the same period. Resulting in me having multiples more in wealth.

[@smitty923]

My $3500 a month rent, compared to a $1.2M apartment 2 blocks over, makes more financial sense. Plus no $1500 a month HOA and taxes. Both places are very similar. Surplus capital invested correctly far outpaces real estate returns.

[@rokyericksonroks]

@@Mary-tj5qx I agree with the points you are making. I’m doing something similar and would fully recommend it to anyone capable of seeing beyond the home ownership propaganda of the RE lobby. I only dumb foundedly stumbled into it but having even modest success in equity investing will make a believer out of anybody. My worries are about taxes on capital gains that I decided to take, not property taxes that some assesor decided I should pay.

[@ColetteSpencer-k5o]

Yep. Renting is about 1/2 of ownership in so cal.

[@jayholiday256]

I’m a multi millionaire and own a house free and clear. It lowers monthly expenses and is like a bond component of a portfolio. Don’t know why I watch videos about what millionaires do, whatever I do is what millionaires do

[@Rollochrome]

I dont know why I watch all this "guidance" either. Everyone I read on Bogleheads is one decimal point behind me and my neophyte planning and management has me WAAYY ahead of 99.99999% of the rich crowd so what am I doing with my time. Need to go to Bora Bora for Christmas and unplug.

[@brianmcg321]

lol. True. But a sample of one isn’t scientifically relevant.

[@jayholiday256]

@ being a multimillionaire only means having a net worth of $2 million or more, it’s no longer any big deal. I actually feel poor because most of my friends probably have closer to 5-10 million thru highly compensated employment or small business ownership.

[@karenjensen2345]

Same. There is no way we would ever rent. We own our house free and clear.

[@choco.es.unlimited]

​@karenjensen2345 you don't own your home. You're nothing more than a renter. Stop paying the taxes and the government will tell you who the real owner is

[@tonysilke]

Mortgage rates are currently at an all time high since 2000(24 years) and based on statistics on inflation, we might see that number skyrocket further, a 30-year fixed rate was only 5% this time last year, so do I just keep waiting for a housing crash before buying or redirect my focus to the equity market

[@Nernst96]

The stock market is no different, to maintain profit you need to have some in-depth knowledge on the market. I mostly just buy and hold stocks, but my portfolio has been mostly in the red for quite awhile now. Unfortunately to be able to make good gains, you’ll need to be consistent and restructure your portfolio frequently.

[@PatrickLloyd-]

In my opinion, it was much easier investing back in the 80s but it’s a lot trickier now, those making consistent profit in these times are professionals reason I’ve been using an advisor for the past 5 years to consistently build my portfolio in preparations for retirement.

[@PhilipDunk]

@@PatrickLloyd- My partner’s been considering going the same route, could you share more info please on the advisor that guides you

[@PatrickLloyd-]

I've stuck with SOPHIE LYNN CARRABUS before the pandemic, and her performance has been consistently impressive. She’s quite known in her field with over two decades of experience, simply look her up.

[@RobbieNixon-d1w]

Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.

[@JeffBrown9]

You forgot this….buying ties up too much capital that could be put to better use in other investments, than tied up in an illiquid asset.

[@serhiybakhshyyan10]

So, what is the reason you invest in all these better performing assets? Is it to create wealth for your kids and never use it yourself? First of all Family house is one of the most important STUFF in man's life. The reason why we invest is to be able to by desirable STUFF some years later (investment for the sake of investment makes no sense), otherwise we die very reach.

[@johnyang1420]

A house is a terrible investment

[@saulw6270]

A fha loan is only 3.5%

[@PeterParker-wj3cr]

@@serhiybakhshyyan10 Most buy homes to live in. Not as an investment. Putting all your money in a home that doesn't produce cash flow is the one aspect many over look with home ownership. Which leads me to believe home ownership is an emotional decision more than an investment decision.

[@4thand133]

​​@@serhiybakhshyyan10 why is a house the "most important stuff"? I grew up in NYC in an apartment, and had a great childhood with awesome memories. The idea that only owning a house makes you a good provider for your family, or can provide a stable environment for your kids, comes from decades of the marketing of "the American Dream"

[@jillbarrett2576]

If you are an average Joe make sure you retire owning a home. A rich person can buy one whenever they want.

[@razorsharplifestyle101hard9]

Damn! What about owning a motorhome is more affordble?

[@mikerenes]

​Doesn't hold value like a normal home will. Harder to get money out of it later as well.

[@razorsharplifestyle101hard9]

@@mikerenes What if you not buying it as a investment? A home is not a investment.

[@mikerenes]

That's just generally why. You can use it to pull money out of to purchase other properties without causing a tax event. You can live in it for a period of time, move out, and rent it out. It becomes an investment at that point but arguably it comes down to what your living cost options are. Real estate offers options. Mobile homes can be a good option depending on the person and situation. Depends what the bills would be otherwise. It is generally true that a mobile home will not appreciate let alone keep up or exceed inflation.

[@razorsharplifestyle101hard9]

Damn! folks being ripped off too.But i meant a motorhome not mobile home.

[@ewjomega2596]

I'm glad you said some millionaires don't own homes, because the vast majority do. They just don't buy at the top of the market, like so many people do.

[@leonhenry4861]

That’s not true either. If they like the house and it’s the home they intend to stay in for 20 plus years then they’re not buying at the top they’re buying what they want.

[@tigreytigrey8537]

Wrong.

[@goldstandardaviation1667]

A family home is a liability. A rental property is an asset. Multimillonaire here. I do not own a family home, only rental property.

[@serhiybakhshyyan10]

Do you have a family appart of dog and cat? If not, I agree you do not need FAMILY home.

[@johnyang1420]

People have pets in apartments too

[@lateralus6512]

I agree. A house is only an asset if it produces an income and increases in value, like a rental property. The family home is not an asset, it’s a liability.

[@Clarkssman]

having a house and privacy is priceless. Renting a house is so expensive vs paying a mortgage. Renting an apartment is less hassle and could be less money in the long run but hearing your neighbor pooping , couples fighting , or loud t.v's late at night isn't worth it.

[@BrokeAgain]

some apartment are quiet

[@enjoystraveling]

Well, even if you own a house, you can hear, couples fighting. I’m in a suburban neighborhood and then there’s lots of argument. People can live in a house and have loud parties at night, so I’m not sure that’s some valid argument. But I do think if you really want to have a house instead and really own it that is your choice and even if all the reasons think the opposite I myself would rather not have the yard to take care of, the worry of the roof to fix, the air, conditioner, etc., and be able to travel longer

[@isaachaze1]

This advice about not owning a home is always ridiculous. Having a PAID FOR house should be part of everyone's retirement plan. Rent never gets paid off, and almost always increases. So no, renting an apartment is definitely not less money in the long run.

[@johnyang1420]

Its not priceless….there is a price attached to it

[@Fredieprayla]

I live in an apartment, it's not perfect but nothing like those shit you had mentioned

[@stevenwistort9903]

Whatever floats your boat. I had it all, downsized and bought a moble home in the country. Very little maintenance. Everythings close, gym, track@field, trails, shopping, but more importantly peace and quiet.

[@earthexplorer1]

Niiiice!

[@MaseraSteve2]

ahh my favorite lifestyle

[@EriPages]

Sweet, brother. With the mobile home, do you drive around the country as well?

[@stevenwistort9903]

@EriPages yes, mostly on motorcycles. It's beautiful and peaceful.

[@EriPages]

@@stevenwistort9903 Nice, brother.

[@ccohen1965]

Owning a home is definitely more expensive than renting. The only reason to own versus rent is emotional (ie I feel better owning my own home - makes me happier). One nice middle ground is to own a smaller home that has lower maintenance/upkeep/property tax costs. Many people own homes that are too large and expensive to maintain. Every square footage you add to a home has to be maintained and updated over time. I currently live in a 3000 square foot home but often wonder why don't we downsize into an 1800 square foot home or even 1500 square feet.

[@miken7629]

Whether something is an asset or liability depends on which way the money goes. Asset: money is coming in... Liability: money is going out... A home is a liability for most because money is going out, interest expense, insurance, maintenance, taxes, "Cost of Ownership" will exceed cost of the home over time and outweigh gains in property value. A home could be an asset if it is a rental property and income exceeds expenses.

[@sciascia66]

I am 58 years old with a net worth of $2 million and 100% in equities. I own no real estate and do not plan to purchase. Be like Azul says and rent. My return on investment in the market these past seven years has been better than any real estate cook done.

[@RyanBerich-u1w]

You may want to consider diversifying. We may be heeding towards a period of significant market volatility.

[@irinab7524]

I own real estate and my return is over 30-35% if you consider the price I paid. Even in today’s value it’s 12-15% ROI. Stock market is going up and down like in 2022 but rents are going up as well as the price of real estate. My housing expenses, including utilities, is $600/month. If I’d pay rent or mortgage - it would be tripled. You don’t have to diversify with rentals but your primary residence is the gold mine: if you live there 2 years out of 5, your profit from sale will be tax free up to $250K/$500K if married. When you rent, all that growth goes to your landlord.

[@goldenparachute392]

I hope you’re taking into account property taxes, insurance and maintenance. Plus, the last two years the stock market is up about 45% and that’s without any of the expenses or hastle of owning real estate. Not to mention that you can sell all your stocks in minutes but you can’t dump your real estate very quickly.

[@josieramirez9483]

They are crazy! Owning your own is the best first thing you can do to prepare for bad times. Maybe it is not wise to do it in some countries but in south america it is very important to have a house.

[@DMAN590]

I'll give you a hint. It starts with a b and ends with an oomers. For example, I have a young family. I'm trying to buy a standard three-bedroom two-bath ranch. While I was there looking at the house, a boomer investor couple came in and started talking about all the plans they had for renovations to make it worthy to be a part of their rental portfolio. I'm just trying to put a roof over my daughter's head.

[@ChuckHolland-i4b]

Allowing 100 million imigrants into the country is what boomers are guilty of. The housing costs is just on byproduct of all their massive failures.

[@Theresonlyonetruth1]

I don’t think those are boomers.

[@DMAN590]

@Theresonlyonetruth1 and you would know how?

[@Theresonlyonetruth1]

@@DMAN590 how do you define “boomer”? Did you ask them for their ID’s? Don’t you think it’s possible maybe they weren’t “boomers”?

[@gwills9337]

@@Theresonlyonetruth1triggered lol

[@Qrayon]

I know a retired attorney who had famous people as clients. I asked him why he doesn't have a big mansion instead of the modest one bedroom apartment he's renting. His answer was, "I want to enjoy life."

[@VomBethel]

Although we own now, we plan to sell our house and then rent when we're fully retired in 7 years. For us in our area, we realize the house will most likely not appreciate significantly in our later years. Totally agree that we don't want the commitment. Also, it will be easier for our heirs when we're longer here if we rent. I've sold one inherited house and will most likely have to sell two more in the coming years. It's a lot of work to clean out a house getting it ready to put on the market. I don't want our heirs to have to do all of this.

[@soter305]

Very selfless of you. Light years beyond what most people would consider doing for their heirs.

[@Tchild2]

Great strategy.

[@Grace.h-t8o]

This is the summary of the rent vs buy decision I’ve been trying to figure out for years. The rental income vs mortgage payment calculation never made sense to me. But this is much more logical and makes far more sense. Thank you for simplifying this!

[@Lewistonwilliams-f5i]

Most people are unable to handle a fall since they are accustomed to bull markets, but if you know where to look and how to get around, you can profit handsomely. It depends on your entry and exit strategy.

[@Helen_white1]

Absolutely, having a solid plan is crucial. My portfolio has doubled since early last year. My financial advisor and I are working towards a seven-figure goal, though it might take until 2025

[@Theodorebarba]

I could really use the expertise of an advisor like that.

[@Helen_white1]

Her name is “Stacy Lynn Staples Stacy Lynn Staples”. You can research her name to find the necessary details and set up an appointment.

[@berniceburgos-]

Thanks for sharing. I searched for her name and found her website. I reviewed her credentials and did my research before contacting her. Thanks again.

[@briancarlisi2224]

If you live in a house and it doesn’t provide a revenue stream, then its NOT an investment, but rather a lifestyle choice.

[@LifeOfBryzzz]

"If" it appreciates more than it costs you then it most certainly is an investment.

[@briancarlisi2224]

@ I’ll clarify that a house lived in, while an investment per your definition, is not a good investment. Once taxes, insurance, interest on a mortgage, opportunity cost of tying up the money difference in the house over rent, and M&R are factored in MOST houses have just stayed pace with inflation. If a person avoided these expenses in lieu of rent and invested the difference in the market most would realize a larger return. In essence the point of Azul’s video.

[@enjoystraveling]

@@LifeOfBryzzz not really. even if your house is now worth more than you paid for it you have to subtract how much you paid to upgrade things inside the house, put on a new roof, pay for a new air conditioning, pay the property tax, the price for keeping the lawn looking good the fertilizer, etc. we’re paying someone to do that.

[@EBMB21]

It’s both for me. Bought a house in 1993 for $205k, raised my 3 sons there. 30 plus years later, that house is valued at $1.2M now. Got lucky! It’s both a home and a good investment in the end.

[@irinab7524]

@@EBMB21I’ve bought my house for $22K in 2013, invested another $35K and I live there mortgage free. If I’d rented it - it’s around $1600-1700/months now and I’m paying $300/months in property tax and $50/months insurance. Utilities are another $150-200/months but tenants pay all these, too. If I’d sell it today - it’s $180K and no capital gain taxes, too. It’s definitely an investment- I have to live somewhere anyway

[@jackbrownii]

Point 3 is a huge advantage for buying to me. I don't have to face moving again! Being "rooted down" is not a bad thing to me.

[@yawo7947]

Your reason is someone's reason for not wanting to own a home. They like the flexibility of being able to move whenever they want.

[@scottjackson163]

I’m about 88% of the way to multi-millionaire status and one the lessons I’ve learned is how useless net worth is as a measure of how well off a person is financially. You end up with a pot of money that you can’t spend without be taxed to kingdom come and another pot of money (equity) trapped in a house. You are just the dog that caught the car.

[@mr88cet]

I suppose it would take millionaire to think of a house primary as an investment, as opposed to a secure place to live first and foremost. I made a point to pay off our house as soon as possible, not only to free up $$$, but also to make sure we have a house to live in.

[@rvajna]

Onwnership provides security renting does not provide. What if the landlord gives you notice to vacate? They may sell the property to someone who wants to live there. Sometimes life is not just about money.

[@eunicebernard3054]

Well said

[@mikehuffman8208]

that's the biggest risk ... the owner does a 'rug pull' and you're out ... and tasked with pulling stakes to find another place to live. No thanks.

[@Himothy704]

What if eminent domain happens to your home?

[@lisat.8138]

The problem with renting is that unless you’re in a rent controlled building, your rent can go up every year much more than the cost of living.

[@WarGamersChannel]

When you buy a house, the mortgage is the minimum you pay. Taxes could go up or down depending on On-home value. On the other hand, maintenance is a burden that you will always have, and for some reason, many people ways forget to consider it. Buying a home could be a good investment if you buy at the right time. You make money when you buy, not when you sell. If you buy at ATH and the market goes downhill, you will be underwater for possibly many many years. Back in 2008, many house markets collapsed and it took over 10 years for homes to go back up in price. Imagine if you are forced to sell during this period, catastrophic. Always look at buying a house from the investor's perspective.

[@leonhenry4861]

@@WarGamersChannelmaintenance on a home is not that ,cub, stop blowing it out of proportion, you don’t buy a new boiler or get a new kitchen every year 😂😂😂😂

[@Stucatz911]

Wrong

[@ClemenceLisee]

Your video is outstanding! The way you break down complex financial concepts into actionable insights is impressive. I appreciate your unique presentation style, which combines humor, empathy, and expertise to create an engaging and enlightening experience.

[@IsaacHunt4]

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[@RyanBerich-u1w]

@@IsaacHunt4This sure sounds like a set up for a scammer financial advisor. Edit: I didn’t read far enough to see that this was the scammer recommendation. I thought that would follow. People don’t contact a “financial advisor” mentioned in a KZbin post.

[@Mackijs]

Property is very expensive now and comes with alot of commitment. It is a physical thing tied to a specific place and you have to maintain it.

[@MidlifeCrisisManagement]

not surprised, Azul. the expenses of home ownership have been spiraling upwards, especially insurance and property taxes.

[@Cakebattered]

Property taxes, insurance, and even maintenance, will never be as expensive as rent prices for a comparable property.

[@RyanBerich-u1w]

I strongly disagreed with the premise of this video from the beginning until the map that showed I am in one of exception cities. Actually, a suburb with a lower cost of living. My mortgage will be paid off in 2 years and after that living rent free, even with taxes, insurance and other home ownership costs will be a small fraction of rent.

[@23pinkpear]

3 years ago i had little to no hope to buy a home in Arizona so instead i began investing I am now getting dividends to pay my bills and i have no intention of buying I will continue to invest instead

[@Play-ball4u]

Same plan here

[@moukafaslouka4796]

Buying makes way more sense than renting! No matter what "experts" want you to think! It costs to own a house. That's a given. However, you can always cash out when you sell it. It more than makes up for any opportunity losses!

[@AntoineFL]

Remember guys, you are not a millionaire. Buy a home if you can!

[@georgejetson4378]

1:37 Just to clarify, “…the median sale price for a single-family home in the US was 5.6 times higher than the median ANNUAL household income…”

[@KH-vw9yl]

I wonder what the percentage of Millionaires own vs do not home. I personally think real estate ownership is better for us financially, emotionally, and for our health, not to mention our over all quality of life. Renters as a whole seem to have less invested in their community, vs. homeowners that care about the neighborhoods the live in and do so for the long term. Short term mindset vs long term investment in the community. There is also long term stability for the family dynamic even for someone worth 7-8 figures. Why a few might rent due to being financially independent It maybe likely that far more own, and will own generational. I appreciate you Azul giving us all the advice and no cost and working hard for us.

[@nishali3343]

owning a home forces you to save money aka mortgage payment. you can rent for cheaper but if you don't invest the difference, you are screwed. Lanlords can't force you out of a house (like selling a property, personal use, renoviction etc... ) you always have a roof above your head.

[@michaelking4578]

I'm not a millionaire and happy I bought a home 17 years ago when rates were low and property cost 1/2 what it does now. My house is now much less expensive than renting a smaller less desirable home or even a townhouse/condo. It's nice to build equity and not have to worry about the rent going up. With that said I see the luxury of renting but I cannot afford to do that now.

[@RyanBerich-u1w]

Without doing the research, I suspect there will be a long term equilibrium between the cost of real estate ownership and rent. If it is cheaper to rent, many landlords will sell, reducing inventory, and therefore, increasing rent and reducing property values. The imbalance will likely result in exposure to risk that I would not be comfortable facing in retirement, especially late in retirement. I agree that buying in an overpriced market is not a wise financial decision but taking on the risk of future rent increases or being forced to find a new home on a timetable dictated by a landlord is also not a wise decision for many retirees. I understand why a typical millionaire might rent versus own when they are willing to take the risk. I said in 2007, if I were single, I would have sold my home and made other arrangements for a few years. At that time, I said a housing bubble is where the average buyer cannot afford the average home. I think the same is true today. With the family in 2007 and as a retiree in 2025, it is not worth the risk to give up the security of homeownership.

[@dkstudioart]

I'm a millionaire and I don't own a house. Makes no financial sense for me to buy a house, especially at my age. I rent a modest duplex, my rent is cheaper than the average mortgage, never mind all the other costs that come with owning a house. I also don't want to take care of a yard. Also, most of my wealth is in an IRA, if I paid cash for a house the taxes and penalties from the IRA distribution would kill my balance and I'd just end up cash poor with little income off my IRA.

[@masonrwalt]

But you are not typical in your thinking, which is partly why you are a millionaire. You're happy with a modest duplex. If gardening and lawn care was a passion, I'm sure you would be happy in a modest home too.

[@WetPets-gl2ts]

I guess a barely millionaire would not want to own a house. To be consider wealthy, you will need close to 4 million and to qualify in the 1%, you will need close to 20 million. At that level, the issue becomes a moot point. That's why billionaires own so many properties across the world. This type of question is only for those aspiring millionaires.

[@tubenachos]

I personally like my private space without sharing walls

[@tramelparker2085]

Touché

[@4thand133]

Many renters rent free standing single family homes. You don't have to share walls because you rent

[@ludovic4903]

Azul, Even if it costs more to buy wouldn't that be better because over time you are creating equity vs wasted on rent?

[@leonhenry4861]

Exactly, I think people are missing the point. Millionaires can afford to rent because they Probably hold real estate in a different portfolio. Regular people should buy because it’s a great way to build wealth.

[@Cakebattered]

I'd love to see some data regarding millionaires (Excluding the House Rich) and what percentage of them own residential property. My guess its in the 90% range. Don't listen to what people say, watch what they do. Homes may not be great investments, but they have historically been proven to be amazing hedges against rent prices. Nowhere in the US can you rent for less than buying when you uses comparable properties, vs just comparing median rent prices vs median home prices. The median priced rental does not offer the same space or utility of the median priced home. Apples to Oranges.

[@WilliamMartinez-vq2bn]

Im not a millionair but my home is paid for i rebuilt it myself and live like a king,,and love it bigtime!!!!,i do 90 percent of repairs,,,very low over head and with anchor tax break even better

[@Bonner901]

Crime in Memphis, TN is out of control that's why it is so cheap there. Leaving Memphis was the best thing I could have done.

[@niciassmith1204]

That 5.6x median income is a total fantasy. I live in a flyover state and the worst garbage house you can buy in my area is probably 7x and do you want to live in something that's trash? The reality is that even in non major cities, coastal areas its really more like 8x median income and in exoense places it's 12x to 20x I did a lot of research on this and until 1980 even apartments in Manhattan were in the hundreds of dollars a month. Even in many expensive areas it was 4.5x median income and keep kn mind prior to the mid 1990s many households were single income so now most are duel. And if it's just you, you can't compete with duel income unless you are an elite top 5% income earners

[@lucrtrvl]

Rents go up every year. Monthly mortgage payments stay the same.

[@Mjs-jb5rw]

Inflation will cause rents to rise over time. Eventually you’ll have a set mortgage where rents will surpass that mortgage. I like to think at the least when you buy a home you’re buying a set monthly mortgage.

[@taWay21]

One word. Liquidity.

[@escalade8759]

I will start by saying we have been buying homes since 1994 to include investment properties in which we do not own any at this time. We bought our current home in 2022 in a fast-growing community. I will say this, "if you are going to buy, try buying in the area of growth." While I think owning a house has been a joy for me and my family, owning a home is certainly a cash cow. We made money in certain circumstances, but we lost money in others. We are now in our early and mid-sixties and have begun considering ending the buying of personal properties. We are considering investing in real estate once again. I personally don't believe the current generations and beyond will be able to afford buying a home. It's obvious others in higher positions believe the same as they are building apartment buildings hand over fist. Buying a home is personal. To each its own! Just have some money and don't buy at the top of your affordability. Lastly, pay off all other debts which will ease the blow of homeownership.

[@snaroff007]

Interesting perspective, but I don't believe Azul ever quantifies "Many". My gut says the data doesn't support this. Most millionaires by homes. Homes are a lot more useful than stocks:-) I've owned 7 homes in my lifetime (6 new builds) across several states. Most of them were very profitable. All were useful. The primary outlier was a home purchased just after the 2008 mortgage crisis. Bottom line: If you plan on living somewhere for 5-10 years and you live in a highly desirable area, it's pretty easy to make a considerable amount of money. It's a great way to diversify a portfolio. Having all assets in the stock market isn't smart.

[@Go-Getter]

There's no good reason to not buy a home. Especially when you can velocity bank your mortgage and have it paid off within 5-7 years and never have to worry about a house payment again in your life.

[@jcd3869]

Good vid thx. If lifestyle choice is more about pure investment it may make sense to rent- 1. Value----From 3 to 6 income to home buying cost ratio since mid 2000's. Can it go higher? Unlikely. 2. Rent is cheaper(Boston etc.) in many cities 3. Maintenance commitments, lock in vs. free to roam

[@ajaynair2636]

If you are young and keep jumping jobs it doesn't make se sense to buy. Better invest in 40qk, index funds, stocks as much as you can. Once you decide to settle only then buy a house (small one first). All my life lessons.

[@Notmanypeople]

Great advice and video. Just a tip for the recommended videos at the end give it a few more seconds because I struggled to find out why retirement at 65 is a big mistake 😅❤

[@solidmercury1]

I already bought a home, 😢 It’s overwhelming, I agree ☝️ .

[@csick11]

Its all preferences. The reason why I dont own a home is because I became financially stable as i gotten older. I enjoy investing.

[@jennifernelson9664]

I live in the SF Bay Area, and I wish I could buy a home, but it’s a pipe dream here. I would love to retire somewhere that I could buy and not worry about being forced to move due to landlord issues. Hard to do especially as one is in advanced age.

[@iamalanabroad]

Hey i'm Herebebarr's brother! Just wanted to drop a line that I enjoy your content. Keep it up.

[@Greenapul]

Owning a home in a nice neighbourhood with many services, fabulous neighbours and no crime is a luxury. Others may choose to spend their millions on Rolex and fancy cars but that doesn’t compare to the lifestyle bump of owning a fabulous home.

[@WealthyChronicle]

Millionaires aren't buying homes because it's cheaper to rent? But doesn't owning provide long-term security?

[@thedevongroup]

A lot of misinformation here. The average real estate agent according to the national Association of realtors only makes $50,000. And the federal government pushed home ownership by rolling out the FHA loan in the 50s after World War II. I’m a realtor and I tell people to buy a house because it serves as a place to live in a nest egg for when you retire even if you set no money aside at all at least you’ll have a ton of equity.

[@527ctguy]

HI Azul, I too could buy a home but don't feel that it is a good investment right now. We live in California and got a great apartment with rent control. For me, I like my apartment. I watch your videos. Got a pension, planning to retire at 60.

[@robertswain370]

Anyone who thinks there own house is an investment doesn't know what an investment is an investment must do two things put money in your pocket and increase in value your own house only does one of those

[@KBWFreedomthrurealestate]

Great video/post!

[@chrissharkey9644]

I would! Even if I wasn’t a millionaire provided it was market price or less

[@termita358]

Realtors commissions are insane. I don't know any other country where realtors make that kind of money. A real mafia 🤦‍♂️

[@isiah675]

All the wealth surveys I've seen over the years say the opposite. The primary is just such a smaller portion of the overall portfolio as they age 🤔

[@kfbob364]

I am a multi millionaire, and i own 4 houses. I rent out 3 of them and live in the other one. I can fix anything that goes wrong with the houses. I get really good deals on repairs because of my connections. I am a developer/contractor. I live in an area that it is much cheaper to own than to rent because of massive real estate appreciation.

[@刘剑-e7j]

I am multi millionaire, I rent a bedroom in Boston, my rent is 750 a month including utilities. My land lord who owns the house live in basement

[@ColetteSpencer-k5o]

Are you happy doing this? I would think you would want to buy a place so you can have friends and family over.

[@scoaste]

I'd love to see similar price::income ratios for European countries.

[@nikanderson3543]

Two things people rarely talk about in favor of owning a home…1) if you rent you are at the mercy of the landlord if they decide they want to sell the house, etc., nobody wants to be told they have to move, especially when you can afford the exact type of life you want 2) if you want to live in a luxury 3000+ sq ft home, with high quality fixtures, it is nearly impossible to find a house like that available to rent, owners Of these homes aren’t typically messing with trying to rent them out, in part due to cost effectiveness of maintenance on high cost appliances, cabinetry, flooring, etc. I often Zillow this dichotomy in different cities and it always holds true.

[@greggpurviance7252]

Housing is not an investment. It is a place to live. Interesting housing issues & immigration flood are connected. NY is rent controlled. Retired with an owned home. Glad. Best for us but others can do them

[@mmfogar]

These people are lying. Millionaires own houses because houses are the bases for your wealth. If they don’t personally own the house they’ve inherited a house. Or, the house is held by a trust. But I guarantee you somewhere in their portfolio. They own a single family house or condo or townhome. They own property That they live in or someone in their family lives in.

[@JBoy340a]

I know quite a few people that have a lot of money and pretty much all of them have a private primary home. They prefer the privacy and security of not sharing. But, depending on their upbringing and other biases they may or may not pay cash or pay off their mortgage early. Instead, they choose to pay a mortgage and invest their money elsewhere. Marc Zuckerberg is an example of this latter group.

[@escalade8759]

Great article!👍

[@jimc4839]

Thought about renting many times due to the money pit factor of owning. My grown and gone kids keep talking me out of it.

[@23pinkpear]

excellent video by the way Mr Azul

[@STEVEN-vz8qq]

How much will Rent be in 20 years?? 20 years ago I paid $500 a Month for rent One bedroom Apartments are going for $1500-$2000 a Month here in Houston To each his own

[@djWARRIOR]

So are you suggesting by investment properties like duplex four Plex apartment buildings commercial properties ?

[@genestone4951]

I only buy real estate for other people to use so I can hold a lease and receive a stream of income...it's not magic.

[@ryangeorge3982]

Waaaaaay more millionaires own a home than ones that don’t. Majority of millionaires are millionaires because of the equity in their homes

[@Leo_Vasileio]

Dont forget forever paying property taxes or HOA even if you own the home. The only place worth buying a house or a condo is abroad. That to me is worth the investment. If you're not there, you can rent it out on airbnb.

[@milkncookie]

I have a home that's fully paid off. But I also live half the time internationally where I rent a condo.

[@willd4731]

A house that was purchased for $400,000 in 2019 is now worth about $800,000 where I live. New jersey. That's not a good investment?

[@DMAN590]

You do understand there are extenuating circumstances that cause that namely the money printing from the pandemic, right?

[@HEALTHANDWEALTHCHANNEL-h6o]

......because they're never home?

[@howtoactuallyinvest]

At best I'd double my home value over a couple decades. Meanwhile my portfolio more than 10x'd in 5 years. I've got 20 years of investment experience though so I don't represent the norm by any means. I also value my time more than anything including more money, so being able to make a maintenance request is ideal. Property tax means you'll never actually own your home and I know ppl who could pay my rent w their property tax money alone

[@YoQ-PHL]

Price of houses aren’t going up, the value of the dollar is going down. Once you look at it that way, it changes your approach to saving and investment.

[@Tchild2]

Renting vs owning is a personal choice. There are probably a lot of good use cases where renting has worked better for many. If you are a millionaire and renting, then you are probably financially savvy and have your reasons.

[@habarizenuTV]

Home ownership is much better outside the States...50-60% less in most cases and noooo property tax- If you do rent its about 50-60% less as well-

[@Jennifer-xq2yu]

I had problem comprehending trading in general. I tried watching other KZbin trading channels, but they made the concepts more complicated. I was almost giving up until when i discovered content and explain everything in detail. The videos are easy to Follow

[@AdamJones381]

There are pros and cons to buying and renting. It depends on your circumstances.

[@sleepmoneyken9234]

I hold on to my wealth because of the passive income it generates and because of my equity . If I sold my rentals and bought a home, I would have to rely soley on my business income and that's not smart because it fluctuates . I can lose a damn contract if I accidentally fart in front of the clients .😂😂

[@In_con_ceivable]

Just way too many variables to have a 1 size fits all…just rent or just own, who knows, it’s different for everyone. 1 thing I’d consider very important is; if there’s a place you like to live and you have good money, then buy a place.

[@mikehuffman8208]

Need to legislate private equity and speculation out of the housing market. It's painfully obvious that things are completely out of balance.

[@boondoggle4820]

I bought a house in 2022. I don’t want the value of my home to double over the next ten years. I want the value of my house to go up 1-2% per year. It doesn’t benefit the owner for prices to go up until you’re ready to sell. It just means higher costs for insurance, maintenance and taxes.

[@tonyvaninetti3429]

I do not think that most of us who watch You Tube care about why millionares do anything. What we do care about is fair rents, reasonablely priced homes, both new and used and less greed in the whole process. The new tax laws of the late 90's radically changed the capital gains game on homes and then everyone that could afford to got into the flip and get bigger home game played. I blame some of this insanity on the federal government. But keep in mind all the property taxes localities gained by such price increase. The building process with all the codes and the fees and inspections and additional requirements make home building a big ticket item and a horrible process. This and zoning rules are some of the reasons there are not enough reasonalble priced homes and rentals in our cities and suburban areas. It cost too much mney to buy, to rent and expecially to build. It is a national scandal.

[@joaor.8780]

Buy a home if you know for SURE you are going to make money on that deal down the road. Period. Its a no brainer.

[@jonathanrabbitt]

What asset class isn't overvalued at this point?

[@einat1622]

Reasons 2+3 are valid. Reason 1 isn't, and isn't true in the case of many millionaires. If you own a house or an apartment (no debt on it) you will never be on the street, and much likely your kids (if you have a small amount of) won't be either (unless they do something stupid).

[@enjoystraveling]

Not always true, if you don’t pay the property tax for examples they can foreclose on your house or maybe that’s the mortgage payment and the bank can take your house. Also, if you don’t pay your medical bills, they can take your house I believe

[@einat1622]

@enjoystraveling I specified "no debt on it", plus this video is on topic regarding millionaires.

[@einat1622]

@@enjoystraveling Did you add the medical bills as a later edit? I don't know which country you're from, but in many western countries those are not releated.

[@Uaintfirsturlast]

You confirmed what I suspected about real estate. While it’s not a bad investment it’s just not as good of an investment as it was yrs ago. Plus after you factor in the cost of maintaining a house along with all the unanticipated bills like repairs and taxes adds up and dilutes your effective ROI. You can get a better long term return with lower risk in the stock market by simply investing using DCA in an SP500 index fund and hold some Bitcoin. My net worth has more than doubled since I sold my last house and I’m no longer house poor which means I have more disposable income to do fun things. Less stuff more life!

[@Theresonlyonetruth1]

I think it was the boomer generation and feminism. This country managed to convince women that being empowered and making their own money was more important than creating, raising and staying with their families. So you had both the mother and the father out in the workforce, meaning there was more disposable income. Meaning the costs of houses went up. Now, as a result of feminism more and more young men increasingly are refusing to get married because they don’t want to go home just to compete with their own wives that seem to have something to prove. So now you have all these over-priced houses and only a single income. Also exasperating the problem now there’s a contrived effort to make young women more successful through gender-focused programs. And as a result men are under-performing while women are complaining about men not measuring up. Further driving the decide between men and women and in turn taking us further away from being able to afford over-priced homes.

[@kevinanderson967]

Nailed it 👏as a 62 year old I’ve lived thru this change and now it ends down here in the Villages,Florida where it kinda reek like the good ole days🎶

[@FreePianoLessons]

Thank you, this was super helpful =]