Speaker 1: Welcome to How the Money. I'm Joel and I'm Matt.
Speaker 1: Today we're talking about renting versus buying a home. So
Speaker 1: today on the show, we're gonna challenge the assumptions that
Speaker 1: buying a home is a good quote unquote investment. We're
Speaker 1: going to talk about things that you need to consider
Speaker 1: before buying a home, the pros of renting, the pros
Speaker 1: of buying, and give our final thoughts on what's better
Speaker 1: renting or buying. Yeah, Joel, I think this will be
Speaker 1: a good conversation first of all, because I have good,
Speaker 1: like fond memories of renting, so just like the emotions
Speaker 1: that I have towards it are negative. Yeah, I don't
Speaker 1: have the most fond memories of renting. I think it
Speaker 1: was kind of fun when you're younger, living with you know,
Speaker 1: like three dudes in a two bedroom of oar bet
Speaker 1: or something like that. Yeah, not my favorite times. How
Speaker 1: much for owning a home right now, and just kind
Speaker 1: of the stage of life. I'man I think it's way
Speaker 1: more fun to be in your thirties than it is
Speaker 1: to be in your twenties in a lot of ways.
Speaker 1: That being said, I think there are so many good
Speaker 1: reasons to be a renter, and we'll get into those
Speaker 1: in just a minute. I wanted to let you know,
Speaker 1: speaking of running, we have rental homes and last night
Speaker 1: I had a fridge crap out at one of my
Speaker 1: rental homes and so I had to replace it. So
Speaker 1: we're trying to get me to it. I know. I
Speaker 1: was sparking up the tree to see if you wanted
Speaker 1: to help. Got another friend, Colin, to help me move
Speaker 1: a fridge. But he's got muscles too, so that's good. Yeah,
Speaker 1: he's stronger than you are, so that's that's why I
Speaker 1: reached out to him. I got the best deal I
Speaker 1: looked on Craigslist, which is we talked about, you know,
Speaker 1: where to buy certain things. It's great for appliances. Craigslist
Speaker 1: is an awesome place to buy appliances. Uh you know,
Speaker 1: it's much harder to find stuff on Facebook or whatever,
Speaker 1: but Craigslist is an awesome place for that. I don't
Speaker 1: want to buy your fridge on eBay, have a ship
Speaker 1: to you. The shipping would have cost more than the
Speaker 1: fridge because I paid seventy five dollars that is for
Speaker 1: a six year old fridge. YEP, So I think this
Speaker 1: thing will be nice. I loaded it in the back
Speaker 1: of the mans to five strap strip it down, I
Speaker 1: mean not all the way, but well enough. Yeah, and
Speaker 1: I bought it from another dude named Joel. Oh really
Speaker 1: around there. So I met a new neighbor. I got
Speaker 1: a seventy five dollar fridge in the neighborhood close by
Speaker 1: r Yeah. So he was literally like three or four
Speaker 1: blocks away from me. Oh no way. Yeah, that's awesome.
Speaker 1: So it's kind of fun to meet a new neighbor,
Speaker 1: get a seventy five dollar fridge, hung out with Colin,
Speaker 1: you know. Yeah, so it was good times. I live
Speaker 1: being thrifty man, Yeah I did. I did too. That
Speaker 1: being said, the last fridge that I bought, I didn't
Speaker 1: have time to to scour Craigslist, and so I just
Speaker 1: went to Low's, our local hardware store, and just kind
Speaker 1: of got a cheaper model there. It was I think
Speaker 1: it's everybody's local hardware store. Yeah. Uh, but this is
Speaker 1: before we had a larger vehicle, and when all we
Speaker 1: had was our Vida Volkswagen. But we had the bars
Speaker 1: on top, like uh, what is it totally rack? You know,
Speaker 1: like the bars that go across the top make you
Speaker 1: look like you're like an outdoorsman, but in our case,
Speaker 1: that's where I put my fridge, so literally yourself. Yeah,
Speaker 1: the the guy, the guy at low it's helping me
Speaker 1: to get it up there, but he's just like, wait,
Speaker 1: we're putting this whear because it wouldn't fit inside the
Speaker 1: back of the wagon. And yeah, man, through a fridge
Speaker 1: up on top of our volks wagon, strapped it down
Speaker 1: and drove it back to the to Uh. It was
Speaker 1: actually the house that we're moving out of that we
Speaker 1: were converting into a rental because the fridge that was
Speaker 1: there was in poor, poor shape. So and by the way,
Speaker 1: if you want to know why that's the best method
Speaker 1: of starting owning rental homes, moving out of it and
Speaker 1: running that out, go back and listen to our Investment
Speaker 1: Property Basics episode and you'll find out why. Oh and man,
Speaker 1: I wanted to tell you one more thing, Emily and
Speaker 1: I did the budget right before biking over here tonight
Speaker 1: to do this episode. What do you mean when you
Speaker 1: say when you say you did you did the budget?
Speaker 1: Are you recapping the month essentially? And how did things go? Yeah?
Speaker 1: Where did we overspend? Underspand how can we do better?
Speaker 1: Where did the actual inside of those specific categories where
Speaker 1: did the money go? And that helps us know better,
Speaker 1: you know, was it a one time thing? I guess.
Speaker 1: I was just check. I was wondering if you were
Speaker 1: setting a new budget for this coming month, because for us,
Speaker 1: it's basically the same budget from last month, like we
Speaker 1: al really changed things. No, we're just checking in. Yeah,
Speaker 1: where we're at the recap. But I want to say,
Speaker 1: it looks like I'm retiring after this episode because I'm
Speaker 1: that filthy rich. Congratulations, yes, thank you, and so podcast listeners,
Speaker 1: I'm sorry we won't be back next week. No, I guest, digest,
Speaker 1: I stick around. Let's stick around. Please, even if you
Speaker 1: were retiring, this is I mean, let's be honest, this
Speaker 1: is what you'd want to be doing. So this is
Speaker 1: having a good time because we get to drink beer.
Speaker 1: Because we get to drink beer. Yeah, and so today's beer, Matt,
Speaker 1: you picked this up for us. It's from a local
Speaker 1: brewery that we're huge fans of, huge fans of Wrecking
Speaker 1: Bar Brewpub. Honestly, Matt, if I had to say a
Speaker 1: gun to my head, what's the best brewery in Georgia
Speaker 1: right now? Wrecking Bar Brewpub? I think so. I think so, man,
Speaker 1: I was, Yeah, that's they're I mean, they're rushing it
Speaker 1: right now them, I'll be honest with you, and we
Speaker 1: might have one of these beers pretty seen to you.
Speaker 1: But Monday Night, yeah, they have been stepping up their
Speaker 1: game and making some incredible stuff too. Those are literally
Speaker 1: that the two places I would tell someone if they're
Speaker 1: coming into Atlanta and they wanted to find out where
Speaker 1: to get good beers, Wrecking Bar and Monday Night, go
Speaker 1: to those two places and you will have awesome beers
Speaker 1: and awesome experience. Yeah, Wrecking Bar has it's a restaurant
Speaker 1: as well, and they've got a farm, uh not that
Speaker 1: far from Atlanta and do Their food is so good too.
Speaker 1: That's why Kate and I both love going there. We
Speaker 1: can get just amazing food and at the same time
Speaker 1: they're making some awesome, awesome beers. They're doing such a
Speaker 1: good job with all the beers too. It's not like
Speaker 1: they're only specializing in amazing I pa is like, we're
Speaker 1: gonna have tonight. That Russian Imperial style that they have
Speaker 1: that they put out every month. It's like the Mexican version.
Speaker 1: So it's got the peppers in it. I guess that's
Speaker 1: mind blowing. And then they've got all these different farm arritles,
Speaker 1: their different stays ons and and obviously all a lot
Speaker 1: of their I pas are fantastic too. So yeah, that
Speaker 1: stout I think is probably I think that's like one
Speaker 1: of the best deprobably the best out in Georgia. It's
Speaker 1: one of the best outs I've ever had. Yeah, and
Speaker 1: it's phenomenal every single yeah. So yeah, So if you're
Speaker 1: coming to Atlanta, and we need to write a post
Speaker 1: on this at some point on the site, just introducing
Speaker 1: people to our town and where do you like, like
Speaker 1: a local Georgia or a beer guide? Yep, alright, righte
Speaker 1: it up, Joe done? Can you do that? All right?
Speaker 1: So let's crack this one cause I'm thirsty. Nice it's
Speaker 1: got that deeper crack. These are sixty ounce cans for
Speaker 1: the trained listener out there. You may have picked up
Speaker 1: on that, but not as deep as the crowler that
Speaker 1: we had. That that's like opening up. It's like a
Speaker 1: shotgun drum of oil. So we didn't even introduce this style.
Speaker 1: But this is the Juice Bar Pale Ale Yeah, and
Speaker 1: the and Wrecking Bar has this essentially this juice series
Speaker 1: where pretty much every time you go the B series
Speaker 1: Juice Bar series, and they essentially every time you go
Speaker 1: they have a pale ale or an I p A
Speaker 1: or double I p A on tap that's part of
Speaker 1: this series. And really they're just incredibly juicy, delicious beers.
Speaker 1: And so this one wasn't cheap, but I mean their
Speaker 1: beers are good. This this one was worth it. I think, Matt,
Speaker 1: you paid fifteen bucks for a four pack, right, yeah,
Speaker 1: fifteen for a four pack. And honestly, though, to be
Speaker 1: able to pick up a beer that's that fresh, canned
Speaker 1: days before we picked it up, it is hard to beat.
Speaker 1: So Jill, that poured a nice golden It's not perfectly filtered.
Speaker 1: It's not meant to be super cloudy, I don't think,
Speaker 1: And I know I was supposed to sniff it first,
Speaker 1: but I kind of went straight in for the sip.
Speaker 1: I was just that thirsty. And this is delicious. At
Speaker 1: five and a half percent, it's um and being a
Speaker 1: pale ale, it's a little light, but man, it's like
Speaker 1: all hops. Like there's no malt backbone almost it is
Speaker 1: all hops, and I'm all about that. Yeah, they've got
Speaker 1: to set up to be a session nail. And for
Speaker 1: those who may have heard that term before, but maybe
Speaker 1: I don't know, you don't know exactly what that means.
Speaker 1: It's just a lighter beer um that you can maybe
Speaker 1: have more than one in a sitting, which we're not
Speaker 1: going to do tonight. But yeah, that's the idea behind it.
Speaker 1: And I'm getting more and more into these lower A
Speaker 1: BV beers so that I can have a couple in
Speaker 1: an in an evening for once in a while. And
Speaker 1: it's Yeah, it's really nice because usually if you want
Speaker 1: to have three beers in a night, you're drinking Budweiser
Speaker 1: if you don't want to be hung over the next day.
Speaker 1: But there's so many good beers weighing in it, you know,
Speaker 1: five four and five percent now that are full of flavor,
Speaker 1: so you can actually have a couple. Yeah, and this
Speaker 1: is full of flavor, man, like you said, just hop forward.
Speaker 1: There aren't a ton of beers that I've had that
Speaker 1: have this much like hot presence but without sort of
Speaker 1: that thicker body. It's different. I guess I'm just not
Speaker 1: used to that, but I yeah, I like it. This
Speaker 1: juice bar pale Ale from Wrecking Bar is delicious. It's
Speaker 1: like a cumulus cloud on my tongue. I'll take it. Yeah,
Speaker 1: So this is a beer that I mean, they can
Speaker 1: they're on site, but they don't distribute or anything like that.
Speaker 1: So this is an example of one of those local
Speaker 1: breweries that are kind of filling the void of local
Speaker 1: beer for folks to kind of come by and get.
Speaker 1: And even when they do release it's a very small amount,
Speaker 1: there's usually a line that's built up. They'll announce it
Speaker 1: day of over the day before. Hey, we're releasing it
Speaker 1: eight pm tomorrow and I it or noon on a Friday,
Speaker 1: and it's sold out within an hour. So if you're
Speaker 1: passing through town and it's great to get a beer
Speaker 1: on draft there, but you're probably not going to get
Speaker 1: any cans to go at least at this point. Yeah,
Speaker 1: but hopefully there's a local brewery that is doing something
Speaker 1: similar to this near wherever it is that you are.
Speaker 1: I mean, like we said last in the last episode,
Speaker 1: that's one of the things we're excited about with the
Speaker 1: industry as a whole, is just sort of that move
Speaker 1: back to to more the local local brewery that you
Speaker 1: that you go and hit up. Yeah, your neighborhood spot.
Speaker 1: All right, Matt onto the topic at hand, renting versus
Speaker 1: buying a home, and this is one of those topics
Speaker 1: that has captured the minds of personal finance experts everywhere.
Speaker 1: And I think there's something we can add to the debate,
Speaker 1: and I think there's some really important things that we
Speaker 1: need to clarify for people on both sides of the
Speaker 1: aisle when it comes to this topic. And I think
Speaker 1: the first thing that we really need to talk about
Speaker 1: we need to challenge the assumption that buying a home
Speaker 1: is a quote unquote good investment. That's kind of been
Speaker 1: the long standing traditional thought that buying home, well, yeah,
Speaker 1: of course you got to do it. It's an American
Speaker 1: dream and it's a good investment. But I think there
Speaker 1: there is a large element where people have run with
Speaker 1: that thought and made really poor choices when it comes
Speaker 1: to buying a home instead of running edual. I mean,
Speaker 1: that's my goal right for this specific episode, is that
Speaker 1: by the end of the conversation that we've caused you
Speaker 1: guys to think about this sum and that it isn't
Speaker 1: just sort of like this assumption that it's not an
Speaker 1: assumption that your home value is only going to continue
Speaker 1: to increase, you know, like we were just talking about
Speaker 1: back in uh two thousand seven, Like people, we know
Speaker 1: that that bought back then, and that was the assumption,
Speaker 1: and that didn't really pan out too well for a
Speaker 1: lot of folks. And if you're buying for the wrong
Speaker 1: reasons in two thousand seven, oh yeah, then there's a
Speaker 1: good chance that that that purchase led to heartache. But
Speaker 1: if you made a purchase for the right reasons, you
Speaker 1: likely could have weathered that storm even though your home
Speaker 1: dropped in value, you know, unless you suffered something terrible
Speaker 1: like a job loss and a bad economy or something,
Speaker 1: or you know, or some other major devastation happened in
Speaker 1: your life. If you're buying at home under the right pretenses,
Speaker 1: like we'll discuss here, I think you probably still could
Speaker 1: have weathered that storm of your home just being worthless essentially.
Speaker 1: And what you mean by like buying for the right reasons,
Speaker 1: is you mean buying for reasons other than just purely financial, right, yeah,
Speaker 1: And I mean I think a lot of people at
Speaker 1: specifically at that point in time, with the way the
Speaker 1: real estate was appreciating, they assumed they could buy something
Speaker 1: one month and sell it the next for a much
Speaker 1: larger gain, and that is just not and that that's
Speaker 1: just not typical when it comes to real estate throughout
Speaker 1: the history of real estate. Essentially, it appreciates roughly at
Speaker 1: the rate of inflation. So buying a home with the
Speaker 1: thought that it's going to appreciate rapidly that's just not
Speaker 1: normally the case. And so if you buy a home
Speaker 1: with that rationalization behind it, and you're using very little
Speaker 1: money down, then that, to me would be an example
Speaker 1: of someone that's not being thoughtful about the purchase of
Speaker 1: that home. Yeah. Man, honestly, that's just that's what freaks
Speaker 1: me out right now. Like seeing the way that the
Speaker 1: markets continuing to I mean, it's been climate for the
Speaker 1: past seven years or something like that, and and the
Speaker 1: natural tendency is just to think that it's going to
Speaker 1: continue to do what it what it's been doing. Like
Speaker 1: that's just for whatever reason sort of what people think.
Speaker 1: And I get caught into that sum too, but I
Speaker 1: think I just get freaked out more like when I
Speaker 1: see that, it kind of I'm just like, oh man,
Speaker 1: it can't feed this good forever, you know, like I'm
Speaker 1: always writing maybe maybe that means I'm more of a pessimist,
Speaker 1: but I'm like kind of waiting on the other shoe
Speaker 1: to drop, you know, I'm just like you know that
Speaker 1: it's not going to be able to continue this, you know,
Speaker 1: at the at the rate that has been and and
Speaker 1: when I see folks that are buying and maybe spending
Speaker 1: more than they can have, you know, afford or like
Speaker 1: you said, expecting that appreciation and expecting that equity growth,
Speaker 1: that makes me nervous. I completely agree. And actually, but
Speaker 1: I think actually it doesn't make you a pessimist. It
Speaker 1: makes you a realist because the same thing, right, because
Speaker 1: when you look at for instance, you know what's happening
Speaker 1: with the stock market right now, we're having a bit
Speaker 1: of a correction. We'll see if we have even more.
Speaker 1: It is natural human tendency. Though you're completely right to
Speaker 1: say it's going up, and it continues to go up up,
Speaker 1: and any bump in that completely shakes us for the
Speaker 1: most part. In vice versa, if it's going down, it's
Speaker 1: only going to continue to go down exactly, which is
Speaker 1: the exact time that you need to be buying because
Speaker 1: things are on sale. Yeah, and so it's hard for
Speaker 1: us to time those things and to know. But ultimately
Speaker 1: that's why you have to go with some of these
Speaker 1: time tested reasons and methodology and mathematics ultimately behind buying
Speaker 1: a home to make sure that you're buying something that
Speaker 1: you can't afford over time and granted, things happen, right
Speaker 1: like in two thou seven. Like if you bought in
Speaker 1: two thousand and seven and then and then you're you're
Speaker 1: going up towards the recession that hits a No. Eight
Speaker 1: and you lose your job, that's a different story, right,
Speaker 1: you can't plan for that all the way. But for
Speaker 1: the most part, there were a lot of people that
Speaker 1: got caught with their pants down, you know, their hand
Speaker 1: in the cookie jar essentially, and that's what we want
Speaker 1: to avoid. That kind of mentality when it comes to
Speaker 1: buying a home, paints down and handing the cookie jar
Speaker 1: at the same time. Who knew, what are you doing?
Speaker 1: My mom would find me like then they kitchen and
Speaker 1: I'd be like, I'm just hungry, sleeve lock. But I
Speaker 1: guess the first thing that we need to dispel the
Speaker 1: common myth is that renting is throwing away money, and
Speaker 1: so yeah, sort of going back to the same assumption
Speaker 1: where buying is a smart move as a smart investment.
Speaker 1: Just as prevalent is the notion that renting is throwing
Speaker 1: all your money, and that's just not true. Renting can
Speaker 1: be an incredibly smart decision and a wise financial move
Speaker 1: and just a great move for a lot of different reasons.
Speaker 1: But yeah, that's just always the sort of mentality people
Speaker 1: are like, just every month, just throwing away money. It's like, no,
Speaker 1: like there's so much that gives you. And we're gonna
Speaker 1: get into that later, uh in this episode, but just
Speaker 1: kind of write that off in your mind. That is
Speaker 1: not the case. Yeah, you're still getting something for your money, right,
Speaker 1: a place to live and and and flexibility. So we'll
Speaker 1: talk about the pros and running in a little bit,
Speaker 1: but but just no dispel the myth running is not
Speaker 1: throwing away money. So, Matt, before we get into the
Speaker 1: specifics of running versus buying pros and cons, let's talk
Speaker 1: about some of these overarching rules that we need to
Speaker 1: follow whether we're renters or buyers. And first, you just
Speaker 1: don't want to overspend on housing no matter what the
Speaker 1: whether you're renting or buying, you want to make sure
Speaker 1: that you're living by at minimum that rule yeah, which
Speaker 1: is you don't want your housing expenses. So like you said,
Speaker 1: renting or buying, you know, so whether it be like
Speaker 1: a rent check every month or your mortgage, you don't
Speaker 1: want that to be more than of whatever your take
Speaker 1: home pay is and not so not your salary, but yeah,
Speaker 1: this is your take home pay. So this is after
Speaker 1: taxes have been taken out by employer um any amounts
Speaker 1: that are that's going towards retirement savings like your four
Speaker 1: own k. This is what shows up in your checking account, right,
Speaker 1: so every month when you get paid that amount, that
Speaker 1: is the rule. That's what you want to divide that
Speaker 1: out by. And your rent or your mortgage payment does
Speaker 1: not need to be any larger than that. Yeah, And
Speaker 1: it's easy, I think, depending on where you live and
Speaker 1: and who you're who you're hanging out with, to say, well,
Speaker 1: I need to live in this kind of house or
Speaker 1: I need to live in this neighborhood, and those kind
Speaker 1: of choices can balloon your monthly rent or mortgage payment
Speaker 1: really quickly. And so don't be fooled by the way
Speaker 1: people around you are living. If you want to ultimately
Speaker 1: have financial independence one day, if you want to live
Speaker 1: a rich life where you're not house poor. You need
Speaker 1: to think not about what everyone else around you is doing,
Speaker 1: but what you need to do to put your finances
Speaker 1: in right order. And the biggest piece to this puzzle
Speaker 1: is how much of your income every month do you
Speaker 1: spend on housing? That is the biggest piece to the puzzle.
Speaker 1: And if you can make changes there, if you can
Speaker 1: move someplace cheaper, whether it's renting or owning, that's gonna
Speaker 1: have a huge impact on how much you're able to
Speaker 1: save and invest for the long term. Yeah, Jill, I
Speaker 1: mean what we'd recommend is to think about we talked
Speaker 1: about in a recent episode like the your big why
Speaker 1: behind money. If housing is a priority for you, than sure,
Speaker 1: maybe that's something that you can might spend up too
Speaker 1: closer to But for most folks, I think you might
Speaker 1: even find that that percentage to even a lot lower,
Speaker 1: you know, like closer to fifteen or maybe I agree.
Speaker 1: The lower you can get it, the more you can
Speaker 1: stock away for the future, the more quickly you can
Speaker 1: actually be financially independent. That housing costs is the biggest
Speaker 1: line on them that's going to help get you there. Yeah,
Speaker 1: by far. So another overarching point things that you need
Speaker 1: to consider before buying home. And I think these are
Speaker 1: hard and fast rules that you need to have thought
Speaker 1: about this before you actually go through the process of
Speaker 1: shopping for a home, getting financing, and then making offers.
Speaker 1: You need to consider are you going to be in
Speaker 1: the home for at least five years, and if you're
Speaker 1: shopping for a condo even longer than that, probably seven
Speaker 1: to ten years. You want to explain to folks why
Speaker 1: this is the case. Sure, So it comes down to
Speaker 1: a few things. Just like if you're investing in stocks,
Speaker 1: you're not going to invest heavily today in a mutual
Speaker 1: fund knowing that you need the money next year, because
Speaker 1: there's a lot that can happen in a year. Same
Speaker 1: thing with a home not quite as volatile usually in
Speaker 1: a normal cycle, but don't know if it's gonna be
Speaker 1: worth more in a year or two years. You're you're
Speaker 1: hoping that in five years at least you've paid down
Speaker 1: some of the mortgage amount, although you're paying mostly interest
Speaker 1: in the beginning, and then ultimately you've created a little
Speaker 1: wiggle room. But more than that, the biggest thing that's
Speaker 1: gonna drain you is the transaction costs involved involved in
Speaker 1: buying real estate, and there's a lot of people that
Speaker 1: don't take that into consideration. When you're buying a home,
Speaker 1: you're not thinking about it at all, Like the transaction
Speaker 1: costs are usually all in the cellar. But when you're
Speaker 1: selling the home, you're usually giving up a huge piece
Speaker 1: of the profit if you haven't lived there that long,
Speaker 1: and likely even dipping into your own savings to pay
Speaker 1: the agent's fees if you haven't built up much equity. So, Joe,
Speaker 1: you're talking about realtor fees basically, and that alone right
Speaker 1: there is six and then with closing costs on top
Speaker 1: of that when it comes time to sell, which sellers
Speaker 1: often pick up a big chunk of the closing costs. Yeah,
Speaker 1: but I mean you're you're looking at close to ten percent.
Speaker 1: So I mean, quick math, say you are selling your
Speaker 1: home for you thousand dollars. That's thirty dollars that you
Speaker 1: don't get the key. That is a lot of money.
Speaker 1: And if you're expecting that equity growth there within a
Speaker 1: few years for the five years hits and you can't
Speaker 1: bank on that. Yeah, And so typically in a year
Speaker 1: or two or three, you're not going to hit that threshold,
Speaker 1: and you'll be paying money out of pocket to sell
Speaker 1: your house, and that is not a position you want
Speaker 1: to be in. Another big rule that you need to follow.
Speaker 1: I don't think you should really, for the most part,
Speaker 1: even consider buying a home unless you have to put down.
Speaker 1: That's for a couple of reasons. For that equity reason,
Speaker 1: right that it's it's important that if you're buying something
Speaker 1: that you they say for it, and you're financially prepared
Speaker 1: to actually buy this house. And on top of that,
Speaker 1: you also avoid paying private mortgage insurance which is called
Speaker 1: p am I that can typically be hundred plus dollars
Speaker 1: every month that essentially goes to the bank, and so
Speaker 1: it makes your monthly housing costs go up even more. Yeah,
Speaker 1: basically it's just a way for them to get money
Speaker 1: out of you because you're a little higher risk. By
Speaker 1: not putting that money down, they're holding more of the balance,
Speaker 1: which is risk year for them. Oh and that's another
Speaker 1: thing too, is that like basically the more you you're
Speaker 1: able to put down, the better rate you're going to
Speaker 1: get to. And so there's just so many reasons that
Speaker 1: you want to you want to have down. That's sort
Speaker 1: of a solid fast rule and that's something else too
Speaker 1: that I'm afraid we're starting to see some of that
Speaker 1: happening again, some lending where lenders are willing to write
Speaker 1: loans on properties where buyers aren't putting down that And dude,
Speaker 1: if that's not a sign of a potential, I mean,
Speaker 1: there's not gonna be a housing crisis again, right, Like,
Speaker 1: I think that's probably a once in a lifetime thing,
Speaker 1: what what we went through ten years ago, But that's
Speaker 1: still not a great sign. Yeah, I don't know. I
Speaker 1: don't know if it's once in a lifetime. Honestly, I
Speaker 1: feel like human behavior is completely I think once two
Speaker 1: thousand two nine happened, I assumed that people would wise
Speaker 1: up a little bit. Savings rates are back to where
Speaker 1: they were in the toilet, like people making risk ere loans.
Speaker 1: So I I don't know. I don't know if it's
Speaker 1: never never again, I think we'll see it again a
Speaker 1: whole another generation of buyers that didn't learn the previous
Speaker 1: time because they weren't necessarily buying back then. Yeah, so
Speaker 1: I think it's important to put down when buying a home.
Speaker 1: There are very few exceptions. Like Matt said, you're gonna
Speaker 1: get the better rate, you're gonna avoid p m I.
Speaker 1: Even if your house does go down in value, you're
Speaker 1: not gonna be coming out of pocket on top of that.
Speaker 1: Likely in normal circumstances, if you have to sell in
Speaker 1: a hurry, you just want to make sure you're financially
Speaker 1: prepared to buy a home. Ultimately, if you can't afford
Speaker 1: to put down on a home or close to it,
Speaker 1: you just really need to reconsider whether you should be
Speaker 1: a renter for right now until you can save with
Speaker 1: that money. That's true, all right, Matt. So let's get
Speaker 1: into the pros of renting. Then after that we're gonna
Speaker 1: do the pros of buying, all right, So pros of
Speaker 1: renting the first thing geographic mobility and flexibility and also
Speaker 1: a little bit of financial flexibility to yeah, Joel, So
Speaker 1: like the geographic mobility, right, that's kind of obvious. It's like,
Speaker 1: all right, I want to live here for a short
Speaker 1: period of time, check out the city or maybe just
Speaker 1: a neighborhood, you know, to be able to have the
Speaker 1: flexibility and the options to just move to a different
Speaker 1: part of town or even move cities or countries. That's
Speaker 1: incredible freedom that you don't really you're not gonna have
Speaker 1: once you're buying. And the financial flexibility too, that's something
Speaker 1: I don't think folks think about quite as often. But
Speaker 1: when you're renting, your income doesn't need to be quite
Speaker 1: a stable. So you've got a job and you're renting
Speaker 1: at a certain certain dollar amount. If you happen to
Speaker 1: lose your job, well you're gonna be out of that
Speaker 1: lease pretty soon. So it's not a huge deal. It's not.
Speaker 1: It's not a mortgage where you're locked in for say
Speaker 1: fifteen or thirty years, and sometimes you know that maybe
Speaker 1: for the next year or the next shovel several months
Speaker 1: that your your your paycheck is going to be a
Speaker 1: certain amount, but beyond that you don't really know. And
Speaker 1: so it can be tough to sign thirty to forty
Speaker 1: documents saying that you will pay this mortgage, which is
Speaker 1: what happens when you buy a house. But you know,
Speaker 1: sign a lease, there's a little less pressure there and
Speaker 1: it give gives a little more flexibility. Well, let's say
Speaker 1: you're young and you've got a job at a city
Speaker 1: and then you know what, maybe next year you might
Speaker 1: get a job offer in an a whole another city
Speaker 1: for a lot more money geography. Yeah, and you can
Speaker 1: move and if you own a home, it's tethered to
Speaker 1: you in a way that renting is not. And so
Speaker 1: you have this flexibility whether you're young or old, with new,
Speaker 1: new job opportunities, whatever may come along, moving closer to family, uh,
Speaker 1: as your your lifestyle changes, as you have kids, whatever
Speaker 1: it may be. You have this ability to pick up
Speaker 1: and move almost on a whim, essentially because you're not
Speaker 1: tied down to any particular location because of a home.
Speaker 1: Another great reason that geographic mobility is a plus in
Speaker 1: the column of running. Let's say you moved to a
Speaker 1: town and you're not sure what part of town you
Speaker 1: want to live in yet. Oh yeah, that's yeah, that's huge.
Speaker 1: You get to know the city for six months or
Speaker 1: a year while you rent, and then you know exactly
Speaker 1: where you want to buy. So it gives you that
Speaker 1: opportunity to figure out the city, the layout, and then decide, Okay,
Speaker 1: that's that's the side I want to be on. That's
Speaker 1: the commutes bad if I live here versus there, and
Speaker 1: you you learn a lot and so renting can be
Speaker 1: perfect for those times too. Yeah. He gets into traffic
Speaker 1: and like you said, you get to know the neighborhoods.
Speaker 1: I mean, that's exactly what I was talking about at
Speaker 1: the beginning, how the neighborhood that can now lived in.
Speaker 1: When we first moved moved to Atlanta, we didn't know
Speaker 1: anything about Atlanta other than we'd heard of this neighborhood
Speaker 1: and so we're like, okay, But ultimately we realized that
Speaker 1: that's just not the neighborhood where we wanted to live.
Speaker 1: It didn't have the things that we're looking for. And
Speaker 1: that's why we ended up where we are now because
Speaker 1: we had two years of renting up there with all
Speaker 1: utilities included, which was awesome, and we had those two
Speaker 1: years to figure out where it was that we did
Speaker 1: want to live. So, yeah, that's not something we had down.
Speaker 1: But I totally agree with you from you know, personal
Speaker 1: experience right there, man, that, uh, it just buys you
Speaker 1: some time to figure things out. And that's especially true,
Speaker 1: I would say for military families. There's so many military
Speaker 1: families that have to move every two or three years,
Speaker 1: and it can be a tough decision. I know, you
Speaker 1: want to put roots down, you want to own a home.
Speaker 1: There is something really fulfilling about that. And we'll talk
Speaker 1: about that in the next section the pros of buying.
Speaker 1: But it's just not worth the financial heartache that can
Speaker 1: come along with it if you're not going to be
Speaker 1: there for long. So if you are a military family
Speaker 1: in particular, thank you for your service, thank you for
Speaker 1: what you do for our country. But rent is probably
Speaker 1: a better idea if you're only going to be at
Speaker 1: a post for for two years, three at the max.
Speaker 1: It's just not worth renting and getting into all that
Speaker 1: because there's so much when it comes to selling a
Speaker 1: home that's difficult. You're gonna want that geographic mobility factor. Yeah, Jill,
Speaker 1: you mentioned financial hardship. That's a huge benefit to renting
Speaker 1: is you know, when you're renting, you're not tied to
Speaker 1: the housing market. So if things are declining, well, you're
Speaker 1: gonna be losing equity. And so if you're in a
Speaker 1: situation where you have to sell all of a sudden,
Speaker 1: you're you're losing out and you're basically being forced to
Speaker 1: sell when the market's low. If you're running, that's the
Speaker 1: landlord problem. Yeah, you don't have to worry about that
Speaker 1: at all. Something else, you don't have to worry about
Speaker 1: it all when you're renting is fixing stuff that's right,
Speaker 1: that's right. So that's again is the landlord problem. Right
Speaker 1: when the fridge goes bust and I gotta go pick
Speaker 1: up just called Joel at nine at night. I'll bring
Speaker 1: a fridge over to your house. And my mom's to
Speaker 1: five any day. So those are the things that as
Speaker 1: a landlord you have to worry about. And and a
Speaker 1: smart landlord, of course has has benefit if they're if
Speaker 1: they're really smart about what they're doing, if they know
Speaker 1: what they're getting into. But as a renter, there's a
Speaker 1: lot of beauty in the fact that you don't have
Speaker 1: to fix a leaky faucet or a busted air conditioner
Speaker 1: or a roof that's messed up. There are all these
Speaker 1: things that let's say you're not financially prepared to put
Speaker 1: twenty percent down and have you know a fun to
Speaker 1: fix your house. Renting is where it's at because you
Speaker 1: don't have to fix any of those things that come up, Joel.
Speaker 1: That actually makes me think of Mitch Hedberg. Did you
Speaker 1: ever listen to him like back in the day, back
Speaker 1: in college, But I've had so many people quote him
Speaker 1: to me, Dude, he sounds hilarious weed. Yeah, I'll share
Speaker 1: some Mitch Hedberg with you. He's he was, he was,
Speaker 1: he was the best. Make me a mixtape, Matt, I'll
Speaker 1: bring you a disk. It makes me think of a
Speaker 1: joke or like a story or whatever that that he
Speaker 1: would tell, and it was something like I went to
Speaker 1: the home depot yesterday, which was totally unnecessary. What I
Speaker 1: need to do is go to apartment depot where there's
Speaker 1: a bunch of people standing around and saying we ain't
Speaker 1: got to fix anything. Which now, as a landlord, I
Speaker 1: totally understand the beauty of that joke. When I get
Speaker 1: a call for a fridge or for fixing a a
Speaker 1: shed and disrepair or whatever it is, just think of Mitch.
Speaker 1: I think, man, there's some beauty. I'm hustling. I'm hustling
Speaker 1: to make this to make money. As a lord and
Speaker 1: as a renter man, you can kinda coast easy say
Speaker 1: that there's beauty right As from a renters standpoint, I guess,
Speaker 1: I guess that's something you don't really think about as
Speaker 1: a renter, Like at least I didn't when I was
Speaker 1: renting that I didn't have to ever worry about any
Speaker 1: of that kind of stuff. I could just focus on
Speaker 1: other things like starting a business, which which is you
Speaker 1: know exactly what we did. I don't have to worry
Speaker 1: about the air conditioning uh not working anymore because we
Speaker 1: had been overrunning it keeping it at fifty degrees or whatever.
Speaker 1: But yeah, man, there's there's there's there's truth, there no doubt.
Speaker 1: And the other pro of renting you don't have to
Speaker 1: put down a huge down payment. It's like we said, really,
Speaker 1: if you want to buy home, you should have of
Speaker 1: the purchase price to put down as a down payment. Yeah,
Speaker 1: that is a lot of money, I think until you
Speaker 1: start actually doing the mathematics, like you said earlier, like
Speaker 1: that's a ton of money. Like if you're looking at
Speaker 1: buying a two dollar home, that's forty grand plus other
Speaker 1: expenses associated with it. And we're not even I don't
Speaker 1: think I even have time to get into all this,
Speaker 1: but like the inspection, the appraise, like these are all
Speaker 1: things that that go into the purchase of a home. Paint,
Speaker 1: minor repairs immediately when you move in, not to mention
Speaker 1: major repairs that can come up. I mean, ultimately you
Speaker 1: probably need to have closer to in savings for the
Speaker 1: home price because you'll want that ten percent for those
Speaker 1: other things to be able to do little stuff that
Speaker 1: should be our new rule. Or you can't buy a home.
Speaker 1: And the big thing that with with that for me
Speaker 1: is there's a big opportunity costs. Yeah. I thought you're
Speaker 1: gonna talk about that to give up forty dollars on
Speaker 1: a two dollar home that you could have put elsewhere.
Speaker 1: So let's say you put that forty dollars towards getting
Speaker 1: an education, which might ultimately make you more money over
Speaker 1: the years and more bank for your butt. Yeah. Or
Speaker 1: you put into the stock market to work for you
Speaker 1: over the next twenty or thirty years with compounding interest,
Speaker 1: that's gonna be a lot more for you in retirement.
Speaker 1: So I'm not saying that it's not worth while to
Speaker 1: do that. I'm just saying that is a pro renting
Speaker 1: that you can have more of your cash available to
Speaker 1: put towards things that you want now or saving and
Speaker 1: investing for the future further down the road. And that's
Speaker 1: just a huge chunk of change that you're gonna need
Speaker 1: as a down payment that could go elsewhere. Yeah, man,
Speaker 1: I agree. So you want to get into the pros
Speaker 1: of of buying next, let's do it, because I feel
Speaker 1: like we just made renting sound real good. Yeah, at
Speaker 1: the beginning of the episode, you talked about how much
Speaker 1: you like owning a home, and I talked about how
Speaker 1: much I like renting, or how much I did like renting.
Speaker 1: I should say, yeah, there's definitely huge pros, huge advantages
Speaker 1: to owning a home, and uh, yeah, let's let's get
Speaker 1: into that now. It did just make me a little
Speaker 1: tired thinking about all the things I do owning four
Speaker 1: homes essentially my own home and three investment properties. I
Speaker 1: was like, man, I do have a lot of things
Speaker 1: I have to ex all the time, and you get
Speaker 1: a fridge in the middle of the night times four exactly,
Speaker 1: and stuff like that. But ultimately, there are so many
Speaker 1: pros also to buying a home, and let's go through
Speaker 1: those now. Yeah, man, the number one being that the
Speaker 1: value of your home tends to rise over time. Yeah,
Speaker 1: you're gonna see the equity grow in your home most often.
Speaker 1: I mean, it's not a guarantee, obviously, but that's a
Speaker 1: great way for folks to essentially build wealth in an
Speaker 1: era where folks are under saving anyway, it's good to
Speaker 1: know that at least by default, some of your monthly
Speaker 1: mortgage amount is going towards principle, and then the growth
Speaker 1: obviously of your house appreciating over time. Yeah, and if
Speaker 1: you're going to meet that five year rule or what
Speaker 1: should likely probably be even more like a seven year rule,
Speaker 1: if you're gonna stay in your house that long or
Speaker 1: even longer, if you're gonna make a long term decision
Speaker 1: about where you live and you're buying, that equity factor
Speaker 1: really matters and really comes into bear. The further you
Speaker 1: get along your loan, the more you've paid down, and
Speaker 1: then the more that the value of the home has risen,
Speaker 1: you're starting to see, Man, there's actually some decent equity
Speaker 1: over time. But you can't be shortsighted if you have
Speaker 1: your sight set on staying in a place a long time.
Speaker 1: The build up an equity can be a really huge perk.
Speaker 1: And something else that we will also see kind of
Speaker 1: climb over time. Generally speaking, our rents, right, and so
Speaker 1: in most cities and most markets, rents continue to rise.
Speaker 1: And when you purchased a home and you have a
Speaker 1: fixed rate mortgage, your payment is locked in. Certainly, your
Speaker 1: taxes and your insurance will change slightly here and there,
Speaker 1: and that will have an effect on your scrow, which
Speaker 1: ultimately affects your payment. But over the long haul, your
Speaker 1: payment is really pretty much gonna stay close to what
Speaker 1: it is now, which is awesome. How cool is that
Speaker 1: to know that we've got fixed rate mortgages and dude,
Speaker 1: in like ten years, our payments are basically going to
Speaker 1: be the same that they are now. And I do
Speaker 1: not even want to think about where rents are going
Speaker 1: to be in ten years. You have no doubt that's
Speaker 1: a huge park because if you're a renter in a
Speaker 1: lot of cities right now, the way rents have been going,
Speaker 1: it's it's kind of shocking the increases every year sometimes,
Speaker 1: and like we said, you know, what happens today doesn't
Speaker 1: determine tomorrow. Like rents going up right now doesn't mean
Speaker 1: rents are going up next year or the year after that.
Speaker 1: Apartments are being built and that could calm down a
Speaker 1: lot in the near future. But ultimately, the security of
Speaker 1: knowing that the mortgage you have in place isn't going
Speaker 1: to change much and that rents can climb a lot
Speaker 1: over the years, that can make a huge difference. You know,
Speaker 1: over time, Essentially as your monthly payments stay the same
Speaker 1: and someone that's renting, there's go up by a lot. Yeah,
Speaker 1: security man. And another aspect of security two is just
Speaker 1: knowing that you've got a place to live. Right, So
Speaker 1: as long as you keep making your payments every month,
Speaker 1: when you've got a mortgage, you get to stay in
Speaker 1: the house. Uh, No one's gonna kick you out. Versus
Speaker 1: even if you're an on time paying tenant and your
Speaker 1: your renter, there's a chance that the landlord may not
Speaker 1: renew your lease for that next year. He might decide
Speaker 1: to run it out to a friend or cousin, or
Speaker 1: might be time to sell. I mean, there's just so
Speaker 1: many considerations when it comes to investment properties. So if
Speaker 1: you really want to put down roots where to me,
Speaker 1: that's like the biggest factor in wanting to buy a
Speaker 1: house versus renting. If I really want to put roots
Speaker 1: down somewhere particular, Buying a home gives you that ability
Speaker 1: to be locked in in a specific location on a
Speaker 1: specific street with specific neighbors over the long term, and
Speaker 1: as a renter, you ultimately don't get to make that choice,
Speaker 1: which can be one of the harder aspects of being
Speaker 1: a renter. Yeah, just the having to move. And that's
Speaker 1: the other thing too, is moving gets expensive, you know,
Speaker 1: like if you're having you know, say you find a
Speaker 1: great place that you like and you're there for a year,
Speaker 1: but then they end up selling it or they jack
Speaker 1: up the rent too much and you ultimately I want
Speaker 1: to go somewhere this cheaper, having to move every single time,
Speaker 1: and it just sounds exhausting. Yeah, So on that plus side,
Speaker 1: right for renting, you had that geographic mobility, but on
Speaker 1: the downside, you have to pay to move essentially every
Speaker 1: time you want to go somewhere different. Hopefully you don't
Speaker 1: have a ton of stuff. And another probe buying a
Speaker 1: home is you have the creative freedom to change things.
Speaker 1: So a landlord determines paint colors on the wall and
Speaker 1: the floor plan essentially can't be changed as a renter,
Speaker 1: but as a buyer, you can make it whatever color
Speaker 1: you want bright orange, uh, and you can you can
Speaker 1: plant plants outside, you can make additions, you can renovate
Speaker 1: a bathroom. You've got. It's really essentially at your disposal
Speaker 1: as as the owner of the home. And that's kind
Speaker 1: of cool that making it your own kind of place.
Speaker 1: That's not unique to like Americans, is like anywhere people
Speaker 1: like to live, like making it their own, like little
Speaker 1: touches here and there and more than just a throw rug.
Speaker 1: You know. Yeah, I'll do. Something we haven't talked about
Speaker 1: yet either, is the tax benefits of owning. I mean
Speaker 1: that's a huge sort of financial one too, where if
Speaker 1: you have a home and when you're making mortgage payments,
Speaker 1: a portion of your payments goes towards taxes, and a
Speaker 1: portion of that goes towards interests, and a portion of
Speaker 1: that goes towards principle, well you can the ducts the
Speaker 1: portion that goes to taxes and the portion that goes
Speaker 1: to interest from your oarned income. Is that something like
Speaker 1: I count on. It's kind of intangible when you're gonna
Speaker 1: added us. Yeah, it's like an ad added bonus thing.
Speaker 1: But um, it's definitely a nice benefit. You know. Like
Speaker 1: I've never sat down in be like, all right, how
Speaker 1: much would I would I actually owe in taxes this
Speaker 1: year if I didn't own a home, but it would
Speaker 1: actually it might be like a nice exercise to do that. Yeah,
Speaker 1: it would be. I think most people probably put too
Speaker 1: much stock in that and they're like, I gotta buy
Speaker 1: a home because of the mortgage intersduction. Yeah, like, who, No,
Speaker 1: that is not a reason. That is a poor reason
Speaker 1: to buy a home, but it is an added perk
Speaker 1: of home, yeah, totally. And something else too, it dude,
Speaker 1: is when you own a home, too, it gives you
Speaker 1: the ability or the options to potentially convert that home
Speaker 1: that you lived in into a rental. That's something you've
Speaker 1: done twice now, it's something that Kate and I have
Speaker 1: done once. And you know, when you're running, you just
Speaker 1: don't really have that option. But to be able to
Speaker 1: convert something that you were enjoying, uh from a sort
Speaker 1: of personal standpoint too, then kind of transform that into
Speaker 1: something that makes you money into something that provides a
Speaker 1: stream of income, that's awesome. Yeah. Or even subletting while
Speaker 1: you still live there, Yeah, running out a room on
Speaker 1: Airbnb or to a friend, stuff like that that can really,
Speaker 1: you know, cut your housing costs. So I think if
Speaker 1: you are buying a home and you're planning on subletting
Speaker 1: a portion of it too, that's another good perk. Oh yeah,
Speaker 1: you can use it however you deem fit. Whereas if
Speaker 1: you're renting a home, there are usually clauses in place.
Speaker 1: You might want to read your lease thoroughly because you're
Speaker 1: probably not allowed to sublet. But if you own that home,
Speaker 1: you can essentially cut your housing costs by renting portions
Speaker 1: of it out to other people. Yeah, which you did.
Speaker 1: I feel like I kind of missed the boat on that.
Speaker 1: You know, I didn't consider buying a home, and so
Speaker 1: after I was I was married, and so I've got
Speaker 1: my built in wife roommate, uh, which is awesome, But
Speaker 1: I don't want to make it sound like I totally
Speaker 1: missed out I'm living with other dudes that didn't clean
Speaker 1: up after themselves, because that kind of sounds terrible a
Speaker 1: financial side of it. You know, if we can make
Speaker 1: that happen for you, buddy, we can put you in
Speaker 1: that like Big Brother House on TBS or whatever that is. Yeah.
Speaker 1: I think that's just a really cool way to be
Speaker 1: able to reduce your monthly mortgage payment by by sharing
Speaker 1: the space sub letting it. So we've talked about the
Speaker 1: pros of renting, the pros of buying. Ultimately, what it
Speaker 1: comes down to in so many ways is where you're
Speaker 1: at in your lifestyle and if you're prone to moving
Speaker 1: if you're tired of your job and are thinking about
Speaker 1: applying for jobs in other cities, or if you're in
Speaker 1: an industry where you know there's like a lot of movements,
Speaker 1: not just within the company, but if that means just
Speaker 1: literally moving geographic locations as well. That's something you need
Speaker 1: to keep in mind when it comes to making this
Speaker 1: decision of should I rent or should I buy? So
Speaker 1: much of it comes down to lifestyle and where you're
Speaker 1: at in life. It's not well who renting one or
Speaker 1: well who buying a house wins. They're both fantastic decisions
Speaker 1: for different people at different points in their lives, and
Speaker 1: hopefully we've dispelled some of the myths that renting is
Speaker 1: throwing away money and that buying a home is always
Speaker 1: a good investment. Yeah, Joe, I think that's just the
Speaker 1: biggest thing that that folks need to take take into account,
Speaker 1: right where are they in their life and make the
Speaker 1: decisions that are appropriate for that period. Might toss that
Speaker 1: question up or something similar, I guess up in our
Speaker 1: Facebook group just talking about if folks had ever regretted,
Speaker 1: you know, say, purchasing at home, and speaking of lifestyle,
Speaker 1: someone had mentioned about building a home or purchasing a
Speaker 1: home before they had kids, and when the time came
Speaker 1: and they had to start considering schools, they realized they
Speaker 1: needed to move. And so for them, I don't want
Speaker 1: to say that like renting necessarily would have been a
Speaker 1: great option, But at the same time, had you've been
Speaker 1: in that situation, I guess if you're renting, there wouldn't
Speaker 1: be the I guess potential for for financial loss quite
Speaker 1: as much if you're renting versus buying in that situation. True. Yeah,
Speaker 1: and for anybody that thinks that buying a home it's
Speaker 1: just slam dunk always a good idea. And I think
Speaker 1: most people in our age, especially after seeing our parents
Speaker 1: go through the Great Recession and we were kind of
Speaker 1: coming of age at the same time, most people in
Speaker 1: our age group, I feel like that notion is mostly dispelled.
Speaker 1: Buying a home equals always good. But if you're doubt,
Speaker 1: check out our Facebook group and you'll see some of
Speaker 1: the stories. For instance, Amy wrote, purchasing our last home
Speaker 1: is my biggest financial mistake, and there were a few
Speaker 1: folks like that that kind of quickly touted their stories
Speaker 1: of buying a home and how it actually did not
Speaker 1: work out. In their favor, and the market that we've
Speaker 1: had lately has been really irregular. It's been a market
Speaker 1: on the rebound, and so to expect things to continue
Speaker 1: to go the way they've been going and to think
Speaker 1: appreciation is going to happen at this sort of torrid pace,
Speaker 1: that's not going to be the case. And you need
Speaker 1: to make sure that the fundamentals behind why you're buying
Speaker 1: a home and how much money you're bringing to the
Speaker 1: table make the decision to buy a home actually makes
Speaker 1: sense for you, all right, Matt. Back to the beer,
Speaker 1: Juice Bar pale Ale from Wrecking Bar Group Pub, one
Speaker 1: of my all time favorite breweries. This is a beer
Speaker 1: that the more I drink it, the more I like it,
Speaker 1: you know, like I feel like some of these beers
Speaker 1: kind of by the end of it, your there's some
Speaker 1: palette fatigue, and even though I love beers with tons
Speaker 1: of flavor, sometimes you're kind of getting you're like almost
Speaker 1: ready for it to be done. You're ready for it
Speaker 1: to be done with and you're ready to kind of
Speaker 1: move on. And that is not the case with this one.
Speaker 1: I'm getting towards the end of it and I really
Speaker 1: could just crack open another one of these, I think,
Speaker 1: and uh, polish it off. I agree, super hot forward,
Speaker 1: but really mellow and light and so really easy to drink.
Speaker 1: This feels really crushable but with lots of flavor and so,
Speaker 1: like we were talking about at the beginning of the podcast,
Speaker 1: session beers, and this is more like a session pale ale.
Speaker 1: Ideally you wanted to be one that you could drink
Speaker 1: three of in a row. And three beers that's a lot, man,
Speaker 1: it is. And and and that's not normally what I want
Speaker 1: in a beer, Like we're drinking one beer. I normally
Speaker 1: I limit myself. But this is a great beach beer.
Speaker 1: It's like at the beach, you do want three beers,
Speaker 1: right because you're the hydrated basically, and and beer helps dehydration.
Speaker 1: If you're not the hydrad you can swim out into
Speaker 1: the ocean and then go to the bathroom and exactly.
Speaker 1: So this is yeah, great for for like a man
Speaker 1: Saturday afternoon hang or something like that, where where you
Speaker 1: want a couple of beers that day, but you don't
Speaker 1: want to be tipsy after your first one. Oh man,
Speaker 1: the beach. That's why I was thinking about this beer.
Speaker 1: Like you're saying at the beach or whatever. A lot
Speaker 1: of folks have been, I guess recently gone to the beach,
Speaker 1: but we haven't. But I know that we're gonna be
Speaker 1: going to the beach together soon. I'm pumped for that
Speaker 1: next month. It's gonna be awesome. Can we record an
Speaker 1: episode together while the waves wash over our feet at night?
Speaker 1: At night on the beach? Yeah, sitting there, that sounds romantic.
Speaker 1: We'll think about it. So yeah again. Great beer juice
Speaker 1: bar Pale Ale from Wreaking Bar. If you live in
Speaker 1: Atlanta or you're visiting, check it out. Awesome group pub.
Speaker 1: I guess give out the good work. All right, jel,
Speaker 1: let's do our final recap. So yeah, mat. The first
Speaker 1: thing in overarching rule, make sure you're not overspending on
Speaker 1: your housing costs. You don't want to be house poor.
Speaker 1: Whether you're renting or buying, make sure that your overall
Speaker 1: housing costs are less than twenty of your take home pay.
Speaker 1: A couple of quick rule to consider before you buy
Speaker 1: is to make sure that you're gonna be sticking around
Speaker 1: for a number of years. Uh specifically, you want to
Speaker 1: be there for at least five years. And also to
Speaker 1: make sure you have at least down to put down
Speaker 1: on the home. That's going to get you a better rate,
Speaker 1: and that also allows you to avoid p m I,
Speaker 1: which can sometimes cost you a couple hundred dollars a month. Yeah,
Speaker 1: that also means you're financially prepared to buy the house.
Speaker 1: But some of the pros of renting geographic mobility, and
Speaker 1: there are so many people that need this, whether you're
Speaker 1: young or old, in the military or regular civilian employee.
Speaker 1: The ability to move wherever you want every year because
Speaker 1: you're a renter, and you can't underestimate that pro of renting. Yeah,
Speaker 1: and not just for reasons for like your job, but
Speaker 1: just say moving from one neighborhood to the next, right, yep, exactly.
Speaker 1: Also not having to fix anything, And if you are
Speaker 1: a renter right now, you might take that for granted,
Speaker 1: but but please don't because that is a huge perk.
Speaker 1: And not having to deal with a busted air conditioner
Speaker 1: or a roof that needs to be replaced. Those can
Speaker 1: be really really costly repairs, and not having to deal
Speaker 1: with those allows you to focus more on building a
Speaker 1: business or pursuing other things that you want to do. Really,
Speaker 1: it's just less responsibility in general. Yeah, man. And then
Speaker 1: so a couple of pros of buying is that typically
Speaker 1: your mortgage amount is going to stay the same while
Speaker 1: rents will continue to climb and rise in the country,
Speaker 1: your mortgage will fluctuate a little bit again with insurance
Speaker 1: and taxes, but for the most part, you're gonna lock
Speaker 1: in that expense as sort of a fixed monthly amount
Speaker 1: and that's not going to change until you pay off
Speaker 1: your mortgage. Again, there's also a huge security in knowing
Speaker 1: that you can stay in your house no matter what.
Speaker 1: If you're a tenant, your landlord has ultimate say over
Speaker 1: whether you stay in the house from year to year.
Speaker 1: They might want to sell it or rent it out
Speaker 1: to a friend, or raise the rent exorbitantly that you're
Speaker 1: not willing to pay. If you're on the home with
Speaker 1: a fixed rate mortgage, you don't have to consider that,
Speaker 1: and whether you want to stay in that home is
Speaker 1: ultimately up to you. And again, these are just a
Speaker 1: couple of the pros of renting and the pros of buying.
Speaker 1: I guess that maybe we're most drawn to but yeah,
Speaker 1: hopefully we were able to give you something to think
Speaker 1: about and definitely consider before you start automatically making the
Speaker 1: assumption that renting is is throwing away money and that
Speaker 1: purchasing a home is always the wise decision financially. Yeah,
Speaker 1: I know, the waters can be a little money, and
Speaker 1: hopefully we cleared things up just a little bit. Ultimately,
Speaker 1: the biggest factor comes down to your lifestyle, where you're
Speaker 1: at in life. Do some thinking about where you're going
Speaker 1: to be in five years and if you're planning on
Speaker 1: being in the same place, that really helps you make
Speaker 1: that decision. But don't buy a house because that's what
Speaker 1: everyone else is doing or because that's what you've been
Speaker 1: told is the right move. All right, man, let's wrap
Speaker 1: it up. Our home on the web is how Some
Speaker 1: Money dot Com. We'll have some show notes up there
Speaker 1: for you. Thanks everyone for listening. Best Friends Out, best
Speaker 1: Friends Out. M