Sunday, December 10, 2017

You Should Buy A Home

At least once a week, someone will ask me when I'm going to buy a home.  It started in residency, and it has increased in frequency with every year that I continue to "throw my money away" on rent.  In residency, it was easy to justify not buying a home, because I had over $200,000 in debt and I had no time for home maintenance.  People could understand those reasons.  But as soon as I became an attending, paid off a lot of my debt, and stopped doing 28 hour-plus call shifts, those reasons disappeared.  And suddenly, my renting instead of owning became some sort of personal affront to people who own their homes.

These zealous home owners seem to have made it their personal mission to get me to buy a home too.  They will send me listings in my favourite areas, along with messages about how perfect the living room would be for a games night or how much I would love the granite counter tops.  Any time an article is published that extols the virtues of home ownership, I can expect at least two or three of these people to send it to me.  And if I dare say anything even remotely critical of my apartment, I am immediately subjected to a tirade about how much better owning is and how ridiculous it is that I'm still renting.

But you know what?  I like renting.  For a lot of reasons.

I am not throwing away my money:  I have used various calculators to compare the cost of renting and owning in my situation, and based on the home I would likely buy, renting comes out a few hundred dollars a month ahead of owning.  So contrary to popular belief, I am actually saving money by renting.  People immediately respond by saying "Well...paying a mortgage is forced savings.  No one actually has the discipline to invest the money they save by renting."  To which I just laugh.

I like putting almost zero effort into my home:  This summer, while we were out for dinner with friends, I got a phone call that my kitchen sink had overflowed and was flooding the apartment below it.  My (now ex-) partner had to run home to shop vac up the mess, but otherwise the building took care of everything, including paying a plumber premium rates to come out on a Friday evening.  The cost to us was zero, and the time involved to deal with it was minimal.  As has been the case for anything else that has gone wrong with the apartment.  The only maintenance I'm responsible for is replacing the light bulbs!  There is no snow to shovel, no leaves to rake, no grass to mow.  And I love it.

I love my location:  The ex and I started looking at homes earlier this year, and when we talked about where we wanted to live, we both decided that we were already living in the perfect neighbourhood.  It generally takes me 15 minutes or less to drive to and from work, which gives me so much more free time than the crazy people who drive 45 minutes or more to the suburbs.  My apartment is in mature area with old houses and lots of trees, so it's a beautiful place to walk when the weather is nice.  I'm within walking distance of two major restaurant areas, so I can have a drink or two without worrying about driving home.  I can even walk to the library!  Because it's a very desirable and popular neighbourhood, the housing prices here are high.  So I'd be paying even more than a few hundred dollars a month extra to have a nice house or condo in the area where I'm already happily living*.

My apartment is nearly perfect:  In addition to location, there are a lot of things I love about my apartment.  I have huge balconies (plural) to sit on; there are two washing machines and two dryers just down the hall; there is an exercise room that I use on occasion; there's an indoor hot tub; and I have heated indoor parking.  The size of my apartment is pretty perfect for a single person with minimalist tendencies.  My building is also filled with dogs who love to visit, which means I get the pleasure of enjoying other people's dogs without ever having to pick up their poop. 

I hate the idea of taking on more debt:  Although all the other reasons are valid, this is probably at the heart of why I am not looking to buy a home right now.  I still have a six-figure debt, and on my current repayment schedule I'm four years away from paying it off.  The idea of adding a six-figure mortgage to that makes me want to vomit.  "But it's good debt," people say.  Gaaaaahhhhh.  No.  It's still debt.  It's still money that I would owe to someone else, which would limit my choices and almost guarantee that I would have to stay at my current job until the debt is gone.

I may buy a home someday.  Once the debt is gone and I've saved a bigger nest egg for retirement, I can see myself being interested in buying a place.  Something with a bigger kitchen and more space to entertain and hardwood floors, because carpets are gross when you have cats.  But at the current moment, renting works for me.

Which ties into one of the most important (and cliché) things I've learned about personal finances:  it's personal.  Everyone has their own unique circumstances, preferences, and neuroses, so there is no one perfect formula for life happiness and financial success.  Lots of people want to buy a home, and it makes sense to them, so great!  Buy a home.

Just stop telling me that I should too.

*I looked at an apartment condo a few buildings down from where I'm living, and the condo was over half a million dollars with condo fees that were only slightly less than my rent.  It was a really nice condo, but OMG talk about throwing money away.

22 comments:

  1. The best reasons not to buy are a) maintenance is annoying, b) it restricts your mobility more than a rental, c) the money you sink into it is not liquid. That said, buying is so much cheaper than renting in my area (at least it used to be). We spend approximately $800 less per month than we would for a comparable rental, and we can do almost anything we want with it. We are also prepaying so will pay less interest than otherwise. I do occasionally fantasize about never having to call a plumber or electrician again, however.

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    1. Yes! All of those reasons are true. I would be more willing to buy a place if it would save me money, but the only way I could get an equivalent place for less would be to move far away, which I have no desire to do. So I will continue to rent until I can justify (to myself) buying a really expensive place that I love.

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  2. I love renting. I rent a home with roommates so we do have to care about lawn maintenance, but there are enough of us to split the cost of having someone else do it for us. It looks nicer than I would (did) do it and I don't have to spend time on the grasses' schedule. I seriously don't like when folks who won't be signing the bill or getting me to work have an opinion about what I do. I should be trusted to make the best decisions for my own darn life.

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    1. The world would be a much better place if everyone just followed the logic of "I should be trusted to make the best decisions for my own darn life." The whole "gay people shouldn't be allowed to marry" argument could be erased by that one piece of good advice!

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  3. I love owning and all the chores that come with land stewardship. But sometimes, to think of a weekend without chores - what a delight. Glad you enjoy it.

    Now I'm off to drop off the compost and feed scraps to the chickens and check for eggs and probably water the garden and on and on and on and on ...

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    1. I do enjoy my chore-free weekends! Glad you enjoy your chickens.

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  4. Two thumbs up from this personal-finance-on-Mondays-blogger.

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  5. My brother owns his apartment. It seems to be the best of both worlds. He has equity, but can lock the door and leave for a week or two without much worry. It works for him.

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    1. When I do buy, there's a good chance that I'll buy an apartment condo. I don't need a ton of space, and I don't really enjoy outdoor stuff.

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  6. I wish people would realize that there is no one-size-fits-all approach to life!

    I bought a condo 7 years ago - because I was tired of having housemates and living alone would cost me more than a mortgage would. Plus I like the concept that by 2020 I will no longer have a monthly house payment.

    But home ownership is a personal thing - it really depends on your location and situation - and people should totally respect the fact that you've looked at the numbers and renting works for you!

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    1. That's a pretty efficient timeline for paying off your house! And yes...life would be better if people would stop trying to make everyone conform to some ideal of the "good life".

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  7. I also get this often, including the "but you're throwing money away" argument, to which I say, no, "I'm paying for everything to be someone else's problem."
    I think it's hard because for a certain segment of people they view it as some necessary adult step (like getting married or having a child) and honestly for some people (particularly in Toronto) I think they feel more comfortable when others normalize taking on a huge amount of debt, and you're sort of upsetting the balance when you don't want to get involved.

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    1. Housing prices in Toronto are crazy! If I lived there I can't imagine ever buying a place, despite being a person who could (somewhat) afford to do so.

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  8. For the longest time, I thought I wanted to buy a house. I even went so far as to find an agent and look at houses. I've finally come to the realization that I prefer renting! I don't have to worry about outdoor maintenance, I don't have to worry about coming up with a lot of money in a hurry when something needs to be fixed, and I can go away on holidays without having to find a house-sitter. If I need to move, I can just give in my two months' notice instead of trying to find a buyer. And as a single person, I also feel a lot safer in an apartment. I'm on the seventh floor so I don't have to worry about anyone climing in my windows!

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    1. I'm happy to hear there are other people who prefer to rent. It definitely has its advantages. The two month notice side of it is great (although I have a one-year lease here, which kind of sucks).

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  9. My biggest thing with renting vs buying is that with buying, at least my costs are generally consistent and I know what they will be. In contrast to the place my dad's been renting that increased the rent by more than 60% suddenly. And restrictions on pet ownership are a problem for me, naturally.

    Buying can be good for building equity if that's a goal but why on earth would anyone take it on solely for that purpose considering all the costs? It's a ton of work and money (property tax, maintenance, interest on the mortgage, repairs, on and on and on)!

    I feel like it's like parenting. People feel like they need other people to join their boat to feel validated or something.

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    1. It's funny that stable costs are a motivation for you, because that's part of my motivation for renting. We have limits on how much rent can increase in my city (I think it's 3-4% per year?), and my building hasn't increased my rent in the 7 years I've been here (loyalty discount). It feels far more secure than buying a home, which could easily have a furnace die or a roof need replacing, but I recognize that this is somewhat unique to my situation.

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    2. We both have the right, different, answer to the same question! Isn't personal finance grand? :) Given the choice, I'd rather rent but that doesn't work well here.

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  10. As someone who accidentally clogged the kitchen sink by attempting to flush coffee grinds down (yes, I'm an idiot), not dealing with maintenance/repairs is a huuugge thing for me. My girlfriend jokes that it's better I learn now while we have an on-call maintenance person in the apartment building before we buy something and have to pay an arm and a leg for someone to fix my stupid mistakes.

    Not to mention, the whole being in $500,000 debt for a 1 bedroom condo is Toronto is not particularly appealing.

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    1. Ha! I have a bad habit of putting things down the sink that I shouldn't, but I'm trying to stop after having my sink back up twice. (Only partly my fault...it's mostly because everyone in my building puts stuff down the drain, and the building had not been properly maintaining the pipes.)

      I don't understand how anyone can pay $500,000 for a condo. And I'm a doctor! It just seems crazy.

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  11. I've read on the average from a total cost POV, Owning is a 1% drag on investment.

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