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cedarapple t1_iwvo7bg wrote

Reply to comment by TheJanks in Home sales fell for the ninth straight month in October, as higher mortgage rates scared off potential buyers by ChocolateTsar

The standard deduction in 2022 for single filers is $12,950 and $25,900 for joint filers. Getting a house for the interest rate deduction is one of the dumbest reasons to buy.

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Amerisu t1_iwvsuwt wrote

True, but at least you're getting some equity from your payments.

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TheJanks t1_iwvv4a8 wrote

More like trying to buy the house so we’re not throwing away rent. The tax deduction is trying to be a silver lining

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cedarapple t1_iwvzian wrote

You are not "throwing away rent", you are renting a place to live in. When you buy a property you are making a mortgage payment in order to have a place to live in. In the first ~10 years of a mortgage nearly all of the payment consists of interest (sort of like paying rent to a bank for the use of its money) with a small portion of the payment going to principal (equity).

When deciding whether or not to buy you should determine if renting is less or more expensive than buying a roughly equivalent house with a mortgage payment (taking into account higher maintenance and insurance costs for owners). Also consider the increased flexibility that renting offers for relocating if necessary.

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ScrewAttackThis t1_iwwmt8y wrote

>Also consider the increased flexibility that renting offers for relocating if necessary.

That's been a big one for me. I haven't lived in a single city for more than a few years the past decade. Buying just never made sense. Now home prices are so high it doesn't make sense. Somehow they went up like 50% in 2 years. How that's supposed to be sustainable is beyond me.

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zzyul t1_iwwabwa wrote

And if someone recently bought a house for $600K and has to move in 2 years and it’s only valued at $500K, they threw away $100K buying at the top of the market. Buying is not always the best option.

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TheJanks t1_iwwlcpu wrote

Oh I know.

After plugging in the numbers and taking into account the market right now, I think waiting at least half a year may be smart then revisit.

The neighborhood with new construction was throwing out incentives and looking at 90% drop in home sales, this is not going to get better quickly.

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