[MightyDog]

Originally Posted by Stu from NYC

If these are your expectations hope you have a rainy day fund if you are wrong.

"Wrong" in what way?

If somebody has hundreds of thousands in cash, by definition, they have a rainy day fund for whatever life kicks-up.

I'll add that I've seen plenty of $$ haircuts (not catastrophic) for people who bought in latter 2020 to early 2022 and sold in the last 6 months or so. That wound-up being a buy high/sell low situation for them. And painful for some sellers who sat for months with an overpriced house for sale. Some of the asking prices are still dumb and continuously getting shaved.

[MightyDog]

Originally Posted by Randall55

We are currently renting a small home for $1950 a month. We have to pay electric and wifi. Our social security checks pay for all plus plenty to spare for food and necessities. Our money is sitting collecting interest. We understand this can not be a forever situation. We know the cost of living will eventually go up.

We are watching the housing market carefully and looking for a home that will provide us with equity on day one. Deals are out there! We found a few but passed because they were not our ideal. When we find THAT ONE, we will pounce on it. If it needs remodeling, we are okay with that.

We went through every floor plan of new construction homes and there is not one we would not have to change to fit our comfort level. For us, buying a preowned will be cheaper long term. (No bond, lower taxes, low maintenance, etc) We are hoping the money we earn in interest will significantly help cover the cost of remodeling.

Everyone has to crunch their own numbers. In this housing market, It is a gamble whichever path you choose. We are waiting for a golden opportunity that keeps us at the lowest risk. There is a saying, 'good things come to those wait." Will it work for us? Or, are we being penny wise and pound foolish? Only time will tell.

100% agree with all. The exception being, in current conditions, it's not necessarily a gamble. If someone can engineer a scenario that only costs them $6000 to 8000, net out of pocket to live -- that's a deal, pure and simple.

It also affords them plenty of time to decide if they want TV for long term and to scope the housing market. Because, you're right, there are some nice deals that show-up and you have to be ready to pounce since they tend to get nabbed in 10 days or less, is my observation.

[Villager1234]

My crystal ball says rents will stabilize or drop slightly because of all of the new homes being sold to investors. I am a retired tradesman with a little knowledge of mechanical and structural systems (enough to get me in trouble). A person under stress who doesn’t have the experience may get taken advantage of or a least overpay for services

[Randall55]

Originally Posted by Villager1234

My crystal ball says rents will stabilize or drop slightly because of all of the new homes being sold to investors. I am a retired tradesman with a little knowledge of mechanical and structural systems (enough to get me in trouble). A person under stress who doesn’t have the experience may get taken advantage of or a least overpay for services

I was a contractor, now retired. The scenario you described happens FREQUENTLY in the Villages. Good news? Preowned homes have most of the expensive upgrades completed. Many done extremely well. At the same cost as the builder material new, you can find a quality resale that only needs cosmetic changes. New floors, counters, paint, and perhaps tile work. Easy! Best of all, preowned have no bonds and lower taxes.

We are going to continue to rent until we find THAT SPECIAL HOME. Until then, life is good not having to deal with the hassles of maintaining a home. I COMPLETELY understand your viewpoint. Here's hoping interest rates stay up and investors blindly keep buying. What a terrific scenario for renters.

[Villager1234]

Originally Posted by jimbomaybe

Taxes on the income, write off on mortgage interest, of course there are many things that only the future will reveal, home ownership has always been a reasonably good investment in the longer term, at least in the past

Yes I agree. I don’t think I have time for a long term investment. We aren’t going to live forever. If I purchase a house when I go any equity will probably be eaten up by my kids preparing the house for sale, the expenses while selling,real estate commission, legal fees, etc
If I keep it in CDs they just go to the bank and get their money ( I hope that they remember to call a funeral director to pick me up ☺️)

[CoachKandSportsguy]

Originally Posted by Villager1234

Yesterday I read about the lady who is having problems with house closing
There are alternatives to purchasing. I moved here 2 years ago, finally found a yearly rental
I closed on my house up north last month. Instead of buying a house I am seriously considering renting permanently. A 5% cd pays all of my bills and don’t have to worry about any maintenance,water bills,sprinklers Many of my friends miss activities to meet repairmen. I am a retired tradesman and don’t care if I ever pick up a tool again

The issue with a CD paying all of your expenses is good for the moment, I agree. However, its also like a pension, a fixed amount every month. At some point, the inflation of every day expenses will overcome the fixed income amount, and you will need to eat into your principal to pay the increased rent and other living expenses. A few hospital bills which isn't covered can dent the CD and not cover the rent and other living expenses. .

The future is ALWAYS uncertain. What works today will continue to work until it doesn't. so always have a plan B even if today looks like it will continue indefinitely.

[La lamy]

I was going to rent also, but got kicked out of what I thought would be my forever rental in TV. You never know what the owners will do with their property, so owning my own house has been a sense of stability where I'm able to fix whatever I want to my liking. Putting cash into a home is also a way to have to save oneself from paying taxes on interest earned from investing it.

Originally Posted by Villager1234

I think I can survive on my pension and social security. If I can’t I can get a NYC address and get a free EBT card, cell phone, and $1000 for rent

Not if one has a Gold Star driver's license required to fly commercial airlines (May 7, 2025 is the deadline in case one has not heard). Now, if one goes by plane, train or automobile from T V one will be all set to execute that economically beneficial plan.

Renting in T V is fine but is unpredictable in nature for sure. A popular song says it all, "Buy Dirt" (unless one likes paying off someone else's dirt).

[daca55]

Originally Posted by MightyDog

I was crunching numbers on this very thing about a month ago and, in some cases, the OP is right.

Don't have the math paper right in front of me but, as rough example: If you have 250 to 300K in cash that you were going to use to buy a house and instead buy a T-Bill or CD for almost 5% that generates $12,500 annually for the 250k and $15,000 for the 300K.

I've seen monthly rents on many decent homes at $2000 so, 24K per year cost to rent. The rents include: water, sewer, trash, landscaping, pest control, amenity fee, repairs and, of course, property tax. Renter pays for electric, cable and internet....as additional cost.

So, if you add all the items the owner covers (that would be additional cost to you if you plunked down the big cash for a home purchase) it starts to get quite interesting to rent. My final numbers were something like $6000 or $7000 net out-of-pocket on an annual basis to rent currently if you don't require large or fancy digs.

The $12500 and $15000 you mention from income derived from T bills or a CD is not all yours. They are both federally taxed. How much depends on your tax bracket. Just saying……

[Girlcopper]

Originally Posted by villagetinker

I guess I am missing something, but the owner of the rental will eventually need to recoup some (maybe all) of the previously mentioned expenses, by increasing the rent. I am going to watch where this discussion goes.

Im a life long renter and love it. Fridge breaks? Call the owner. Water leak? Yep, call the owner. I would never waste my time maintaining a home when I can live worry free

[Robnlaura]

It’s a great idea at the moment. The housing market is heading into a storm.. listings are rising rapidly prices continue to climb. Yet, not very many are selling. Prices are starting to plummet just look at the time on market figures. I would sit on the sidelines myself to see what actually happens. There’s no fear of not finding a home in the villages not at the at the way they building. This idea that the villages is a bubble never drop will take a massive test this and next year..

[Bradley60]

If you move money from an annuity to a T-bill or CD, do you have to pay taxes on the money when you move it?

[Pat2015]

Originally Posted by JMintzer

"Told" by whom?

50% of all the purchases in the southern areas of TV are not rentals. What’s the basis of your comment?

[R&J in NJ]

Originally Posted by Villager1234

I believe that the rental market is getting more affordable. I am told that almost 50% of new purchases down south are investors. This can cause rents to drop

50%? Sad that the new neighborhoods are so transient. Renters don't care for the homes the same way as full time residents.

[Robojo]

Originally Posted by Stu from NYC

More power to you but what happens to your budget when interest rates go down?

You are locked in until withdrawal with a cd