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Thank you, thank you. I am so sick and tired of hearing about all the taxes you will save by buying a home. In the 20 years I was paying off a mortgage I was only able to itemize twice (both times due to extreme medical expenses such as: 1981 hospital stay was $82,000 of which 80% was covered by insurance)

People just do not seem to realize that the taxes you save are just a relatively small percentage of the money you spent. One of the worst examples I have seen was back in the days when all interest was deductible and one of my employees returned from her financial advisor, Bank of America trust officer, all atwitter about all the tax money she will save next year by mortgaging her house (with B of A), running up her B of A credit card, and getting a loan on her car (from, guess who). I got out the US and Cal tax forms and showed her how much she would be spending on interest compared to her tax savings but... A bank officer certainly knows more than her supervisor. Four years later she died of a heart attack and Bank of America ended up with the house because the kids couldn't pay off the loan.

Rental property is an investment. One should NOT consider a home as an investment unless you have bought a multi-family dwelling. If you make money or break even when you sell your home consider it a windfall. I have seen my former home go from $9k (1956) to $250k (1989) to $160k (1998)and it is in better shape in 98 than when we bought it for $22k in 1967. Obviously, the 3 families who had this particular home from 56 thru 89 did much better than the 4 families from 89 thru 98 (one of which lost it to the bank)

If you can ignore the very strong emotional facet of buying a house and try and look at it on purely financial grounds consider what you would be paying in rent for a home ($3k month?) then subtract: property tax ($300 month?), additional insurance costs, maintenance ($2k year? if you can do most of the work yourself). IF you can get a mortgage payment less than your final figure you are pretty much guaranteed to win.

One big drawback to buying vs renting: if you end up with rotten neighbors you can't just move. You have to tough it out until you can sell (or until I leave)

One big advantage to buying vs renting: landlord can't raise your rent by 30% just because the area vacancy rate is under 5%.

Disclosure: my family has been *land poor* since gramps left Prussia (sorry, Poland) in the late 1800s to be a dry farmer in S.Dak. and it has carried on thru my daughter who, I think, has lost money on each house she has bought because she puts too much in them in upgrades.
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