My mortgage has decreased from 5.25% to 2.25% in the past 20 years.
It’s weird how so many things seem to be geared to help people who don’t need the most help (although I appreciate it). Locking in a mortgage and not having to move is one of the best things to square up a financial situation.
Especially hard on friends who rented for 20 years who have been saving to buy but hurt by increasing rents over and over.
Rent to buy is a good strategy because you can justify to yourself living in a crappier place than you would want to own outright. Over time that allows you to purchase a house at a lower total outlay, including the rent you paid. During that saving period you also had the additional hard to quantify benefit of being able to move quickly and cheaply.
If you are doing rent to buy but living in frothy areas where rents are always rising and apartments rent for 4k then obviously it's not going to be a winning strategy for you.
Every area is frothy. You live where you have to live to work where you can find work. The assumption of this saving period is also fairly strong. It only makes sense if you're earning $60k a year or more, and actually can afford to spend less than a third of your income on rent.
It’s weird how so many things seem to be geared to help people who don’t need the most help (although I appreciate it). Locking in a mortgage and not having to move is one of the best things to square up a financial situation.
Especially hard on friends who rented for 20 years who have been saving to buy but hurt by increasing rents over and over.