Rent? Or Buy? The New York Times weighs in (with fancy graphics!)

My opinion remains: If you want a ‘piece of the rock,’ something to call your own, something that will improve your quality of life and enhance your financial one, then homeownership IS a wonderful undertaking at any time during any kind of market. Real Estate section features an article today providing statistical proof that it’s better to rent than own. I’d suggest you read the article, but you must then read the comments thread linked to in the sidebar.

There you will find a refreshing clarity expressed by consumer-comrades-in-arms. (Me, I’m just an industry insider with a “vested interest” in promoting homeownership!)

Here’s what I wrote as my contribution to the comments thread:

“I’ve participated in this conversation over and over again on the Craigslist Housing Forum. The posts above are typical of the distinct split in opinions.

I think Mr. Leonhardt’s article captures the essence of those differences, but skews too much to the recent ‘craze’ for real estate and the negative side effects of that way of thinking.

I’m one of those mortgage professionals with a ‘vested interest.’ I’ve been helping people buy homes since 1989, so I’ve seen all kinds of markets, interest rates, and heard thousands of different opinions from people as to why they buy homes. That having been said, I think it’s always a good time to buy a home. Always.

I work in the NY Metro region, and many of my clients come from the same background as I do: hardworking New Yorkers tired of paying rent, fighting for parking spots, listening to noisy neighbors, or arguing with irresponsible landlords to repair leaky faucets.

My take on homebuying is based on the intangible benefits of homeownership: the long term investment in yourself and your family, and the financial benefits (beyond tax deductions) derived from the homeownership experience.

I grew up in an apartment building in Queens. As a young man I rented. I hated it. I was determined to someday own a home. I taught myself about real estate back when there was no internet, no first time buyer programs, and the MLS was a telephone-book sized list without photographs.

I remember being laughed out of a real estate office by the broker. Then, I found my way into the mortgage business quite by accident during the recession of the late 80’s. Five years later, I bought my first home in that same neighborhood and had the last laugh.

I would never say Landlords are evil, or assume that fellow tenants are self-centered, noisy, dirty, and insensitive to their neighbors’ quality of life, but I’ve lived in rental apartments. There’re numbers on a page—as indicated in the article—comparing costs/benefits of renting vs. buying, and there is reality.

If you determine that your quality of life will improve—and I think by extension, so will your financial life, in the long run—when you own a home, then it’s the right thing to do.

If you happen to have great neighbors and responsible landlords, if the cost benefits are more favorable, and you can discipline yourself to actually invest that money you’re saving by renting, then that’s the right thing to do, too.

For my part, I’ve never advocated the ridiculous notion that buying a home is an investment in the short term sense indicated in the article, and promoted by the NAR economists. (For the cynical reader, a quick google of my name will provide you with evidence of what I say, and what I don’t say)

If some Realtors want to market their business that way, so be it. Car companies advertise cars driving slalom-style at high speed on scenic country backroads. That doesn’t mean the average person drives that way.

I refuse to participate in such nonsense and I’ve walked away from client referrals who come to me chittering about how they want to make an investment in buying properties.

I’ve always looked to owning a home as something you do for the long term: at least 7-10 years (which used to be the average for American families until this ridiculous ‘boom’ market came along). That’s why I’ve always advised my clients to get 30yr fixed rate mortgages, not 15’s, not ARM’s, and certainly not those other insane mortgage products that are now wreaking such havoc among American homeowners.

If you want a ‘piece of the rock,’ something to call your own, something that will improve your quality of life and enhance your financial one, then homeownership IS a wonderful undertaking at any time during any kind of market.