Home sale then why buy again; rent vs buy?

[Rdy2Fire]

Curious on the MMM thoughts.

Currently own in a HCOL and High Tax state/area and plan to sell my home. I should net around 600K+ when I sell.

I know there is always a lot of rent vs buy questions. When I was younger owning a home was the/my 'American Dream' but with upkeep/maintenance, taxes, increased costs etc thinking no reason to own another home. Is there a good reasoning people would think it makes more sense to buy again?

With 600k, even paying $2500 a month for living expenses (rent/utilities) that is equal (with $0 gain) to 240 months or 20 years. Side notes, I don't know where I would move/live. FLA make sense for tax reasons, also considering various places outside the US.

Just interested in some debate/opinions/general thoughts and a sanity or insanity check (maybe no one thinks along my lines)

[fell-like-rain]

Well, there's the financial side and the emotional side. Financially, you generally come out ahead in the long term (10+ years) with buying, and in the short term with renting. But this can vary a lot based on the price/rent ratio in your individual area. Emotionally, it's a mixed bag. Buying feels more stable to me, but as you mentioned, there's also the burden of upkeep and maintenance. Renting does have its downsides, though, if you end up with a do-nothing landlord or a rotating cast of unruly neighbors.

It sounds like you do not know where you want to live long-term, which to me sounds like renting is a much better idea. Why not plop down in a new area for a year or so and see how you like it there?

Also, for the financial break-even calculation: https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

[Dee_the_third]

Just you? No family? How flexible is your job?

If you like home ownership and are flexible, move to a lower COL living area. 600k is substantial, it should get you most of the way to FI. You're buying the rest of your life.

(A plug for the midwest: totally underrated region imo. Plenty of left-enough, shockingly bike friendly college towns.)

If you're tied to the region, you could split the difference and buy a condo. Ownership and stability, but less maintenance. And less appreciation of course.

[Rdy2Fire]

It sounds like you do not know where you want to live long-term, which to me sounds like renting is a much better idea. Why not plop down in a new area for a year or so and see how you like it there?

Also, for the financial break-even calculation: https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html

You're right, I don't know and that is what I am thinking i.e.  " plop down in a new area for a year or so and see how you like it there" 

As for the calculations I've done those a few times but as you said I guess maybe it's more emotional. 

Just you? No family? How flexible is your job?

If you like home ownership and are flexible, move to a lower COL living area. 600k is substantial, it should get you most of the way to FI. You're buying the rest of your life.

(A plug for the midwest: totally underrated region imo. Plenty of left-enough, shockingly bike friendly college towns.)

If you're tied to the region, you could split the difference and buy a condo. Ownership and stability, but less maintenance. And less appreciation of course.

Just me, FIRE'd (no job) and appreciate the plug but like the coasts a bit more. I have thought about the condo or townhouse type of thing as well but ultimately it's still picking a place and owning. As the previous comment hit on, just not sure where I'd want to be.

Thank you both (and anyone else) for the responses to my insanity 

[Rdy2Fire]

LOL! I did another rent vs buy calc

[WanderLucky]

I think it just depends on your lifestyle and goals. For me personally, I like the feeling of having a "home base" - a place I can make my own with whatever paint colors or style I want, store things that give me comfort (art, records, books, furniture, nice cookware, etc.), and most importantly for me, a place where I can have dogs and occasionally foster them. The downsides of renting for me are rising rents, not a lot of control over my space, and a fear of the place eventually selling.
That said, I also like change, so my plan is to rent out my house for 6-8 months a year while I bounce around spending 1-3 months in different short-term rentals. And then going back to my home base. I've done this in the past and I loved it.
Since you don't know where you want to be, you could do something similar (1-3 months in multiple places) until you figure it out.

[Paper Chaser]

There can be a big difference in expenses between owning in a HCOL/High tax location and owning in a LCOL/Low tax location. Most of the negative aspects of ownership that you list are related to high expenses. All of them go down in a LCOL/Low tax location, which might alter your feelings about ownership. "Ugh, home ownership is costing me tons of money!" can become "This is a very manageable expense within my FIRE budget!" just by switching locations.

I like the stability of owning vs renting for FIRE situations. Housing is often the largest line item in most people's budgets, so I really prioritize controlling that cost as much as possible. Having a fairly steady mortgage makes planning future cash flow needs easier than trying to predict rent increases (which can increase hundreds of dollars per month in some places with very little warning).

Since you don't know where you'll end up, renting is the obvious winner right now regardless of the cost of living or taxes. Once you figure out where you want to be, then you can dive deeper into what makes sense for the area and the lifestyle you want to live. Want to live on the beach, but can't afford to own there? Then rent. Want your own woodworking shop, art studio or kickboxing gym? Then own. Love the freedom of being able to try new places? Then rent. Love having a place that's uniquely yours? Then own. All of those come after finding the right general location.

[Rdy2Fire]

There can be a big difference in expenses between owning in a HCOL/High tax location and owning in a LCOL/Low tax location.

All of those come after finding the right general location.

Thank you and WanderLucky for your input. I totally agree with both your assessments/thoughts especially the above.

No question i believe I need to sell HCOL in the next year or so and figure it out from there. I enjoy reading/hearing others perspectives for sure and I do understand peoples needs for a 'home base' vs being some kind of nomad. Guess I am trying to figure out a good mix

[nessness]

In your situation, not being tied to a specific place, I would definitely rent for a year and then reevaluate. Even if you definitively settle on a metro area, you might find you'd prefer a different area (city vs. suburbs, closer to public transportation, closer to hobbies, etc.), and it's a lot easier to pick up move when you're renting.

[Villanelle]

We currently rent due to frequent moves.  But we will own again once we are more settled.  The reasons for that are somewhat financial (a somewhat fixed cost, other than property taxes, helps with planning).  But mostly, they are non-financial, yet still thing we value enough to pay for, even if they end up costing us more money overall than renting would have.  Things like being about to customize a home and make it work as ideally as possible for us are important, as are being able to change it aesthetically.  But most importantly, I don't want anyone else being able to tell me that I need to move in 60 days because they are selling the place I'm renting. Or having a 20% rental increase in a crazy market.  The stability of not having to leave unless it is our choice and on our terms and timing, is huuuge and I see that as a benefit well worth spending more for, compared to renting, if that is how it ends up happening. 


We also don't know where we will end up, or if our next location will be our forever location, or a medium-term location.  We wouldn't buy unless we expect to be somewhere at least 5 years.