Ponderable

P o
Bruddah IZ said:
The banks been getting you for at least 20 years according to your imaginary portfolio.
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I know man, the bank really got me.
Want to buy my house?
It’s about $4m but wait I owe the bank over 500K of that because they loaned me money when I bought it for 880K. ! I’ve been using their money for 20 years at less than 5% while my money has grown by well over 5%. And they get none of the rise in asset value.
And I have lived in this expensive house for 20 years...think how much it would have cost to rent!
Yeah the bank took such advantage of me. I got in the house for less than 200K to start.
 
messy said:
P o

I know man, the bank really got me.
Want to buy my house?
It’s about $4m but wait I owe the bank over 500K of that because they loaned me money when I bought it for 880K. ! I’ve been using their money for 20 years at less than 5% while my money has grown by well over 5%. And they get none of the rise in asset value.
And I have lived in this expensive house for 20 years...think how much it would have cost to rent!
Yeah the bank took such advantage of me. I got in the house for less than 200K to start.
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Of course you did. Lol! Still no net income to speak of.
 
Bruddah IZ said:
Of course you did. Lol! Still no net income to speak of.
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My income (I mentioned my income taxes, right?) comes from my day job. Even at 7 figures annually, you don’t get rich that way. Real estate creates wealth. Got to get in the market. On the other hand, I did some r.e. financing last year and even though my bank only makes 3.15% from my home mortgage (a shitty return), I got about a 13% annualized return on helping finance a couple of houses in Pasadena. That was very good. If you knew how any of this worked, which you don’t, you’d agree with me. You’re not totally stupid, you just need to humble yourself (a lot) and start small.
 
messy said:
My income (I mentioned my income taxes, right?) comes from my day job. Even at 7 figures annually, you don’t get rich that way. Real estate creates wealth. Got to get in the market. On the other hand, I did some r.e. financing last year and even though my bank only makes 3.15% from my home mortgage (a shitty return), I got about a 13% annualized return on helping finance a couple of houses in Pasadena. That was very good. If you knew how any of this worked, which you don’t, you’d agree with me. You’re not totally stupid, you just need to humble yourself (a lot) and start small.
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You pay the bank monthly for your house. Is that how it works? Lol!
 
Bruddah IZ said:
You pay the bank monthly for your house. Is that how it works? Lol!
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That’s how people buy real estate. For only 20% down, they get in a house that, if you buy in the right location, increases in value. The history of that, in Los Angeles where I live, is insanely great. Think about it. You buy 100% of the gain and you start with only 20% of the cost. Most mortgages are not only at an interest rate less than you make on your capital that you didn’t use to pay for the house, but the interest rate is deductible. Nothing like it! You make more sitting and living in your house for a few years than you do at your job! Well, your job, anyway...
So as I said, lose your fear, decide you know less than you think you do, and jump in. I’m telling you, San Pedro is gonna pop next. Get in for 750 (ie 150 down) and in 3-4 years, if Trump doesn’t totally tank us the way the last Republican president did, get out for 1.1. How much will those monthly payments be? $3500 or so? Live in it or rent it, same difference right?
 
messy said:
That’s how people buy real estate. For only 20% down, they get in a house that, if you buy in the right location, increases in value. The history of that, in Los Angeles where I live, is insanely great. Think about it. You buy 100% of the gain and you start with only 20% of the cost. Most mortgages are not only at an interest rate less than you make on your capital that you didn’t use to pay for the house, but the interest rate is deductible. Nothing like it! You make more sitting and living in your house for a few years than you do at your job! Well, your job, anyway...
So as I said, lose your fear, decide you know less than you think you do, and jump in. I’m telling you, San Pedro is gonna pop next. Get in for 750 (ie 150 down) and in 3-4 years, if Trump doesn’t totally tank us the way the last Republican president did, get out for 1.1. How much will those monthly payments be? $3500 or so? Live in it or rent it, same difference right?
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A 20% down payment is just you buying 20% of equity that you can use to put yourself in debt more. I can tell you've never analyzed your amortization schedule. For example, your loan, 840k at 3.15%, your first payment hits you with a 60% interest payment. You're not down to 3.15% until your 349th month. Again 3rd grade math facts. Living in it or renting it is completely different. If you're renting you actually have an asset. Live in it, you actually have a liability that generates no income from the property nor the equity.
 
Bruddah IZ said:
A 20% down payment is just you buying 20% of equity that you can use to put yourself in debt more. I can tell you've never analyzed your amortization schedule. For example, your loan, 840k at 3.15%, your first payment hits you with a 60% interest payment. You're not down to 3.15% until your 349th month. Again 3rd grade math facts. Living in it or renting it is completely different. If you're renting you actually have an asset. Live in it, you actually have a liability that generates no income from the property nor the equity.
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You should re-read my post and buy that house in San Pedro. Trust me, young’un...you won’t make more money doing anything else you do. And I don’t know how much you currently pays for rent, but if you live in it, your “income” is the savings on rent that you would be paying elsewhere. Ya see how that works? And of course the interest that you’re paying is deductible, another huge benefit to purchasing real estate vs other forms of assets.
 
messy said:
You should re-read my post and buy that house in San Pedro. Trust me, young’un...you won’t make more money doing anything else you do. And I don’t know how much you currently pays for rent, but if you live in it, your “income” is the savings on rent that you would be paying elsewhere. Ya see how that works? And of course the interest that you’re paying is deductible, another huge benefit to purchasing real estate vs other forms of assets.
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I marked this post as "Informative" as hopefully dizzy can use it as a first step in his education.
 
messy said:
P o

I know man, the bank really got me.
Want to buy my house?
It’s about $4m but wait I owe the bank over 500K of that because they loaned me money when I bought it for 880K. ! I’ve been using their money for 20 years at less than 5% while my money has grown by well over 5%. And they get none of the rise in asset value.
And I have lived in this expensive house for 20 years...think how much it would have cost to rent!
Yeah the bank took such advantage of me. I got in the house for less than 200K to start.
Click to expand...
2 Corinthians 11:30
If I must boast, I will boast of the things that show my weakness.
 
messy said:
You should re-read my post and buy that house in San Pedro. Trust me, young’un...you won’t make more money doing anything else you do. And I don’t know how much you currently pays for rent, but if you live in it, your “income” is the savings on rent that you would be paying elsewhere. Ya see how that works? And of course the interest that you’re paying is deductible, another huge benefit to purchasing real estate vs other forms of assets.
Click to expand...
Whether you rent or pay a mortgage, neither generates the income required of a real asset. Even with your deductions. Your simulated rental might.
 
Bruddah IZ said:
Whether you rent or pay a mortgage, neither generates the income required of a real asset. Even with your deductions. Your simulated rental might.
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You can make up another word for this huge asset, sounds like you insist on it. And the sky is yellow.
Few things bring wealth like buying real estate.
And I don’t know what you mean by “simulated rental.” Didn’t I tell you earlier you need to keep it simple? If you are living in a place, you are either paying rent or paying off a mortgage. So in doing all your overwrought math, you should count your rent savings as income, because you’re living in the house and not paying rent somewhere else.
 
messy said:
You can make up another word for this huge asset, sounds like you insist on it. And the sky is yellow.
Few things bring wealth like buying real estate.
And I don’t know what you mean by “simulated rental.” Didn’t I tell you earlier you need to keep it simple? If you are living in a place, you are either paying rent or paying off a mortgage. So in doing all your overwrought math, you should count your rent savings as income, because you’re living in the house and not paying rent somewhere else.
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Rent and Mortgages cashflow away from the occupants to either the bank or the rental owner and then to the bank. That's why you have no net income from the home that you live in. Few things do bring wealth like real estate. Especially when that real estate is generating income. Your home is not doing that.
 
Bruddah IZ said:
Rent and Mortgages cashflow away from the occupants to either the bank or the rental owner and then to the bank. That's why you have no net income from the home that you live in. Few things do bring wealth like real estate. Especially when that real estate is generating income. Your home is not doing that.
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I gave you one example. I have more.
In 2012 I bought a house for 969. In 2016 I sold that house, without any improvements, for 1.7.
My first house, in 1987, was $211K in the Hollywood Hills. I lived in it without improvements and sold it in 1991 for $335K.
Do the 3rd grade math and explain which investments you have made that beat those.
You can also use my existing primary residence, the stats on which I have given you 3 separate times.
Get in the market, son. Own a home.
Why are you paying your landlord’s mortgage instead of your own?
 
messy said:
I gave you one example. I have more.
In 2012 I bought a house for 969. In 2016 I sold that house, without any improvements, for 1.7.
My first house, in 1987, was $211K in the Hollywood Hills. I lived in it without improvements and sold it in 1991 for $335K.
Do the 3rd grade math and explain which investments you have made that beat those.
You can also use my existing primary residence, the stats on which I have given you 3 separate times.
Get in the market, son. Own a home.
Why are you paying your landlord’s mortgage instead of your own?
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A-ha moment! If you were the land lord in all three examples you now have net income, thanks to your renter, and thus an asset. My work here is done.
 
Bruddah IZ said:
A-ha moment! If you were the land lord in all three examples you now have net income, thanks to your renter, and thus an asset. My work here is done.
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You’re looking at the wrong side of things.
Unless you live in a shelter or with your parents, you’re either the tenant or the owner. Don’t be a sucker, be the owner.
I’m always the owner. My rent goes to me! Then I sell for a big profit.
I don’t think it sinks in with you.
 
messy said:
You’re looking at the wrong side of things.
Unless you live in a shelter or with your parents, you’re either the tenant or the owner. Don’t be a sucker, be the owner.
I’m always the owner. My rent goes to me! Then I sell for a big profit.
I don’t think it sinks in with you.
Click to expand...
Profit yes, asset no.
 
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