Private school but rent?

[Anonymous]

A lot of the benefit of buying is non-financial. In some instances it’s just a different product not available on rental market. Can’t really rent on Park or 5th. Co-op rules create a better environment - people who actually live there as their primary home, some element of screening, strong community where you know your neighbors. Obviously, there are dysfunctional co-ops too but the good ones are worth it.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

We rent in a family friendly building on UES. Lots of people know each other, people have been here 10 plus years.

While that might be true, I know plenty of people who regret not buying (especially outside of Manhattan). Since the 90’s the wealth gap continues to grow due to the inflationary environment we live in. Real estate is one of the few investment vehicles you are allowed to be over leverage and have the debt depreciate over time due to inflation and tax deductions in mortgage interest payments.

It’s pretty obvious you’re kind of screwed if you’re in your 40s in Manhattan with kids and still renting.

It’s not like it’s cheap to rent in NY. Many families paying $10-12k a month to rent a decent apartment. Even if you make a million a year, by the time you pay nannies, 2 in private school, taxes, retirement accounts etc there isn’t much leftover.

Our friends still renting say it’s a better deal but when they move out, all they get back is a security deposit. When I move out, I’ll get a check for over a million dollars. I highly doubt they’ve saved that much more renting that it makes up for a levered investment.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

It’s this for most people. You end up with a lot of equity over decades and you eventually have a mortgage payment that seems less and less over time.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

We rent in a family friendly building on UES. Lots of people know each other, people have been here 10 plus years.

While that might be true, I know plenty of people who regret not buying (especially outside of Manhattan). Since the 90’s the wealth gap continues to grow due to the inflationary environment we live in. Real estate is one of the few investment vehicles you are allowed to be over leverage and have the debt depreciate over time due to inflation and tax deductions in mortgage interest payments.

It’s pretty obvious you’re kind of screwed if you’re in your 40s in Manhattan with kids and still renting.

It’s not like it’s cheap to rent in NY. Many families paying $10-12k a month to rent a decent apartment. Even if you make a million a year, by the time you pay nannies, 2 in private school, taxes, retirement accounts etc there isn’t much leftover.

Our friends still renting say it’s a better deal but when they move out, all they get back is a security deposit. When I move out, I’ll get a check for over a million dollars. I highly doubt they’ve saved that much more renting that it makes up for a levered investment.

For us, renting a $15k apartment is about 3 percent of our annual net income and worth the flexibility. Also in our 40s with 2 kids at independent schools. You get better returns on S&P.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

We rent in a family friendly building on UES. Lots of people know each other, people have been here 10 plus years.

While that might be true, I know plenty of people who regret not buying (especially outside of Manhattan). Since the 90’s the wealth gap continues to grow due to the inflationary environment we live in. Real estate is one of the few investment vehicles you are allowed to be over leverage and have the debt depreciate over time due to inflation and tax deductions in mortgage interest payments.

It’s pretty obvious you’re kind of screwed if you’re in your 40s in Manhattan with kids and still renting.

It’s not like it’s cheap to rent in NY. Many families paying $10-12k a month to rent a decent apartment. Even if you make a million a year, by the time you pay nannies, 2 in private school, taxes, retirement accounts etc there isn’t much leftover.

Our friends still renting say it’s a better deal but when they move out, all they get back is a security deposit. When I move out, I’ll get a check for over a million dollars. I highly doubt they’ve saved that much more renting that it makes up for a levered investment.

For us, renting a $15k apartment is about 3 percent of our annual net income and worth the flexibility. Also in our 40s with 2 kids at independent schools. You get better returns on S&P.

Life must be pretty amazing, right? I'm being totally serious, not snarky. I've been working for 30 years and don't make 6 figures, I can't imagine having your income. I understand why you rent!

[Anonymous]

Anonymous wrote:A lot of the benefit of buying is non-financial. In some instances it’s just a different product not available on rental market. Can’t really rent on Park or 5th. Co-op rules create a better environment - people who actually live there as their primary home, some element of screening, strong community where you know your neighbors. Obviously, there are dysfunctional co-ops too but the good ones are worth it.

This. Buying is a consumption and lifestyle decision. Buying in Manhattan hasn’t been a good financial decision for over a decade and your property won’t keep up with inflation. It doesn’t matter if it’s a townhouse, coop, or condo. If you’re looking at areas flush with luxury rentals, you’re a fool to buy thinking it’s an investment.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

We rent in a family friendly building on UES. Lots of people know each other, people have been here 10 plus years.

While that might be true, I know plenty of people who regret not buying (especially outside of Manhattan). Since the 90’s the wealth gap continues to grow due to the inflationary environment we live in. Real estate is one of the few investment vehicles you are allowed to be over leverage and have the debt depreciate over time due to inflation and tax deductions in mortgage interest payments.

It’s pretty obvious you’re kind of screwed if you’re in your 40s in Manhattan with kids and still renting.

It’s not like it’s cheap to rent in NY. Many families paying $10-12k a month to rent a decent apartment. Even if you make a million a year, by the time you pay nannies, 2 in private school, taxes, retirement accounts etc there isn’t much leftover.

Our friends still renting say it’s a better deal but when they move out, all they get back is a security deposit. When I move out, I’ll get a check for over a million dollars. I highly doubt they’ve saved that much more renting that it makes up for a levered investment.

For us, renting a $15k apartment is about 3 percent of our annual net income and worth the flexibility. Also in our 40s with 2 kids at independent schools. You get better returns on S&P.

If you make $5 million, then sure. But really why deal with a rental building and not the stability of a coop?

[Anonymous]

Anonymous wrote:

Anonymous wrote:A lot of the benefit of buying is non-financial. In some instances it’s just a different product not available on rental market. Can’t really rent on Park or 5th. Co-op rules create a better environment - people who actually live there as their primary home, some element of screening, strong community where you know your neighbors. Obviously, there are dysfunctional co-ops too but the good ones are worth it.

This. Buying is a consumption and lifestyle decision. Buying in Manhattan hasn’t been a good financial decision for over a decade and your property won’t keep up with inflation. It doesn’t matter if it’s a townhouse, coop, or condo. If you’re looking at areas flush with luxury rentals, you’re a fool to buy thinking it’s an investment.

Except buying can lock in housing costs.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A lot of the benefit of buying is non-financial. In some instances it’s just a different product not available on rental market. Can’t really rent on Park or 5th. Co-op rules create a better environment - people who actually live there as their primary home, some element of screening, strong community where you know your neighbors. Obviously, there are dysfunctional co-ops too but the good ones are worth it.

This. Buying is a consumption and lifestyle decision. Buying in Manhattan hasn’t been a good financial decision for over a decade and your property won’t keep up with inflation. It doesn’t matter if it’s a townhouse, coop, or condo. If you’re looking at areas flush with luxury rentals, you’re a fool to buy thinking it’s an investment.

Except buying can lock in housing costs.

Not in NYC. You have monthly maintenance and insurance. Monthlies have outpaced inflation by a good deal and this went on pre COVID. Health insurance, doorman unions, and deferred capex have gotten out of hand. If you want predictable property taxes then move to a state that limits annnual increases.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The rent v buy calculus is so skewed towards renting that you shouldn’t buy unless it’s a niche housing type you can’t rent (e.g. prewar park avenue coop). Don’t let a perception of negative stigma push you into buying a condo or coop that won’t appreciate at the rate of inflation and with monthlies that will eat you alive should your circumstances change.

Except then you have to rent in retirement and rent goes up every year. You also have to live in a rental building.

If you’re using a rent/buy calculator you’re not wealthy enough to send kids to privates in Manhattan. A nanny is also more expensive than daycare, and NY private school parents aren’t using daycare.

Many UHNW individuals use rent buy calculators. You don’t become a centimillionaire by being reckless financially. Even without the calculator, they intuit the cost benefit.

And you know what else goes up in retirement in NYC? Coop monthlies. And insurance. And repair costs. And that equity you have tied up isn’t beating the S&P or a multifamily property long term. There are plenty of neighborhood and property types in NY where buying never beats renting, even on an infinity timescale

I’m not convinced the renters are investing in the s&p instead of buying. Anecdotally, a lot of families I know spend the entirety of their earnings on baby nurses, private schools, vacations, summer rentals, taxes etc. Whenever they catch up they have another kid and add a nanny.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

We rent in a family friendly building on UES. Lots of people know each other, people have been here 10 plus years.

While that might be true, I know plenty of people who regret not buying (especially outside of Manhattan). Since the 90’s the wealth gap continues to grow due to the inflationary environment we live in. Real estate is one of the few investment vehicles you are allowed to be over leverage and have the debt depreciate over time due to inflation and tax deductions in mortgage interest payments.

It’s pretty obvious you’re kind of screwed if you’re in your 40s in Manhattan with kids and still renting.

It’s not like it’s cheap to rent in NY. Many families paying $10-12k a month to rent a decent apartment. Even if you make a million a year, by the time you pay nannies, 2 in private school, taxes, retirement accounts etc there isn’t much leftover.

Our friends still renting say it’s a better deal but when they move out, all they get back is a security deposit. When I move out, I’ll get a check for over a million dollars. I highly doubt they’ve saved that much more renting that it makes up for a levered investment.

For us, renting a $15k apartment is about 3 percent of our annual net income and worth the flexibility. Also in our 40s with 2 kids at independent schools. You get better returns on S&P.

How much are you actually saving out of your $5 million salary though? At least a million a year?

I know a few families in the $2-3 million range who rent and spend every penny. If you’re in the NY scene you can spend $200k alone on private clubs. It goes fast.

I do think there are wealthy individuals in Manhattan who rent but big spenders are way more common

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A lot of the benefit of buying is non-financial. In some instances it’s just a different product not available on rental market. Can’t really rent on Park or 5th. Co-op rules create a better environment - people who actually live there as their primary home, some element of screening, strong community where you know your neighbors. Obviously, there are dysfunctional co-ops too but the good ones are worth it.

This. Buying is a consumption and lifestyle decision. Buying in Manhattan hasn’t been a good financial decision for over a decade and your property won’t keep up with inflation. It doesn’t matter if it’s a townhouse, coop, or condo. If you’re looking at areas flush with luxury rentals, you’re a fool to buy thinking it’s an investment.

Except buying can lock in housing costs.

Not in NYC. You have monthly maintenance and insurance. Monthlies have outpaced inflation by a good deal and this went on pre COVID. Health insurance, doorman unions, and deferred capex have gotten out of hand. If you want predictable property taxes then move to a state that limits annnual increases.

Strongly disagree. Rent increases are often very large in NY. Property taxes and maintenance is still just a % of your overall payment. Once you’re 10-15 years into ownership your housing expense should start to seem like a great deal. It’s how people stay in the city long term. If you only view it short term, then sure.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A lot of the benefit of buying is non-financial. In some instances it’s just a different product not available on rental market. Can’t really rent on Park or 5th. Co-op rules create a better environment - people who actually live there as their primary home, some element of screening, strong community where you know your neighbors. Obviously, there are dysfunctional co-ops too but the good ones are worth it.

This. Buying is a consumption and lifestyle decision. Buying in Manhattan hasn’t been a good financial decision for over a decade and your property won’t keep up with inflation. It doesn’t matter if it’s a townhouse, coop, or condo. If you’re looking at areas flush with luxury rentals, you’re a fool to buy thinking it’s an investment.

Except buying can lock in housing costs.

Not in NYC. You have monthly maintenance and insurance. Monthlies have outpaced inflation by a good deal and this went on pre COVID. Health insurance, doorman unions, and deferred capex have gotten out of hand. If you want predictable property taxes then move to a state that limits annnual increases.

1-3 family houses have preferential property tax and you have control over maintenance. Many civil servants are millionaires in the outer borough.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Renting has been more beneficial for so many years now. We sold three properties to become renters. Should have never bought them.

Owning can be beneficial. The outer borough and suburbs have appreciated over time. It forces people with bad spending habits to save.


In addition, the math isn’t straightforward. If are wealthy enough to own a place that can host and impress guest with the view (increase networking opportunity), privacy / security of knowing everyone in the building, etc…

We rent in a family friendly building on UES. Lots of people know each other, people have been here 10 plus years.

While that might be true, I know plenty of people who regret not buying (especially outside of Manhattan). Since the 90’s the wealth gap continues to grow due to the inflationary environment we live in. Real estate is one of the few investment vehicles you are allowed to be over leverage and have the debt depreciate over time due to inflation and tax deductions in mortgage interest payments.

It’s pretty obvious you’re kind of screwed if you’re in your 40s in Manhattan with kids and still renting.

It’s not like it’s cheap to rent in NY. Many families paying $10-12k a month to rent a decent apartment. Even if you make a million a year, by the time you pay nannies, 2 in private school, taxes, retirement accounts etc there isn’t much leftover.

Our friends still renting say it’s a better deal but when they move out, all they get back is a security deposit. When I move out, I’ll get a check for over a million dollars. I highly doubt they’ve saved that much more renting that it makes up for a levered investment.

lots of co-ops have had minimal price appreciation in the last decade.

Getting a similar apartment to a 10k rental costs a ton more, probably like 15-18k a month. So even if you bought a decade ago, you are barely ahead by buying and that doesn't include the return on the downpayment.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The rent v buy calculus is so skewed towards renting that you shouldn’t buy unless it’s a niche housing type you can’t rent (e.g. prewar park avenue coop). Don’t let a perception of negative stigma push you into buying a condo or coop that won’t appreciate at the rate of inflation and with monthlies that will eat you alive should your circumstances change.

Except then you have to rent in retirement and rent goes up every year. You also have to live in a rental building.

If you’re using a rent/buy calculator you’re not wealthy enough to send kids to privates in Manhattan. A nanny is also more expensive than daycare, and NY private school parents aren’t using daycare.

Many UHNW individuals use rent buy calculators. You don’t become a centimillionaire by being reckless financially. Even without the calculator, they intuit the cost benefit.

And you know what else goes up in retirement in NYC? Coop monthlies. And insurance. And repair costs. And that equity you have tied up isn’t beating the S&P or a multifamily property long term. There are plenty of neighborhood and property types in NY where buying never beats renting, even on an infinity timescale

I’m not convinced the renters are investing in the s&p instead of buying. Anecdotally, a lot of families I know spend the entirety of their earnings on baby nurses, private schools, vacations, summer rentals, taxes etc. Whenever they catch up they have another kid and add a nanny.

you need to talk to other types of families.