Cohousing-L Mailing List: Re: affordable housing [was: Cohousing-L Digest...

[Fred-List manager (fholson]

Ron Ingram <ingramr88 [at] gmail.com>
is the author of the message below.  It was posted by
Fred, the Cohousing-L list manager <fholson [at] cohousing.org>

Ron's reply was to a digest that slipped by my screen for
excessive quoting. I deleted quoted digest and restored
subject line.  Fred


--------------------  FORWARDED MESSAGE FOLLOWS --------------------

Does anyone think there will ever be universal rent equity. For example,
let's say I have a real estate portfolio with several apartment buildings
and homes that I rent to tenants, each rental payment they make goes toward
a certain percentage of profit share. So instead of just paying rent, you
are actually investing, helping the portfolio owner to buy more properies
to which you also financially profit. You can change and move apartments
within the portfolio to maintain your percentage of profit share or equity
share. I know these words are not interchangeable and I may not be using
them correctly. But hopefully someone gets the picture. When you exit the
portfolio altogether......still fleshing this out but assuming you can
transfer or sell your share or....if the portfolio also has homes, you
could use your equity in the portfolio rentals as the downpayment on a
mortgaged home.

This will help those who are cash strappped both afford current rent  and
build up the rental equity for a downpayment on a home. If this were a
thing, many people would gladly rent and help take care of their rentals
because they too are invested at a higher level.

Thought about this for awhile. If I added up all the rent, deposits, admin
fees etc I could have money for several downpayments on a nice home on my
budget, even at the low end of paying $500/mo for 10 years.

Ron



On Sun, Jan 5, 2020, 9:02 AM Ty Albright via Cohousing-L <
cohousing-l [at] cohousing.org> wrote:

> The reason home ownership (vs renting) results in equity over time - is the
> forced payment of mortgage amortization and re-investment in maintenance
> over time (your house becomes an equity sink / savings over time).  Yes -
> there is value appreciation (not always) - but this works only if you stay
> put long term (real estate transactions are expensive and eat up "profit")
> and DO NOT fall to the temptation of getting a 2nd lien "home equity loan"
> based on your home appreciated value over time.
>
> If you did the math in detail - based only on numbers - it will show that
> you should own your house because you like your house and want a nice place
> to live - not because its an "investment".  Renting provides flexibility -
> ownership can provide entrapment.
>
> This based on my 40+ years' experience in real estate.
>
> Ty
>
> Ty Albright Project Management
> Little Red Hen LLC
> 214-336-7952
> tmalbright [at] verizon.net
> www.linkedin.com/in/tmalbright