Home Ownership and Wealth Building

[official2008]

official - what are you doing in the UK?

RBG: working...for some international law firms


HBCU: hell yeah i'm sincere, please explain it to me how i'm wrong. 

[HBCU.EDU]

No. I don't feel like it. Also, I'm not smart enough to defend my view. I just like to reject topics without backing it up with anything. My girl will get you though. She is smart. She graduated from a PWI. .

official - what are you doing in the UK?

RBG: working...for some international law firms


HBCU: hell yeah i'm sincere, please explain it to me how i'm wrong. 

[blk_reign]

So you’d rather pay rent when you can own a home? Seriously.. why pay a white man (or anyone for that matter) 1k or more a month for rent when you can pay a lender 1k a month for a home that you own? And God who puts down 30% or more for a home loan if they don’t have that money to spend? You better believe that that person has horrible credit and will have a higher risk of foreclosure… no loan officer (unless it’s a predatory lender) is going to come to you and tell you that you need to put 30% down into a home unless your credit score is under 580 or you have no credit at all…then you’ll have a high risk loan.. which in all probability with be a 3/2 arm mortgage that you’d refinance after 3 yrs… just so you know.. a lender is NOT going to allow a person to put 60% of their income into a home loan.. that’s just ridiculous..

And to be quite honest.. I’m tired of seeing my brothas and sistas rolling around in these expensive ass cars without a garage that they own to put it in..

see here’s where your statement is flawed.. the more money that a person puts into a loan the more equity they’re building.. meaning that’s more money that can be cashed out for a re-finance.. that’s wealth building right there.. a Home is an investment and the possibilities are endless once you buy… I’m not putting my money into “fiscal power, stocks, bonds” etc if I don’t own a home.. that’s silly.. as wishy-washy as the market is.. there are no guarantees unless you’re in a locked rate…

Money is power.. the reason that we have no power as a black community is because so many of us are broke… it’s just that simple.. the people that hold the keys are the same people with money.. it’s one thing to sit down and talk about doing something but without the money to do so it’s nothing more than a conversation…

You’re saying all of these things against “making money” yet you’re choosing one of the most glamorous professions in American society… I’m sure it isn’t just to save the world and feed the hungry people.. there are other ways that are a lot cheaper than taking out loans for a JD..matter of fact.. since we’re having this conversation about wealth- why take out a $60- $140k loan for an education that will NOT guarantee you a job once you graduate??? Hell don’t go law school keep doing what you’re doing to get ahead…


There are many other ways   that you can  help people without all of the glam and glory of a JD.. americorp  or teaching for example..but I digress.

Let me jump in on this one.

I have to disagree on the whole American dream/buy a house theory. I’m against buying homes to “build wealth,” as far as helping black people goes. I think the discussion so far has been talking about the wrong type of wealth, (i.e. monetary) which doesn’t necessarily follow from buying a home btw.

We should be trying to build political capital rather than anything fiscal. You see, people always think that money is power, but it’s just the opposite, power is money (you have to understand the linguistic properties of identity to understand that the statement I just made isn’t the same), but let me explain what I’m saying. It doesn’t matter where you live, or if you own that residence or not, what matters is how you live. Being stuck under a burdensome mortgage for 20-30+ years is not the way to go.  However, owning a solid stock portfolio is, having the mobility to get up and leave a particular political district or economy is as well. 

Just think if black people instead of putting 30 to sometimes 60/80% of their income into buying a house were to invest that money into something that helps us all. Like black businesses, black banks…Africa!

Of course there are exceptions, but buying a home is so secondary.

[official2008]

No. I don't feel like it. Also, I'm not smart enough to defend my view. I just like to reject topics without baacking it up with anything.

official - what are you doing in the UK?

RBG: working...for some international law firms


HBCU: hell yeah i'm sincere, please explain it to me how i'm wrong. 

that's what i thought.


but i'll argue my self on this one...





counterpoint: but tim, home ownership is great, for the following four reasons. people can pass the wealth down from generation to generation. it's all about the equity, it's basically like your saving your money instead of throwing ot away on rent, and you can take a loan out based on it. why pay rent when you could be spending the same money to buy a home...that's yours. and lastly, the home may appreciate, in which case you make a profit. top that!

[HBCU.EDU]

See. I told you. She is better than me. 

[Statistic]

why did you use your government name, official?

[blk_reign]

u are silly.. Mr stock brokerman.. i think you should add your two cents..

See. I told you. She is better than me. 

[_BP_]

See. I told you. She is better than me. 

good post Blk_Reign, I was about to put together a post myself, but it's no longer needed.

[_BP_]

orright I couldn't help it, real quick:

Plus, if you want to make a comparison between home ownership and financial instrument ownership (stocks-bonds), you can.  Home ownership is really a highly leveraged investment, where one can take control of an asset worth, for example, 250K for an initial investment of 5K.  It's really the equivalent of issuing a collateralized callable bond (with the call being the option to prepay, and the collateral being the home itself).
<HBCU will appreciate this>
Not to make this too involved, but basically home ownership is no different from a strategic financial investment in the strictest form ( a la stock/bond investing).

[official2008]

I prefer my government name RBG.


Official: listen man, just as homes appreciate they can depreciate, you can lose money too, ESPECIALLY if you don't know what you're doing. so that equity you built...gone. bottom line, i mortgage is a burden! why take on the stress, why live in one place for so long? why pay the interest, the maintenance fees?

rent! there are better things, more reliable things to put your money into. again, how you live is way more important than where you live...nobody cares if you own or rent. an example-- a hypothetical if you will.

scenario one: everyone owns their house, great. but that's it. they pay (to be fair 25% of their income on it) however, they're stuck... in a deteriorating home...under a stressful loan...in that city...in that school district...with those neighbours...with that obligation...with the maintenance costs...for 30-something years...basically, between a rock and a hard place.


scenario two: people rent, from the white man even. they pay 30% of their income on rent. yet they're free from the homeowners burdens. they have options. their quality of life is a bit better... and for that i say they're wealthy(er).

so, it all comes down to two things:

1. opportunity costs; like i said before, you have to ask yourself are the troubles and heartache that come with homeownership or rather buying a home... that you can't afford to buy upfront worth the benefits of renting that you give up?

2. political capital that amasses from putting your money in better-suited, more fruitful places. your child and their children will benefit more from a black bank, or, God forbid, real black communal wealth than they would with a house or piece of real estate.



Black: you'd be surprised what percentages of a person's income they pay on their mortgages. i

i didn’t elect to become a lawyer for its prestige, i feel i'll have a bigger voice if i'm an esquire than i would otherwise