[E9T.two]

Most people will tell you to buy a house. Good idea, if that's what you want and what will make you happy. At the end of the day, you gotta make sure that you're financially solid and that your money is working for you. A house can be just as expensive and disposable income eating as a car... depends on the situation.

I drive an E92 M3 right now... I could have gotten a newer car, but I have a wife and three kids that depend on me... compromise. I still have a ton of fun and love every moment. It satisfies my need to be in the car game, but doesn't break the bank (until it needs service)... me and my kids have a blast ripping through the canyons in Malibu on the weekends. "Smiles per Gallon" as they say. It's literally the only thing that's "mine" LOL.

The reality is that we live in LA, 35 years old, are currently renters, but saving for that family home we dream of. It will take a couple more years of being on a budget and disciplined saving, but I don't feel like I'm missing out on the "newest thing". I don't care about that. I care about being balanced and happy.

Short answer, do what you think is right for you, man. Life is too short to be unhappy.

[Likeanowl]

I’m torn here. I’d say buy a house first and be smart but I wouldn’t be taking my own advice then.... I bought my first bmw, a black 335i when I was 24. Paid in cash so I had no payments. My theory behind this was while under warranty I’d owe literally nothing on the car and be able to keep saving towards a house. More money in my pocket to invest and save at the end of each month. 2 years later I traded it for a 2016 340i with some extra cash down and continued to stock pile money away for a house. When I was 28 (2018) I bought my first house, put a ton of money down (~60%) so my monthly would be as low as possible. This allowed me to then buy a slightly used f80 by July of 2019. In hind sight I wish I had bought the house first and car later but I gotta admit, being 24 with a brand new bimmer fresh off the lot made a lot of my friends jealous . If you have to pick one or the other though I definitely say house. Always a better investment over a car.

[-Vanguard-]

Originally Posted by ShiftingG82

Good Morning from NY. I've been thinking about this since I saw the G82 in person.

I would like to know how many others who are pulling the trigger on a G8x M3/M4 are still renting an apartment. I really want a G82 but I'm tired of renting and want a home for myself where I could park my cars inside my own garage. If I pull the trigger on the G82 I won't be able to buy a house for another five years which doesn't really bother me that much, but it will be on the back of my mind especially since I don't have a garage near my current location so I'll end up parking the car on the street.

I know the car is going to lose value everyday I drive it, while a house might stay the same or go up in value in most cases. But, I'm a car guy, I love cars, I do most of my mechanic work myself, and LOVE high speed, shifting my own gears, and car technology. I've had numerous days where work was horrible, but the minute I turn on my car I forget about everything and just pay attention to the operating temperature of the car before I hammer it! Sadly, when I come home from a horrible day at work I don't admire my apartment. I just want my bed and start a new day the next day.

I just want to know how irrational or rational my thoughts are and whether I'm the only one that's going through this. If you were in a similar boat in the past can you tell me what you ended up going with and how things are now?

Brother...if you can't afford the car while affording your mortgage and saving money you should NOT be buying that car yet. It's not the right time. You should not be buying a 60k+ car when you don't have a investment account, a retirement account, property or enough money saved to buy it cash.

Nice things are nice, but they are not worth going into financial ruin for. You are 32, its your prime investing and money saving years. Don't blow them on a car.

Cars are a liability while home are an asset. In my honest opinion, unless you are bringing home a minimum of 10K a month AFTER taxes, you really should never be driving a car that's 1K a month in payments. A mortgage in NY is at least 3.5k (600,000 "starter" home in this shit state) a month, taxes another 1K a month, food 1K a month, thats 5.5K. Add bills, utilities, cell phone, going out with the wife/gf, comfortable impulse buys here and there like PC parts, games, tech...whatever its probably another 1.5K a month. Thats 7k total. Now lets say you want to invest your max 401K which is 19500 a year, thats about 1.6k a month. That's 8.6K gone, leaving with you 1.4K. Invest $400 in a personal investment account. Leaves with you $1000 every month to save or spend on car. Now where's the money for the car payment if you make less? It doesn't exist.

This is assuming you want to be a responsible and actualized adult in your 30's and are making 10K NET which means around 15K before taxes.

Delaying a home purchase 5 years for a fucking car is idiotic. Please don't do this. Drive a civic for 5 years, but get a house under your name. In the end- cars all do the same thing. Point A to point B. Our extensive car market is because we live in a spend driven society. In my opinion, car manufacturers should not be able to change car designed every 2-3 years like many do. It's a schemey way to make people buy the shiny new things.

Once you OWN your, you will admire it. You will spend time upgrading it, fixing it, just like you do with your car. Trips to Lowe's, Home Depot, Bed Bath will actually be exciting because you are adding to your home. I know it sounds boring, but its not, it gets fun.

I digress.

CAR= LIABILITY
HOUSE= ASSET

This should not be up for consideration.

[Jcali86]

Ignore the boomer above. These are the last few years of cars like this. Buy it and love it. Buying a house and having kids is so last century. Live your life, you could die of a virus next month for all you know! I will say one thing they have completely right though and I 100% agree; don't buy this car without having a savings account, retirement account etc etc. A mortgage doesn't matter though yet.

[snareman]

Short version - it's irrational. Buy the house.

Is the OP still even here reading this? He has 9 posts and nothing in a month. Maybe we are all just speaking to posterity.

[Gdiddy23]

I own several homes but have recently decided to rent a brand new townhouse w a 2 car garage. Guess it was the best compromise at the time. Housing market out here is bat shit.

I rent my properties out and use that additional $ to fund my (expensive) car hobby. Renting just seemed to be the best scenario for us right now until we figure out next moves.

[Baylorguy]

Create a thread like this and you will definitely get a million different opinions. The best thing that has worked for me is to see what folks do on either extreme... I have mentors that do nothing but save despite making 200K+ a year in Texas (that is bank due to lower cost of living in Texas) and they do not enjoy things like cars, etc. I also know many, many people that live way beyond their means... at one point I was in this group, and it is not a fun place to be.

Having looked at both extremes, I then try to ask myself what seems responsible for me, and being that I have 3 kids, how can I enjoy my toys but also be responsible. Maybe that means getting an RS3 vs. M3. Maybe it means something like a Golf R. Point is, you likely know in your gut what is right, so don't let other people influence you to the point where they tell you what you want to hear. Make the most informed decision you can and stick with it. If you make a mistake, you are young, learn from it and do better next time. This is not an ultimatum where it is game over if you make the "wrong" decision... learn from mistakes, or good decisions, and move on.

For what it is worth, I have owned a house but I am in a rental now because my wife and I are building a new one. I don't have an M3, but I do have a stage 2 E85 RS3, which is probably one of the most epic sleepers around right now. Ask the many exotic cars I have shamed

-Phil

[2011ninja]

Originally Posted by Likeanowl

I’m torn here. I’d say buy a house first and be smart but I wouldn’t be taking my own advice then.... I bought my first bmw, a black 335i when I was 24. Paid in cash so I had no payments. My theory behind this was while under warranty I’d owe literally nothing on the car and be able to keep saving towards a house. More money in my pocket to invest and save at the end of each month. 2 years later I traded it for a 2016 340i with some extra cash down and continued to stock pile money away for a house. When I was 28 (2018) I bought my first house, put a ton of money down (~60%) so my monthly would be as low as possible. This allowed me to then buy a slightly used f80 by July of 2019. In hind sight I wish I had bought the house first and car later but I gotta admit, being 24 with a brand new bimmer fresh off the lot made a lot of my friends jealous . If you have to pick one or the other though I definitely say house. Always a better investment over a car.

Jealous only if they wanted a new BMW 3 series.

My buddy thought he was hot Crap
328i
535i
X5

He does not know crap about cars so they were all headaches. He now drives a Hyundai and loves the car.

He would always try and brag to me about them. I did not want to hurt his feelings because I'm not a fan of pedestrian BMWS or BMW in general just the M3.

[Transfer]

Originally Posted by Jcali86

Ignore the boomer above. These are the last few years of cars like this. Buy it and love it. Buying a house and having kids is so last century. Live your life, you could die of a virus next month for all you know! I will say one thing they have completely right though and I 100% agree; don't buy this car without having a savings account, retirement account etc etc. A mortgage doesn't matter though yet.

My 2.875% 30 year mortgage and market value increase of 18% over last 3 years would argue against you. It's a great way to grow wealth, instead of losing 40% value of a major purchase over 3 years.

[VetteGuy]

Originally Posted by Jcali86

Ignore the boomer above. These are the last few years of cars like this. Buy it and love it. Buying a house and having kids is so last century. Live your life, you could die of a virus next month for all you know! I will say one thing they have completely right though and I 100% agree; don't buy this car without having a savings account, retirement account etc etc. A mortgage doesn't matter though yet.

And make sure you double down on those retirement savings because with that plan you’ll be paying rent until the end of your retirement.

[Jcali86]

Originally Posted by Transfer

My 2.875% 30 year mortgage and market value increase of 18% over last 3 years would argue against you. It's a great way to grow wealth, instead of losing 40% value of a major purchase over 3 years.

It's not wealth until you sell it, and you who do you plan to sell it to? Millennials with student debts and stagnant wages or gen z who will no doubt have zero interest in owning an old house? Good luck with that. I'll buy somewhere eventually just to do what I want with it. My money is growing elsewhere just fine.

[wtwo3]

Originally Posted by Jcali86

It's not wealth until you sell it, and you who do you plan to sell it to? Millennials with student debts and stagnant wages or gen z who will no doubt have zero interest in owning an old house? Good luck with that. I'll buy somewhere eventually just to do what I want with it. My money is growing elsewhere just fine.

Millenials need a place to live too right? Either you sell them a house, or you rent it out to them. Either way, you're leveraging an asset.

[JPM-3]

Originally Posted by Jcali86

It's not wealth until you sell it, and you who do you plan to sell it to?

Chinese investors



Probably

[TaylorBlake]

I built my own tiny house, and I can confidently tell you that it is the best investment of my life. The first reason to buy or build a small house is quite obvious, because a small house is much cheaper than a huge mansion, and therefore more affordable. If you are interested here https://www.boutiquehomeplans.com/the-process, you can calculate the house according to your abilities.

So, when making a choice, think sensibly and soberly to assess your capabilities. In most cases, a mortgage loan is considered the best solution to the lack of money, and the small size of the new house will reduce the loan amount and pay off the bank faster.

[M4Ghost]

I rent…

[NightWriter]

If I pull the trigger on the G82 I won't be able to buy a house for another five years

Looks like there's already some sensible advice in this thread, but +1 for the fatherly feedback: Pursuing your passion(s) in life is a good thing, but it should not come at the expense of long-term financial health. If you have a steady job/career and will likely be staying put (geographically) for the foreseeable future, almost any financial advisor will tell you that the priority should be on building equity in your home, rather than flushing money on a (rapidly) depreciating asset like a car.

Sounds like you enjoy wrenching and are a card-carrying member of #savethemanuals. Glad to have you on board, but I suggest picking up some used stick in the $25k range, find a home (and soon, before interest rates go up), and then reevaluate in a couple of years. You'll be glad you did.

[modat]

When I graduated from college 14 years ago my first job was mid 6 figures.

Bought a new sports car every year and partied like a rock star. I enjoyed it but I regret it to this day. I threw away so much money.

While I'm in a good financial position now, I cringe at the thought of how how money I lost. My buddy ended up buying a house instead of cars and he just sold it for 400k more than what he bought it for plus his equity.

[MunkyTool]

Buying a house first will always be the right answer, all things considered equal.

But at the end of the day you have to do what's right for your life situation.

[jmg]

Originally Posted by Jcali86

It's not wealth until you sell it, and you who do you plan to sell it to? Millennials with student debts and stagnant wages or gen z who will no doubt have zero interest in owning an old house? Good luck with that. I'll buy somewhere eventually just to do what I want with it. My money is growing elsewhere just fine.

If market value is largely determined by recent sales of comparable properties in the area then someone's buying them.

[GoldfishTX]

I am a renter. I've never lived any place more than a couple of years, and I'm not going to drop millions to buy a house where I am now. Don't let an internet forum drive your investment advice.

[Transfer]

I'm not giving anyone advice, but I'll update my situation. Bought first house 2010 and sold it at 100% increase in value 2018. Current house now up 60% in 3.5 years and expected to increase at least 20% in the next year. So yeah I'm glad I scraped together every dime I had to make that first purchase and I bought in a winning market. Owned a VW Rabbit at the time. At least the 5 cylinder sounded good.

[Salespunk]

Originally Posted by Transfer

My 2.875% 30 year mortgage and market value increase of 18% over last 3 years would argue against you. It's a great way to grow wealth, instead of losing 40% value of a major purchase over 3 years.

Now do the math on what your down payment plus the reduced cost of rent vs buy would be at over the last three years. On average real estate has returned 3% and the stock market 8%. The last three years have seen a major market distortion due to population redistribution based on WFH and the pandemic.

My point is that there is no right or wrong answer. If you are financially irresponsible then buy the house. Why? Because it is forced savings. If you are financially responsible then buying is not that important. Here is the math breakdown on the home I owned for 15 years;

Purchase Price $1.4M
Down payment/moving costs $200K
Landscaping/pool $200K
Monthly overage cost vs rent ~$2K
Sales Price after 15 years $1.8M

Doing the math on the opportunity cost;
Net present value of $400K invested in SPY $803K
NPV of $2K/mo at 8% return $54K

You can see that there is basically zero difference between buying and renting in this real world scenario. In fact renting would have been slightly advantageous and the purchase costs are WAY over simplified. We put solar on the house for an additional $50K plus repairs over time, etc.

I am not saying that buying a home is a bad idea. In many cases is makes sense for more reasons than just financial. It is just not the simple decision that people make it out to be either. Like someone else above, we own several properties, but currently rent our primary residence.

The reason many advisors say to buy a home is because people basically suck at saving money. For the average person their primary residence becomes their sole real asset when saving for retirement.