Adam Ruins Everything – Why Home Ownership is Actually a Terrible Investment


Prepare to be dazzled, ladies. This house just
came on the market. (gasping) Danielle, the energy in here. I can feel it. This is our home. And outdoor spaces
are always in demand. This place is
a great investment. Mm-hmm. No, it isn’t. Crap, competition. Hi. (women gasping) Oh, hello,
are you looking? For a place
to live, yes, but– Come to think of it,
I probably shouldn’t buy. And neither should you. Fact is, a lot of people
who shop for homes would actually be
better of renting. What are you talking about?
I just got a promotion, and Jen’s sound healing
practice just got a customer. Yes, his name is Wolfram. Right, buying a house
is what you do. It’s the American dream. Ah, yes, for almost a century,
Americans have been taught that homeownership is the
ultimate middle class ideal. Oh, Harold, our
very own little castle. Isn’t it grand? Yes, freedom, stability, and no one will know
I’m a queer. Oh! But the fact is
for millions of us, this is a dream
that’s not worth chasing. Please, buying a home
gives you freedom. No, it doesn’t. When you rent, you can
move whenever you want. But after you buy,
you’re sorta stuck. (phone ringing) Ooh, a job that pays more money? In Hawaii? (chain rattling) Sorry, I’m just really
tied down right now. It’s even been shown that higher
rates of homeownership lead to higher unemployment
for exactly this reason. You’re forgetting that owning
a home makes financial sense. I am sick of paying
rent to some landlord. Yeah, instead you’ll be paying
a mortgage to some bank. How is that any different? Well, let’s see, I send you
a bill once a month. I kick you out
if you don’t pay and, ah, I don’t fix anything. That’s the difference. You’re gonna need this
when your heater explodes. And I’m gonna use your can considering I own it
for the next 30 years. (chuckling) Often, buying doesn’t give you
any more stability than renting. You’re just paying
a different jerk. And for the first few years,
you’re not even building equity. You’re just paying off interest.

100 thoughts on “Adam Ruins Everything – Why Home Ownership is Actually a Terrible Investment

  • Buy a house and rent it out then live in your car renting is slavery my mom pays more then I do for a 2br apt compared to my 5br home

  • Sooooooo paying 3k for rent is smarter than $1500 in mortgage? Lol me thinks Adam is someone's puppet which would make sense bc he likes stuff up him!

  • Buying a home in a place you like to live with a 15 year mortgage is the best thing to do. Who's going to be able to pay rent when they're 85?

  • Renting has significant cons as well. You can't just break a lease whenever you feel like it or without penalty, so if you get that sudden job offer, you can't just run off to Hawaii (but, you can actually sell a house with a mortgage on it – you pay the mortgage off at the time of the sale from the proceeds, it is very common). And you have diminished rights, security and privacy because you don't actually own the property. You can get evicted for many more reasons than non-payment of rent and sometimes with very little notice.

  • Buying a house is still better than renting one because

    1) After you pay off your mortgage in like 30 years the entire house is yours. However even if you rent a house for 30 years it still doesn't belong to you. And you will still have to continue to pay rent. So in the financial standpoint you will pay more in the long run for renting a house than owning one.

    2) The value of a property will increase in the long run so that means if you buy a house today and you want to move out then you can sell your house at a profit as the housing market will always go up in the long run. However you cannot profit from this if you are renting one. And not only can you not profit from this rather it will be a disadvantage for you in the rising market because rent tends to go up when the value of the property increases so that means you will have to pay more to live in that house

    3) If you own a house then you can choose rent some of your rooms out. This way the money collected from the rent could easily be used to pay off the banks. However if you rent a house you are not allowed to rent it out to someone else.

  • Well, if you get a better job somewhere else why not rent the house out? I understand the point the video is trying to make but saying renting and financing for home ownership are the same is abit disingenuous

  • I guess there are pros and cons to both but buying a house is a lot more costly than most people think. Interest payments, insurance, maintenance and repairs and also upgrades cost a lot of money.

  • I think that renting is better but this show has a few inaccuracies. When you pay your monthly mortgage you're essentially keeping your money, because when you sell your house you have to pay less to top up the mortgage. You can also leverage your mortgage and use it to buy other things, like more houses. If you move you can just just let a real estate company sell it while you move.

  • Rent liabilities and purchase assets. American dream is a luxury. Let’s put the emotions and pride of ownership aside— a house is a liability because you pay IT every month. If the asset doesn’t pay YOU next month…. it’s a liability.

  • This is something to make those that can't afford a home feel better about themselves. What about equity? What if you actually buy a house and stay in it for years or decades? What if you pay it off? Renting provides you with zero equity. I've known people that rent for 10 years or more and when theg leave they might only get their initial deposit back. What a one sided lazy video.

  • Well here’s my idea but a house then rent when work calls but the time you retire you’ve got your house to live but this works only for the high middle class and wealthy jobs

    Ancestral Homes/rich people – Hold my Pepsi (I’m Muslim.)

  • that's why is best to wait until you have enough money to buy a house upfront instead of getting a mortgage

  • Exactly what I always said!
    If you’re buying a house, you’re doing it for your heirs. That’s pretty much the only difference

  • I will disagree with you on this one. Owning a house is an asset. You just have to do it the right way. The dave ramsey way. If you get a 15 years mortgage loan. You will not have to pay anything after 15 years and you pass it to your children after you die. Whereas you have to pay rent every month for as long as you are staying in the property. Plus rent can be increased. As for moving away for a job you can always rent it out and use that money to pay rent for your new home.

  • The thing about buying is you can decorate and it’s better for family’s because they often move less

  • Actually the buying a property is a good idea but the major mistake most people make is that they buy the biggest house they can find. They waste most of the money paying the interest over 30 years. By the time the house is paid off you could've bought 5 houses.

  • Unless you pay the most cash up front and try to pay your house as quickly as possible it's the best investment you can make. If you need to move sell the house

  • A couple of points: There are few tax advantages to renting. Mortgage interest is deductible, and allows filers to itemize. Yes, you pay mostly interest in the first few years. But adding just a few dollars extra to each mortgage payment will drop the total interest amount radically, as well as shorten the life of the loan. As for being tied down, you could rent out your home should you decide to relocate. You could sell it, turning any profit into another real estate or other investment. If you stick with a fixed-rate mortgage, no one can raise your payment. Try that with rent! Improvements to your home add to your cost-basis. Improvements to your rental add value to the landlord's property. Adam may ruin everything, but he doesn't necessarily know everything.

  • The point isn't that you shouldn't own a home at all or that it doesn't have benefits. The point he makes is against her specific statement of being a good investment. Think more literally like 20,000 dollars in a solid investment portfolio vs using 20000 on a house

  • Homeownership depends on the price of the home and the interest rate. A cheaper home that isn't fixed up but livable at a lower price in a good area builds wealth better than a high price home in an area where its inaccessible. I watched my home go from 145k to 250k in 7 yrs. If you can buy low then do it. If you wait too long it'll be out of reach.

    So finding a house at 120k which is 24k down @20%, 12k @10% or 4.2k at 3.5% is more cost effective than buying a house at 500k. A 500k house is 100k @20%, 50k @10% and 17.5k @3.5%. With the 17.5k @3.5% on a 500k house can be used as a 10% down payment on a 120k home.

  • I feel like this video is just not mentioning a lot of points that are for a home ownership. For example, paying rent is different from paying a morgage, because at the end, you will own the place that you have been paying for (unlike a rented appartement). Plus, during the last couple of years, house prices have been growing and growing and aren't falling yet, if someone bought a house in 2005 (like my parents) they can now sell it for a much higher price. In my opinion, this video is very biased and not well researched.

  • Better than paying your landlord’s bills and funding their vacation plans. But Adam has a point. You only have a few years in between paying off your mortgage and then being forced into a retirement home

  • Except when you buy after the crash…and then sell 5 years later during a boom and make a huge profit! Student loans paid off baby!!! 😁

  • It's better to do a 15 year mortgage. It costs more per month, but intrest rates are lower, and you'll pay it off twice as fast

  • I’m about to close on a house. it really depends on your situation. For me, my mortgage will be around $500 a month. If I where to rent in my town it would be $1000-$1200 + Utilities for the same size/location.

  • You're don't own your home, you're just renting it from the government. And top this with local regulations from local government agencies telling you what you can and cannot do with your property + a bank/lender breathing down your back every month = no thanks. I'll stick with renting.

  • I don’t consider real estate an investment, it’s more of a buy a place to live sort of situation. I wouldn’t care if it results in a profit or anything really

  • Owning your own house is the best! You can renovate and expand when necessary. You can make bold choices and make it your own. Moving around is overrated and will only give you ulcers.

  • but once you pay it off it's yours rent free. also you can sell it and make some of your money back. i have a cousin who moved from toronto to a smaller city in atlantic Canada and got a HUGE house

  • Lease for year to rent before you could decide to move out, constantly waiting months for landlord to fix something simple because fixing it yourself could violate terms, monthly invasion- i mean inspections, additional garage monthly fee, pet deposit and monthly fees, restrictions what you cannot have or do, can be kicked out for any number of reasons other than terms of agreement and monthly rent, nosey and noisy neighbors on the otherside of the wall, two flights of stairs just to get in the apartment, limited parking places, and changing monthly rent; sounds lovely to rent.

  • This is the worst advice I have ever seen. Yes, it's better to rent if your job isn't stable or you know it's short term. Yes, it's better to rent than buy a house you can't really afford but if you put a reasonable amount down, get a mortgage you can afford and take the time to learn the best ways to pay that house off, it is the best investment you will ever make.
    It's not owning that can be a problem, it's the mortgage.
    Many years ago, the banks wouldn't write you a loan that you couldn't afford. If it went bad, they lost too. It was in the bank's best interest to have you make all your payments and eventually pay the loan off.
    Problem is, the government wanted to make it easier for poor people to buy a home. They knew banks were not going to just start loaning money to high risk people so the government created ways for banks to write these risky loans without any risk to the bank. Mainly, they allowed the banks to write a risky loan, get their origination fees etc, and then sell that loan to other investors that get stuck holding the bag if those loans go bad.
    Now you need to educate yourself, you need to make sure you can afford what you are buying.
    Look at the amortization tables and see how much you are paying in interest at the beginning.
    Look at how much you save over the life of the loan if you simply put $100 a month towards principle only. Just paying a little extra on principle only at the start, shifts how much of your payment is interest and how much is going to pay off the principle. An extra $100 a month for the first few years can take years off the term of the loan. A 30 year mortgage becomes 20 years.
    I made a double first payment on my mortgage. One was the normal monthly payment. (mostly just paying interest) The second was a principle only payment and that simple, one time extra payment took 6 yeas off the term of my loan.
    There are lots of little tricks to make your mortgage work for you but you have to have a little extra every month.
    If you buy the max you can afford and are only making the minimum payment, it will be several years before you really benefit at all.
    If you buy something you can afford and pay a little extra, in 8 or 10 years, your mortgage payment is the same, or less than rent would be plus you have equity that builds every month.
    In 15 years, you have tens of thousands in equity and your mortgage is notably less than rent would be. If you paid extra, in 20 years you could have a 30 year mortgage paid off and you are only paying taxes and insurance every month.
    If you are smart about it, home ownership creates tremendous security and benefits.
    If you aren't smart about it, you just end up paying everything you have on a loan you never really get on top of. Adam only presents the bad side. He assumes an uneducated buyer making bad decisions.

  • I disagree. You can do all kind of renovations to a home that you buy but you can’t do much to a home that you rent. So long as you keep up with mortgage payments (or you become rich and buy the house cash), you can do what you want, have people there as long as you want, and flip and sell it if you want.

  • What about the idea that somebody could pay rent into the same house or apartment for decades, and have nothing to show for it?

  • Are you forgetting about renting out homes and fix and flip and appreciation and equity that you can get from making improvements and the market value rising (if you buy in the right area)? ….. and people who want to secure an affordable payment they know wont change for 30 years? The rents here went up 600 dollars a month in the past few years and people are ending up having to move for away from their families and jobs because of it…. this is very bad advice for a lot of people lol

  • When you rent you’re throwing your money away. Buying a house has huge advantages. First it’s typically cheeper, for instance my mortgage is roughly 1300 a month but if I rented my house it would probably rent for about 1600 a month. Owning a home can become a safety blanket. For instance when I bought my house (a fanny mae repo) in 2010 I paid 162,000 for it. It was just assessed at 225,000. After owning it for nine years my pay off is around 95k. That means there 130k in usable equality. That can be borrowed against, used to put into the house to make it worth more or held onto incase of emergencies. Adams oversimplification is ridiculous and poorly portrayed.

  • Still, after you pay your bills to the bank you will have a house, that you can sell at any time (even if you are still paying for it) and that’s something no landlord can give you. I understand most people can’t afford to buy a house but if you can there is no reason not to. There are people who live of buying houses and selling them for more, houses increase value so every year you are paying for it you are also winning more money for the future. And not moving because you have a house it’s just crazy, sell the house pay the bank and move. Maybe I feel differently about this because I live in Brazil but here buying a house even if it’s to rent later it’s a great investment, one that many people can’t do and that’s the sad part.

  • well if you buy your own house, you can rent out extra rooms. or rent out through airbnb. good luck doing that legally when you rent. as well you can probably generate additional money through various means. this video is super biased.

  • When you are renting, you’re not only paying the mortgage, but also taxes and whatever upkeep is on the house. You may think you’re not, but how else do you expect a landlord to make any money off of his investment if you’re not covering the costs plus making him some extra?

  • I would rather own a home than rent, the contracts and stuff aren't for me. My ideal place would be a home not part of an HOA and in a rural area.

  • Since when does landlords fix anything? If your heater blow up for exemple it's either your responsability to fix it (because the landlord never will) or it's coming straight out of your security deposit.

  • Actually, the viability of home ownership depends on where you live.

    If you live in a place with awesome transportation, you don't really need to move, such as Singapore, Japan, and a large chunk of Europe.

    If you live in a place with shitty transportation (like the US, especially in the west) then it is more viable to move unless you live in a city.

    Futhermore, ownership of a house will allow you to renovate your house however you like, as there is no landlord to boss you on what you can place in the house.

  • 2 lesbians, a guy who wants to hide the fact that he is queer and the black woman is successful and got a promotion while the white woman is an unsuccessful idiot. WEW LAD

  • ok but what if u lost ur job. what happens if u have to pay rent??? also, most landlords have strict rules. no pets, no loud niose, if its furnished u cant ruin it, sometimes u cant evenn recolor your house. buying a house is a great investment, since aswe all have seen, houses prices go up most of the time.

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