I have a friend buy a foreclosure at a steep discount with a low interest rate.
Not worth paying rent on an apartment / townhouse / villa.
Not worth paying rent on an apartment / townhouse / villa.
Reducing Rent Payment by Buying a House?
- Thread starter john_pifer
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Why are you renting a 2br when you are single? You live in a gated community, have multiple toys in your garage [signature], and had to owe CC money due to dental work.
You say you have no debt, which is great, but it sounds like you have no savings and simply spend what you make.
I apologize in advance if I'm off-base, just going on what you provided in your OP.
If you want to buy a house, you should be saving for a down payment and not spending $1100 a month to rent a larger place than you need. If you had a carport and only fit one of those toys instead of filling up a garage worth, you'd have enough cash for a down payment right now.
You need to get your spending and budget in control before you buy a house.
$.02 - sorry buy you asked for it
You say you have no debt, which is great, but it sounds like you have no savings and simply spend what you make.
I apologize in advance if I'm off-base, just going on what you provided in your OP.
If you want to buy a house, you should be saving for a down payment and not spending $1100 a month to rent a larger place than you need. If you had a carport and only fit one of those toys instead of filling up a garage worth, you'd have enough cash for a down payment right now.
You need to get your spending and budget in control before you buy a house.
$.02 - sorry buy you asked for it
If you had to use a credit card for dental work, you really haven't saved up enough for a done payment or other initial expenses.
Start going to open houses in areas you would live. Find out from family, friends, and coworkers all the costs and lessons learned owning. Be wary of those who only get paid if you buy a home: realtors, lenders, current owners, etc.
For your first home, try to find a mentor to help. Can be family or someone impartial you can trust. In our rural area, the government housing office runs educational programs for prospective first time buyers.
Buy with the idea that you will want to sell it someday. Schools, community, and neighborhood need to be considered. That cabaret around the corner might look good now, but come time to sell, it won't be a plus.
You can do it. It can be an excellent move. The more you know going in, the better chance it will be a plus.
For your first home, try to find a mentor to help. Can be family or someone impartial you can trust. In our rural area, the government housing office runs educational programs for prospective first time buyers.
Buy with the idea that you will want to sell it someday. Schools, community, and neighborhood need to be considered. That cabaret around the corner might look good now, but come time to sell, it won't be a plus.
You can do it. It can be an excellent move. The more you know going in, the better chance it will be a plus.
Buy less house than you can afford. Do not let the bank/realtor talk you into buy as much as you can afford, this is foolish and benefits them, not you. Unexpected repairs come up. Roofs ,Paint, AC/HEAT, Water heaters etc, these usually happen at the same time your cars transmission goes out. If you cannot afford some of these repairs with your house payment, you can't afford the home. Make sure you can afford the home while still putting money in a 401k/403 account.
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Originally Posted By: zzyzzx
If you had to use a credit card for dental work, you really haven't saved up enough for a done payment or other initial expenses.
This. Plus, you don't need a house. Is it a good time to buy a house? I'd say yes. The fact remains that you don't need one.
I'd save (including retirement savings) and be Ready to move when the time is right.
If you had to use a credit card for dental work, you really haven't saved up enough for a done payment or other initial expenses.
This. Plus, you don't need a house. Is it a good time to buy a house? I'd say yes. The fact remains that you don't need one.
I'd save (including retirement savings) and be Ready to move when the time is right.
Try to buy a 15 year loan and keep it at the current rent $1100.
A $150,000 home with a $30,000 down payment would run you about $1,000 / month. If you don't have the $30,000 then payment probably approaches $1,200 with PMI.
Do some research and see what you can get in the 100-150,000 range and if you have a down payment you will be better long term.
Buy what other people want so you can sell it if you want. My first house was a hard sell as it was good for me and any other single guy but not a family home that would have appealed to many. Homes I buy now I make good money on as don't look for the best deal. Usually there is a reason why it is a good deal - low cost because there is something not appealing - area, schools, crime, etc.
A $150,000 home with a $30,000 down payment would run you about $1,000 / month. If you don't have the $30,000 then payment probably approaches $1,200 with PMI.
Do some research and see what you can get in the 100-150,000 range and if you have a down payment you will be better long term.
Buy what other people want so you can sell it if you want. My first house was a hard sell as it was good for me and any other single guy but not a family home that would have appealed to many. Homes I buy now I make good money on as don't look for the best deal. Usually there is a reason why it is a good deal - low cost because there is something not appealing - area, schools, crime, etc.
Both owning and renting have advantages. If I were single, I would save at least 10% of my market value for a down payment. PMI is pretty expensive these days.
Owning costs more and it used to be a no brainer. Now, property values don't necessarily go up, there's PMI (and it's deduction may end in 2014) and other "waste" money you pay out monthly, and you're pretty "stuck" in that location for awhile. Owning is not always the best financial decision these days.
Owning costs more and it used to be a no brainer. Now, property values don't necessarily go up, there's PMI (and it's deduction may end in 2014) and other "waste" money you pay out monthly, and you're pretty "stuck" in that location for awhile. Owning is not always the best financial decision these days.
Renting at $1,100 per month is probably close to what your average monthly home ownership cost would be once you factor in what others have said, the incidental repairs of home ownership. Sure, you get a lower 'payment' when owning, but you have to pay closing costs up front on the note, PMI if you don't have the 20% down payment, real estate taxes and ALL repairs. Factor the 'hidden' costs in and I almost guarantee owning is as expensive if not more than renting.
Owning a home looks good and sounds good until you do a TRUE cost benefit analysis. Owning a home is never going to be cheaper, unless you get the rare deal (foreclosure, massive value increase, etc...).
As stated above, $1,100 in rent probably barely covers the landlords TRUE cost of ownership.
(Good luck cash flowing a rental unless it is a multi-family structure.)
Owning a home looks good and sounds good until you do a TRUE cost benefit analysis. Owning a home is never going to be cheaper, unless you get the rare deal (foreclosure, massive value increase, etc...).
As stated above, $1,100 in rent probably barely covers the landlords TRUE cost of ownership.
(Good luck cash flowing a rental unless it is a multi-family structure.)
Buy now while interest rates are still bottomed out. They are NOT going to get any lower.
Originally Posted By: surfstar
Why are you renting a 2br when you are single? You live in a gated community, have multiple toys in your garage [signature], and had to owe CC money due to dental work.
You say you have no debt, which is great, but it sounds like you have no savings and simply spend what you make.
I apologize in advance if I'm off-base, just going on what you provided in your OP.
If you want to buy a house, you should be saving for a down payment and not spending $1100 a month to rent a larger place than you need. If you had a carport and only fit one of those toys instead of filling up a garage worth, you'd have enough cash for a down payment right now.
You need to get your spending and budget in control before you buy a house. Says him & wife can't buy a house.
$.02 - sorry buy you asked for it
OT: I've met folks that drive a BMW, Lexus or Benz and live in an apartment but always complain they can't afford a house. I know a guy paying $500 lease on Benz, has a company car and they live in an $1200 apartment.
I told him apartment rent + leased Benz = House.
Why are you renting a 2br when you are single? You live in a gated community, have multiple toys in your garage [signature], and had to owe CC money due to dental work.
You say you have no debt, which is great, but it sounds like you have no savings and simply spend what you make.
I apologize in advance if I'm off-base, just going on what you provided in your OP.
If you want to buy a house, you should be saving for a down payment and not spending $1100 a month to rent a larger place than you need. If you had a carport and only fit one of those toys instead of filling up a garage worth, you'd have enough cash for a down payment right now.
You need to get your spending and budget in control before you buy a house. Says him & wife can't buy a house.
$.02 - sorry buy you asked for it
OT: I've met folks that drive a BMW, Lexus or Benz and live in an apartment but always complain they can't afford a house. I know a guy paying $500 lease on Benz, has a company car and they live in an $1200 apartment.
I told him apartment rent + leased Benz = House.
Originally Posted By: 04SE
Renting at $1,100 per month is probably close to what your average monthly home ownership cost would be once you factor in what others have said, the incidental repairs of home ownership. Sure, you get a lower 'payment' when owning, but you have to pay closing costs up front on the note, PMI if you don't have the 20% down payment, real estate taxes and ALL repairs. Factor the 'hidden' costs in and I almost guarantee owning is as expensive if not more than renting.
Owning a home looks good and sounds good until you do a TRUE cost benefit analysis. Owning a home is never going to be cheaper, unless you get the rare deal (foreclosure, massive value increase, etc...).
As stated above, $1,100 in rent probably barely covers the landlords TRUE cost of ownership.
(Good luck cash flowing a rental unless it is a multi-family structure.)
You're not factoring in everything in your "TRUE cost benefit analysis." After 15-30 years of paying the landlord you have absolutely nothing. Every dime of every check you wrote is gone. And then you have to keep paying. When you're finished paying the bank you have a large asset worth tens to hundreds of thousands of $$. Hardly a level playing field unless you only think about the very short term.
Renting at $1,100 per month is probably close to what your average monthly home ownership cost would be once you factor in what others have said, the incidental repairs of home ownership. Sure, you get a lower 'payment' when owning, but you have to pay closing costs up front on the note, PMI if you don't have the 20% down payment, real estate taxes and ALL repairs. Factor the 'hidden' costs in and I almost guarantee owning is as expensive if not more than renting.
Owning a home looks good and sounds good until you do a TRUE cost benefit analysis. Owning a home is never going to be cheaper, unless you get the rare deal (foreclosure, massive value increase, etc...).
As stated above, $1,100 in rent probably barely covers the landlords TRUE cost of ownership.
(Good luck cash flowing a rental unless it is a multi-family structure.)
You're not factoring in everything in your "TRUE cost benefit analysis." After 15-30 years of paying the landlord you have absolutely nothing. Every dime of every check you wrote is gone. And then you have to keep paying. When you're finished paying the bank you have a large asset worth tens to hundreds of thousands of $$. Hardly a level playing field unless you only think about the very short term.
$1100 X 12 months = $13,200
$13,200 X 15 years = $198,000
Of course he can afford a house with $20,000 down
$13,200 X 15 years = $198,000
Of course he can afford a house with $20,000 down
Originally Posted By: LT4 Vette
$1100 X 12 months = $13,200
$13,200 X 15 years = $198,000
In our case, $13K a year was just the property taxes alone. That was on top of mortgage. Granted, probably slightly bigger house than what the OP is considering. It's just that all the smaller houses we saw were [censored].
Hopefully Nasvhille taxes aren't as bad.
$1100 X 12 months = $13,200
$13,200 X 15 years = $198,000
In our case, $13K a year was just the property taxes alone. That was on top of mortgage. Granted, probably slightly bigger house than what the OP is considering. It's just that all the smaller houses we saw were [censored].
Hopefully Nasvhille taxes aren't as bad.
Originally Posted By: john_pifer
would be awesome if I could move at that time and cut what I'm paying per month for housing significantly!
IMO, this is somewhat unrealistic, if you're talking about any decent home in decent shape.
After you factor in mortgage, property taxes, landscaping/maintenance/repairs, you will be paying more than $1,100/month. Alas, you'll be building equity and not just paying the landlord.
For starters, go on zillow.com and check out info on homes in your area or the area that you are interested in. While not exact, it'll give you a general idea of what it would cost you to finance a home, as well as what you can expect to pay in taxes.
would be awesome if I could move at that time and cut what I'm paying per month for housing significantly!
IMO, this is somewhat unrealistic, if you're talking about any decent home in decent shape.
After you factor in mortgage, property taxes, landscaping/maintenance/repairs, you will be paying more than $1,100/month. Alas, you'll be building equity and not just paying the landlord.
For starters, go on zillow.com and check out info on homes in your area or the area that you are interested in. While not exact, it'll give you a general idea of what it would cost you to finance a home, as well as what you can expect to pay in taxes.
If I were in your shoes (single, no kids, and planning to stay in the area) I would not hesitate to invest in a duplex and live in one side.
Let the other side pay most or all of the mortgage, and you're close enough to keep an eye on your rental property. When you are ready to get married, if you and your spouse want a single family home you should have saved enough for a significant down payment. Or you can sell the duplex and use the equity and gains for your downpayment.
Let the other side pay most or all of the mortgage, and you're close enough to keep an eye on your rental property. When you are ready to get married, if you and your spouse want a single family home you should have saved enough for a significant down payment. Or you can sell the duplex and use the equity and gains for your downpayment.
Originally Posted By: Win
get rid of the motorcycles.
Why get rid of the motorcycles?
I have a house and two motorcycles.
There doesn't seem to be any reason why he should have to give up his bikes, since they are already paid for.
BC.
get rid of the motorcycles.
Why get rid of the motorcycles?
I have a house and two motorcycles.
There doesn't seem to be any reason why he should have to give up his bikes, since they are already paid for.
BC.
Originally Posted By: Bladecutter
Originally Posted By: Win
get rid of the motorcycles.
Why get rid of the motorcycles?
I have a house and two motorcycles.
There doesn't seem to be any reason why he should have to give up his bikes, since they are already paid for.
probably for him to have more money for downpayment and maybe reduce his risk in the eyes of insurance companies which may mean better insurance rates.
Originally Posted By: Win
get rid of the motorcycles.
Why get rid of the motorcycles?
I have a house and two motorcycles.
There doesn't seem to be any reason why he should have to give up his bikes, since they are already paid for.
probably for him to have more money for downpayment and maybe reduce his risk in the eyes of insurance companies which may mean better insurance rates.
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