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marys1000

Pros and Cons of Buying in todays market

marys1000
15 years ago

If you didn't have any other reasons for needing a house (kids, pets, ?) and were selling a house (probably at a loss) and moving to a new job cross country (1 year probation which shouldn't be a problem but you never know)

Expected to live in area 10 years and retire somewhere else.

What would be your thoughts on buying? Why?

Comments (51)

  • qdognj
    15 years ago

    Trying to time the market,catch the bottom, is a fools game..If you want to own a home,buy one..The market has a ton of inventory,you can pick and choose, and interest rates are still very low..Can the market go lower? Yes..Can interest rates rise in the next 12 months? Yes..I believe in homeownership, and i'd buy if i were in your position,however,due diligence is a must

  • cpowers21
    15 years ago

    I agree with qdognj....how do you know when you hit rock bottom? Usually once prices start going back up. I also agree with cordovamom. You should probably rent for 6 months to evaluate the area yourself. You can get a real estate agent to help you evaluate before you get there, but everyone has different preferences. Once you get to the area, you can explore and find where you want to live and look at home prices and schools (if necessary) in that area. At this time you can look for real estate agents if you like. Being there for a while will also give you time to ease into the new job and the new pay.

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  • xamsx
    15 years ago

    marys1000 what is the real estate market in the area you are relocating to like? You cannot just generalize "today's market" because not all areas are buyer's markets just as not all areas were seller's markets the past five years.

  • marys1000
    Original Author
    15 years ago

    Not just the current market got me thinking about this.
    When people were talking about the bubble, would the market keep going up, previous to the "crash", there were a lot of articles that talked about whether to buy or not which sort of became the question - should you ever buy? An accountant I know said he would only recommend buying a house for lifestyle reasons, never money reasons of any kind.
    So I'm not just trying to time the market for buying, but also wondering about buying when vs. at all, selling again in 10 years, then buying a retirement home. ???
    Why do people buy if they don't have kids?
    The market is part of it but its also more of a big picture, financial question.


    P.S. The market I'm selling in never saw the growth the outer rim of the country did. The market I'm going to is Dayton. Where I want to retire, so far anyway is Michigan though who knows.

  • sweet_tea
    15 years ago

    Why do people buy if they don't have kids? "....

    1) Because the adults need a place to live even if they don't have kids living with them.
    2) Because when you rent, rent can and usually will rise each lease period. But when you buy, if you get a fixed rate, your mortgage payment does not rise.
    3) When you rent, you can be kicked out(lease not renewed) usually on an annual basis. This is because the landlord might decide to sell when your lease is up, or might decide to rent to someone else and not you and you must go after your lease is up. Or landlord might raise rent SO high that you move just because of the big increase. And IF that landlord decides to sell, you usually have to let future buyers view the inside of the place even while living there. I had this happen when I rented and vowed to never, ever rent again.
    4) Because you are stuck relying on landlord to do maintenance/landscaping ..often it is either not done, done cheaply or not done to your taste.
    5) Landlord can enter the home for inspections/maintenance. You lose some privacy. No thanks.
    6) If you like to garden, you are usually out of luck with a rental, even if a rental home.
    7)Don't have a pet but decide you want to get one? Oops, if you rent you have to get permission from landlord and if landlord says no, you have to move in order to get the pet.
    8)You get income tax deductions for mortgage and property tax payments. Often this makes owning cheaper than renting.
    9) You might be an organic type person, and possibly the landlord sprays inside and outside for bugs. You are stuck with this even if you are against breathing it. It is not your choice.

    1. landlord decides to paint the place lime green. Too bad if you don't like it.
    2. If you are in an apartment complex, well, yuck.
    3. The landlord doesn't want a bbq grill at the house, then you can't have one.If you own your house, no landlord to tell you you can't have a bbq grill.
    4. Let's say you don't have kids, but maybe you have grandkids. Well, when they visit, it sure is nice for them to play on the yard swingset that is in the home that you own. Nice for their doggie to stay in your hard when they visit for spring break. A rental usually won't allow pets even for visitors.In fact, many rentals don't allow visitors for longer than a week or two.
  • minet
    15 years ago

    "Why do people buy if they don't have kids?"
    ----------
    What does having kids or not have anything to do with it? Plenty of kids grow up in nice rental houses. Or apartments.

    Our kids are grown and gone. We just sold a house, moved to another state and bought a house. Not big, about 1800 sq ft. Lot is just over 1/4 acre. We wanted enough room to kick around in but not so much that it was a hassle taking care of.

    But last week at a garage sale I met a man a little older than me who is selling his house and they're going to live in a 33' trailer. He said he didn't want a house anymore.

    I like having my house. We can paint, put up fences, garden where we want to, make changes we want to. We know the mortgage payment is always going to be the same, every month, rather than dealing with rising rent and leases.

    If you're not familiar with the area you're moving to, I'd recommend renting for a few months until you know traffic patterns etc.

  • cpowers21
    15 years ago

    Having a house is supposed to be about freedom to do with it whatever you want. Sometimes community have covenants, which is just supposed to keep your homes' worth at the same or better. Renting can be the way to go for some people. If you are planning on spending 10 years in a place, I think the home would be the better choice. That's just my opinion though. My husband is military and we buy a house everywhere we go. It's sometimes a nightmare to sell. We couldn't settle on a agent and ended up just going with someone neither of us wanted. She did a great job for the market we were in, but it didn't sell nearly as fast as we wanted it too.

  • cordovamom
    15 years ago

    Our kids are grown and gone (the youngest graduates from college this May). We're still going to look for a home in the city we're being transfered to. After 30 years of home ownership I just can't imagine it any other way. This time though we don't need to focus on schools and having enough space for 4 kids!!! So we'll downsize, but still buy or build a house after we scope out the new market.

  • Nancy in Mich
    15 years ago

    marys1000, I believe that it does depend somewhat on where you will be moving to. If it is one of those areas where housing prices have been high, but are now taking a dip, it might be best to buy soon. Otherwise, I would rent for at least 6 months, maybe the whole year. I know that a worker can fail at a job for no fault of their own (psychotic co-workers, impossible expectations...) so waiting until you are sure about the probation is a good idea. My friend was fired just before her 90-day probation period was up, and until a week before she was fired, she loved the job and was doing great! What is with a 1-year probationary period? I have never heard on one so long.

    Having moved with a corporate transfer back in the old days, when we were flown to the new town and escorted all over until we found a place, I know that it can sometimes work to buy right away. I just think that the economy, housing bubble, war, and other things make it a bit too hard to predict things in a new area, so waiting a while might be better.

    So you hope to retire here? How cool. Maybe you should rent at the new area and sink your capital into your retirement home here in a year or so - you'll probably get a great deal. ;-)

  • saphire
    15 years ago

    Sounds like Michigan is a great deal right now, in 10 years who knows

    I am advising a friend with kids moving to Florida to scope for 6 months to make sure she likes it and knows what part of the area she wants to live in. When you are new you have no idea

    As for payments being the same, everyone conveniently forgets taxes which in my area would be as much as my mortgage and go up every year

  • eal51
    15 years ago

    You can't worry about the present market is you are going to buy or sell. Right now the NE is down, prices are starting to stabilze but there is a large inventory. Good buyers market, okay sellers market.

    You do what you have to do, when you have to do it.

    Enjoy the journey.

    eal51 in western CT

  • marys1000
    Original Author
    15 years ago

    Well I originally posted this question hoping it wouldn't be all about me moving, just some:).
    Wondering what people here think because a lot of people here seem to know about finanances, real estate etc. Obviously I am going to consider any info and apply to my situation but was wondering more generally because I swear I remember a whole raft of articles and people on tv over a year ago and they were all recommending considering renting. Part of that was because of the bubble concern at the time but part of it was home ownership isn't financially all that people think it is so if you don't need to why not consider something else.
    For those of us who don't and never will live in those markets where you see appreciation like the big rim cities (Cal, FL, D.C..) I'm not sure the current market really figures into the decision. Michigan not withstanding most of the middle of the country never had the hot market to crash from, things are slower, maybe way slower but the prices are only a little bit lower, maybe.
    I think timing the market for us is really only a very small factor.
    Here's like the 3rd thing that came up on a google - obviously he has a little bit of a rant going on and I don't see any particular qualifications - but some of his points still seem valid. His arguments seem geared toward California.
    Seems to me it comes down to - are you financially comfortable with paying for the lifestyle of home ownership considering in many areas you are not likely to make money on your house, that after taxes, mortgage costs etc. you may even lose some money.
    As for moving, renting then buying. I did that moving here, my stuff was in storage for 1.5 years. My wood furniture and some of my brass lamps were pitted with tiny mold spots. I could hardly complain after 1.5 years. Considering it was in pretty good shape. But that was a cost ands a major pain to move again when you finally buy (and usually costs more to have delivered so much later). If I had a couple of strapping teenage sons maybe I wouldn't think twice:)
    I may end up doing that, its all flexible depending on whether I find a place I can't live without, how selling my house goes etc.
    Really my next 6 months to a year are totally up in the air and I'm in reaction mode. I have no idea what I'll do.

    Here is a link that might be useful: http://patrick.net/housing/crash.html

  • chisue
    15 years ago

    I think financially one is ahead renting -- IF you can find something that suits you. (Big "if".)

    Over time, houses appreciate 4% per year. Hard to believe after the recent boom in some areas, but I figured it out on our own home, owned for 30+ years and sold in 2000 for what was a record price in our neighborhood.

    You can rent a long time with the interest or earnings on the money you don't have tied up in a house. The landlord, not you, has the expense of maintaining the rental.

    In a way, home ownership can function like Christmas Savings Clubs or Payroll Deductions: enforced savings. Houses usually do appreciate -- just not all that much over time except in unusual circumstances.

    I doubt we will ever rent again -- too picky about where we live. (That "if" was too big for us!)

  • sweet_tea
    15 years ago

    I rented a home for 3 years when moving to a new state. During that 3 years, I lost about $45k because I rented and did not buy. This is because the property values rose that much during the 3 years on all the homes in the area where I rented. I thought I was so smart by renting...ended up being a bad financial move to rent.

  • minet
    15 years ago

    In parts of SoCal, where we just moved away from, renting is very expensive too. Our son still lives down in OC and his rent on a 2 bed, 2 bath apartment is more than our current mortgage + taxes + insurance on a 3 bed, 2 bath house on 1/4 acre. So renting isn't always a financial plus.

    But if you're not sure you want to stay there, or you only plan to stay for a few years, then I think renting is probably fine.

    I just prefer to have my own space, to do with as I please. It's a lifestyle choice.

  • likesdoilies
    15 years ago

    There was a terrific article on March 12 in the Wall Street Journal on this very topic. It's "Why Your Home Isn't the Investment You Think It Is" by David Crook. Besides taxes, people forget to count insurance, mortgage costs, maintenance, major repairs and improvement and so forth. Mortgage interest is still something that one pays, even if it is offset somewhat by the tax deduction. (The lower your tax bracket the more your mortgage costs you percentage wise.)
    Also there's insurance.
    We don't have a mortgage anymore yet our RE taxes plus insurance total nearly $700/month.
    As the author points out, "Buying a house with a long-term mortgage is just another form of renting. ... Mortgage interest is rent that you pay your lender for the use of its money rather than to a landlord for the use of his house."
    Since WSJ articles are available only to subscribers, I'd advise people to check their local libraries. Or pay $4.95 to read the article on line. It is geared toward people who think their home equity is a big part of their retirement nest egg, but he covers more than that.

  • novahomesick
    15 years ago

    Here's a link providing free access to the WSJ article mentioned by likesdoilies. Real estate articles printed in the WSJ are published online in WSJ's free Real Estate Journal. They are usually printed a day or two after appearing in print.

    Here is a link that might be useful: Why Your Home Isn't the Investment You Think It Is.

  • saphire
    15 years ago

    Article did not deduct taxes

    Also smart renters pay insurance too

    Another question, is buying for investment to rent out ever make sense

  • chisue
    15 years ago

    saphire -- Sam Zell has done very well "buying and renting", but I don't have that skill level!

    My mother once bought an old farmhouse on a large lot. A subrub had long ago swallowed up the area and there were two-flats along the same street. There was a second farmhouse on large lot next door. When the next door neighbor was ready to sell, the two parcels went on the market together. It took some legal work to re-zone, but there are 11 townhouses there now.

    We've also been fortunate with the Maui condo we bought in 2001. It's our vacation home for one month of the year and is a vacation rental the rest of the year. It carries itself, saves us $5000 in vacation rent, and it appreciated wildly in the recent boom. (Can't count on that uptick, though.)

  • ziplip
    15 years ago

    that WSJ article is big bs. Almost nobody lives in same house for 30 years. Average time is 5-7 years. most people are morgage free after 4th home.if they do it right.
    and one more thing.REALESTATE MARKET WILL NEVER CRASH!Never had,never will! RE Market crash is bigest bs from media and self proclaimed smartasses.
    Market will correct itself and life goes on!

  • saphire
    15 years ago

    REALESTATE MARKET WILL NEVER CRASH!Never had,never will! RE Market crash is bigest bs from media and self proclaimed smartasses.
    Market will correct itself and life goes on!

    Really, did you try selling a New York area Co op in 1991! Good Luck. Sure it is worth more 16 years later but I was getting married and moving, I had to get out! I bought in 1987 (yes I was an idiot) and was trying to sell in that 5-7 year window mentioned in this thread and it was impossible and still get out whole. Some of my friends could not sell without taking a 50% hit

    Classmates in California had to give their houses back to the bank, and this was two responsible Yuppies with advanced degrees, where the property declined and one became ill

  • cordovamom
    15 years ago

    The real estate has had many crashes and recoveries in my lifetime. We've been fortunate enough to buy at the low of most of those crashes, but know many many people that lost a bundle. Maybe you're too young to remember 1980 and home mortgage interest was up to 16% in some parts of the country, we actually had a mortgage at 13% !!! The only homes that were selling were those that people could assume mortgages on at lower interest rates. Yes it did correct itself but to say there haven't been any crashes is not correct.

  • chisue
    15 years ago

    There have been some big busts in RE. And, yes, WE lived in one house for 30 years! (That's the one I figured we made 4% per year on when we sold. 'Course we had a place to live while making that 4%.)

  • xamsx
    15 years ago

    Almost nobody lives in same house for 30 years.

    I know a lot of people (most of my family members actually) that have owned the same home for over 30 years. We've had several houses in our family for close to 100 years (purchased by another generation when a great-grandparent died). I "only" owned my last home 12 years, so I was the exception to our family rule.

  • western_pa_luann
    15 years ago

    "Almost nobody lives in same house for 30 years. Average time is 5-7 years."

    I know plenty of people who have been in their home for 30 years (mom being only one of them!).
    We have been in ours for almost 20... and half of my neighbors have been here long before we moved here.

    Not everyone picks up and moves every 5-7 years.... Can you cite a reliable source on that stat? And we are mortgage free... with just our second house.

  • ziplip
    15 years ago

    right. Almost. I was reffering to nationwide crash,but ok.Corrections in different states,but not nationwide.

  • saphire
    15 years ago

    Actually in 1990 I do not know of any place that was doing well in real estate, Texas was still a mess, NY, California. No one was buying vacation houses, whether in Colorado or houses in the Hamptons could be bought at bargain rates. Builders were struggling to sell new construction

  • marys1000
    Original Author
    15 years ago

    You know I've been looking at houses in OHIO
    and while they are certainly priced as "mid-west"
    they are still about the same or actually higher
    than here in Omaha which is a very nice city with good
    employment rates.
    Wish I could "buy low". Instead I'm selling low and losing money.
    I think maybe I should live in a yurt.

  • drcindy
    15 years ago

    I, too, know of many people who have stayed in their homes for over 30 years. Granted, most of these people are in my parent's age range, but there are quite a few out there. Secondly, I echo sweet tea's reasons for owning a house when one doesn't have kids. Children or no children has nothing to do with home ownership. My husband and I don't have kids and would NEVER consider renting. Why throw money away when we know we're going to be in a certain area for a long time with stable jobs and incomes? We enjoy our home and almost everything that comes along with home ownership, and we are building equity.

  • cordovamom
    15 years ago

    marys100 -- don't forget to look at the property taxes either. My oldest son and his wife life in a suburb of Cleveland and I'm shocked at how much they pay in property tax. I'm not sure about Dayton, but don't forget to factor that into the cost of your home.

  • PRO
    acdesignsky
    15 years ago

    Western_pa_luann's question made me curious. Here's some info I found from the US Census Bureau

    The "average American" makes 11.7 moves in a lifetime (based upon current age structure and average rates of moving by age between 1990 and 1993). By age 4, an American can expect to have 10.8 moves remaining. At age 19, 9.2 moves can still be expected. But by age 44, only 3.1 moves remain. The actual mobility experience of individual persons, of course, will vary from these average numbers. In addition, since these moves are not evenly distributed throughout that average American's life, we cannot calculate an average length of stay in a particular residence.
    end---

    This gives a fairly clear picture that most Americans don't stay in one home for very long. It would be interesting to see the figures for home owners vs renters.
    Of course, many people do live in homes for decades, even generations, but it's not very common.

  • saphire
    15 years ago

    Sounds like people move in their 20s and early 30s before they marry or before they have kids. Sounds like some of those are rentals or roomate situations or perhaps a starter home or condo. I wonder if they count college in that.

    Age 44 might be trade up house, 20 years, downsize house 15 years and then maybe assisted living of some sort.

    Still more than 5-7 years

  • vtchewbecca
    15 years ago

    Hmmm. If it includes college:

    1 move prior to college
    5 moves during college (counting there & back once for each year)
    On our 4th move since we got married...we've been in 3 apartments all over VA, now we're buying a house

    I guess we just have our move to assisted living! :o)

    We've tried to pick a house in a good solid neighborhood, where we can stay for a good looonnngggg time, perhaps until the assisted living bit.

  • jy_md
    15 years ago

    Looking at the Census data, if a person moves on average only twice between birth and 19, that pretty says to me that his parents have stayed put for almost 20 years.

    I know I moved around a LOT before getting married and having children - I probably pushed the average way up. I moved every year in college (switching dorms, moving off campus, etc.), I went abroad for a year, I went to grad school and again moved every year. When I started working, I moved every time I got a new position. So I moved 9 times by the time I was 25. BUT my family (parents) only lived in two places - moving only once in my childhood. My parents lived in my childhood house over 30 years.

    As to why buy in today's market. I think the market is irrelevant because let's face it, you're not the market. It all depends on your needs/wants/preferences. There are tons of people in NYC who have only rented and there are people who would only buy. I wouldn't necessarily be swayed by the state of the housing market.

    Maybe you should research where you want to retire and buy land there so that you can build a house later.

  • chisue
    15 years ago

    To go back to the original question about today's market, and ingnoring that all real estate markets are local...
    Nationwide, the price decline in RE isn't over yet.

    In Chicago, Mesirow economist (and usually extremely bullish) Diane Swonk says: The brunt of the real estate downturn lies ahead. Home prices clearly are falling faster than what we are seeing in the official data. (I am paraphrasing, but that's the jist of it.) She says sellers are going to have to price more aggressively.

    Tomorrow the March housing starts will be announced; the prediction is another 4% drop. New housing is only about 20% of the market, I think, but builders are businessmen, judging if there is a market for their product. Looks like they see a declining market.

    Until this bottoms out, and if this is mostly a financial decision for you, why would you buy now?

  • saphire
    15 years ago

    I think that is the central question, has the market hit bottom where the poster wants to buy. It is concerning in her case because she only plans to be there for 10 years. If you bought in NYC in 1987, by 1997 you may not have gotten your money out yet (although if you bought in 1996 and sold in early 2006 you would have made a fortune). So where are we is the question

  • jy_md
    15 years ago

    If the question is mainly a financial one, then you also need to ask the obverse. Let's say, you decide to rent because you believe the market has not bottomed out. Instead, you put your money toward your retirement house (fund or actual land/house). How would you feel if the market had bottomed out and you missed the market boom?

    I had neighbors who had this happen to them. They had rented in Maryland for about 10-15 years. They bought a gazillion acres in Nebraska (well, more than I can imagine because I'm basically urban in nature)in the 1980s and over time, built a modest house. By the time I met them, they had improved the retirement house to a very nice house indeed. But they felt they had missed out on buying a main residence in Maryland, wasting money on rent and losing out on tax benefits as well as an increased house value. They ended up buying a townhouse at surprisingly the right time because they bought at the beginning of the market increase.

    For me, nothing in life is certain so I would still go with my own lifestyle preference irregardless of the housing market. Ten years is a long time in one's life living day to day, but in terms of a market, it isn't very long. So, another question - are you willing to be "uncomfortable" for 10 years (if you're the homeowner type of person) renting instead of owning in exchange of lower financial risk?

  • saphire
    15 years ago

    I personally would never buy in an area I did not know for the first few months, it may turn out I hate the job or the area. After I decide I want to stay, then I would choose something based on whether I was an owner or renter and where I thought the market was going (I horrible at predicting though). It is usually pretty easy to get a short term rental, maybe 6 months or so

  • marys1000
    Original Author
    15 years ago

    To put OP spin on this versus theortical, the market I'm considering buying and living in for 10 years is Dayton Ohio. I don't think timing the market is an issue - I think the market where I'm looking, outside of town to the east has probably ben and still is fairly flat or neutral. I do not predict this to ever be any kind of hot market, nor would I expect this to be a market that I would make much if any profit on the house. If anything, should Wright Patterson AFB ever be BRAC'ed (unlikely it would get shut down completly but could be made signficantly smaller) then the housing market would tank (like has happened here in Bellevue Nebraska near Offutt).
    I think the advice to rent is good, but the idea of storing and moving twice is almost more painful that I can bear.
    mainly I'm worried about retirement/finances vs. lifestyle I guess.

  • saphire
    15 years ago

    So you are saying there is no real upside in appreciation except possibly in line with inflation (have you researched historical home prices in this area?). You plan to only stay 10 years and there is a possibility that the market could tank due to something you have no control over and have no advance knowlege of? Plus you will have to pay closing costs and possibly broker commissions when you sell?

    I think the answer is that assuming there are nice rentals in the area and you have no plans to aquire a pet (some rentals say no) I would run the cost benefit of renting v owning for your particular financial picture inclusing tax issues and also factor in the rate of rent escalations in your area. I would be inclined to rent but I am not the one living there

  • jaynees
    15 years ago

    I agree that there ARE people out there who live in houses much longer than the average. In NoNJ both of my neighbors had been in their houses for 10+ years (one for 12 years, the other for 15 years). The couple who'd been there for 12 years plan on staying for at least another six and will think about moving after their son finishes college. The couple who has been there for 15 years will be there another two years and then once the husband retires they will move to Nashville to be near their son who recently got married and settled down in TN. So you are looking at 18 years for one family and 17 years for the other. I'd say that's major longevity!

    My parents bought their latest house in 1991 and are still there with a plan to be there at least another 3-5 years. Once my dad retires they will move south with an eye on buying acreage to build a house and business on. So that'll be another couple who stayed in a house twenty years.

    My grandfather stayed in his house for FORTY YEARS and only sold when my grandmother died and he couldn't keep up the house by himself. If she hadn't died I guarantee they would have stayed in that house.

    In my own instance, my DH and I are planning on living in this current house until our children go to college (they are 3yo and 4yo now). We're already planning some minor renovations (add a bathroom to create guest suite being the major one) knowing that we're going to be here a LONG TIME (read: at least 15 years).

  • sweet_tea
    15 years ago

    Older generations (our retired parents, our grandparents) generally stayed in their homes for many, many years.

    It is the current baby boomers and generation X-ers that tend to move/sell more often - especially those that have already moved away from their original home town.(Once you have uprooted once, it is easy-as-pie after that.)

  • dssxxxx
    15 years ago

    My parents bought their house in 1956 and expanded to nearly triple in size and still live in it (Dad is 86 and Mom is 82). They have had a home in FL since 1979 and use it, maybe 20 days a year. They plan to never sell their present home.....:-)

    I built my home in 1984 and have just purchased a new condo (March) in SW FL. I am 60 and wife is 50. We do not plan on selling our present home (NNJ) or the one in FL.

  • PRO
    acdesignsky
    15 years ago

    I'm 35 yo and in house #15. BTW, that number doesn't include dorms or college apartments. Since I was married 13 yrs ago, we've owned 3 houses and lived in 2 apartments.
    I have moved more than most people my age that I know, but 90% are on their 10+ move. The average length of home ownership in our current neighborhood according to our Realtor is 3.5 yrs. That's pretty much the life of middle management.
    We've been in this house for almost 3 yrs and may just stay until our DDs graduate HS in 8yrs, or we may get a great opportunity and move again much sooner. Like someone said, once you leave that hometown (if you ever even *had* a hometown) it's really easy to move again.

  • marys1000
    Original Author
    15 years ago

    Here's another twist to the question. Suppose I "sort of" compromise. Don't want to live in an apt or condo but knowing I'm only going to stay 10 years, knowing there's little appreciation in area etc.
    Buy a "compromise" very small (one of those tiny 2 bedroom places at 950 sq ft), older somewhat crappy place that gives me the space I want - and I can afford to pay cash, no mortgage.
    Frankly I'm not good at the finance thing. I had a little paid off house in Michigan and having no write offs paid in to the IRS every year. But my current tax preparer was the only that told me don't buy a house for tax reasons (now that I have a mortgage and don't have to pay in- ???)
    Or does the closing costs, no tax write offs etc. even with cash still make buying a house a poor financial decision and primarily a lifestyle decision?

  • chisue
    15 years ago

    angc's post will tell you that the house to buy for a short time is one that is newer, turnkey, and easy sell to the next temporary owner. DH's company was the original mover of personnel all over the world. Guys would be in one spot long enough to "get their ticket punched", then be moved to the next ladder rung, wherever it was. Big companies aren't doing that so much today. Today the employee is waiting for the head hunter he has signed with to call with the next job offer, wherever that may be -- and now it's guys AND gals. These people buy "middle of the road" houses they know they can sell in a few years.

  • jy_md
    15 years ago

    I'm with Chisue. If you buy and you are positive that you will move in 10 years, buy the newest house within your budget. You certainly don't want to spend time fixing up a "crappy" house if it's not your forever house. Also, as Chisue points out, it's much easier to sell these types of houses.

    Can you find a house to rent? Maybe if you get lucky, you'll find a rent with option to buy. That will give you some space to decide whether or not to buy without the second move.

  • saphire
    15 years ago

    The cost of the house is not with the mortgage (if you have cash you can always pay that). It is the use of the cash you are losing (what else could you have invested that 100k in that generates money?) Worse it is the transaction costs, title insurance, property taxes, taxes on the sale, Brokers commissions on the sale. Worse, it is being stuck with a house you no longer want and cannot sell due to market conditions at the time.

    If you must buy then get something standard on a good street (whatever that means locally, either quiet and pastoral or central and close to amenities) as the other posters suggested

  • xamsx
    15 years ago

    Moving every 3 years!? I cannot imagine that is worth it unless the corporation is picking up the closing and moving costs never mind the decorating costs, etc. The opportunity cost would have to be very great to uproot your family that often. I know my mother moved a lot until high school. The trauma of moving just as you made friends and always being the "new kid in school" was very real for her. She and my dad have lived in my childhood home for over 40 years, and my mother is (just barely) a baby boomer.

  • marys1000
    Original Author
    15 years ago

    Oh you guys!- those houses that you describe are just what I can't stand.
    I have never lived in a big "cool" city but when i moved out of my little starter suburban neighborhood in Michigan I told myself - no more suburbs. Its rural(ish) or if a big city - a little place in a hip downtown neighborhood. I've done some reading on dayton and while it has its urban renewal neighborhoods they do not seem big enough or hip enough to tweak my fancy. And once again, finding a country property in my price range is not happening. And country homes just sell harder anyway. I know and understand what yoru saying but I can't stand those places. (sorry don't mean to offend those of you who live in them, really)
    My choiches literaly seem to be - crappy old small farmhouse (they don't all come with gorgeous woodwork and oak 2x12s) on a couple of acres or something quite a bit larger and newer at or just beyond my comfort zone - you know the one where you brown bag, no vacations, no car replacement nada.
    I worry about the crappy scenario anyway - because one of the reasons I always lose money is that i can't stand not to have things up to my standard. Not cosmetic things that might make me money back but all the high dollar windows, furnace's and things that, even if all new people just seem to expect.
    So....lose money, rent or live in something sellable I don't like. Geez. Well that's life.