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I'm considering buying a house in the near future
By The Mana Knight 01-10-2011 06:52 PM
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920 views |
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All right, I will blog about one major thing that has been on my mind as of late. After dealing with my rent increase and being a little jealous of my Dad purchasing my sister a house, I'm now thinking about buying a house/condo/townhouse in my near future.
Previously when I looked at houses in various areas around me, the cheaper ones I could find were at least $250k, and listed putting down around $50k on it. I don't have that amount of money just yet (been working my job for 18 months), but I'll eventually get there. I saw one townhouse nearby me I could put down a $10k deposit or something and only pay around $1000 a month for mortgage. However, I believe that house is gone because I never saw it again. After talking to some co-workers, I heard about various sites that listed foreclosed properties for a pretty good price. After looking around, I have been seeing some decent deals around (even if housing prices are crazy high in the Baltimore/Washington area, unless I were to live in the Eastern Shore, around Frederick, or even PA). While I understand some places will need a lot of work or may not be good enough to live in, I'm getting the feeling I should start checking some out and seeing if I can ever buy something. I'm not really looking to buy some massive house, would be perfectly happy with a 1500 square feet townhouse/condo. While I'd LOVE to have a garage, getting one for a decent price will probably be difficult. After visiting one of my CAG friend's house, it's definitely what I want most in the world. It would be nice having a more stable residence, not feeling like my money is going down the drain for rent. I think owning my own place may even be appealing to people of the opposite sex. I'd love to have my own yard right now (even if small). Some say I should just sign a short lease at my current apartment and look at houses, but with the increase of rent, saving up for a place will be even more difficult. There are some things that make buying a house a little harder for me than some people. While I don't have any debt, some houses I might not be able to make a big enough down payment on. If I was moving to the Midwest, I'd have a very easy time buying a house (east coast is freaking expensive). Another reason is my credit history. While I never filed for bankruptcy or never been in debt, my credit history isn't all that established. It's not like every credit card out there will accept me (I got denied from some). Another major problem is my future. I just don't know if I'll be staying in the Baltimore/Washington area. Personally, I would love to stay here for the rest of my life (unless I can end up with a job that puts me in the Chicago area, my favorite area of the country). However, my career is still being figured out and hope to decide what job suits me best. While my area has excellent jobs, coming from a big college from the Midwest kind of makes it harder on me since most companies that know my college/major the best are in the Midwest (but the Midwest has a pretty bad job market right now which explains why I no longer live there). Despite some issues, people say now is the best time to buy. I do feel buying a house would be a better decision than me upgrading my car (my car is a 2003 w/ 90k miles, still runs but needs just a little bit of work). Housing value should go up down the road too. If I can't buy a house, I am looking to at least rent a townhouse/condo now. I could possibly move into a cheaper apartment (with a longer commute), but then it could be short lived if I decided to buy a house (causing me to move again). Ugh, it's a tough decision I'm really trying to make right now. Some wonder why I want a house when I'm single with no family, but in ways I'd like the space of a house to myself. Anyone else remember when they bought their first house? Would anyone recommend I start considering buying (I'm 28 years old btw)? |
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Posted in Life |
 Comments (Total Comments: 15) |
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raarar
- 01-10-2011, 08:22 PM
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If you did wind up getting a place and needed a new car, you could take equity out on the house to pay for it. Not the worst idea if your mortgage will be the same as what your paying for rent now.
Myself, I'm too paranoid for that kind of thing. |
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mykevermin
- 01-10-2011, 08:49 PM
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You live in Bawlmer, yeah?
You can find plenty of housing for well under $250K. Depends on how much of an 'urban pioneer' you wish to be. Buying now is a good idea, as there are rumors that the Fed is looking to raise interest rates in the middle of this year, meaning mortgage rates will go up substantially. Do it. |
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h3llbring3r
- 01-10-2011, 09:43 PM
Updated 01-11-2011 at 02:07 AM by h3llbring3r |
The new 20% down standard is a bear; However, you can likely qualify for many first-time home-buyer programs with better terms. Be aware, that townhouses and condos appreciate (and depreciate) differently than traditional homes. Also, I am typically averse to subdivisions with strong HOA's . . . but in townhouse communities strong HOA's are much more ideal. When you are attached to two or more other homes what your neighbors do can immediately and severely impact your quality of life (imagine your neighbor giving drum lessons at 7am on Saturday or another neighbor running an exotic animal rescue from their townhome).
I tell you all this as someone whose gone the townhouse route. Lastly, do get an agent if and when you decide to buy as they earn there money (we've done it w/o one and made expensive mistakes despite doing research and having plenty of guidance). Lastly, use two separate home inspectors for two sets of inspections (not sure about the cost in your location, but these are relatively affordable here). |
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dopa345
- 01-10-2011, 11:00 PM
Updated 01-11-2011 at 10:44 PM by dopa345 |
TMK, think long and hard before you buy as this is a life changing decision (I myself went through this with my wife a little over a year ago). Don't fall for the hype of this being the "best time to buy," the housing market will remain depressed for many years to come so there's no rush. Besides the down payment, there are thousands of dollars of fees and other crap you'll also have to pay upfront. Also your mortgage payment will likely be higher than your current rent unless you end up buying a dump. In addition to your mortgage, your monthly payment also includes escrow for your insurance and taxes and possibly PMI depending on your down payment.
There are lots of factors you need to take into account. I'd suggest getting a book like "Homebuying for Dummies" which spells out the process. Best of luck regardless of what you decide. |
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scionxiii
- 01-11-2011, 02:48 AM
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dopa is right about all the extra dollars you will have to spend. Owning is nice but you should know what you are getting into a little more before thinking about a decision. You will also have to take into account maintenance. You are responsible for the A/C, water heater, and whatever else the breaks and needs replaced every 5-10 years. The housing market has been bad for years and people are still not buying. You'll have a good chance to buy a house any time between now and the next 5 years. Everyone is scared to spend their money due to the economy and are trying to save now.
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eldergamer
- 01-11-2011, 11:40 AM
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At least if you buy now you're not likely to end up owing more on the house than what it's worth like we do. (We bought 3.5 years ago)
But if you're just a single guy, what would you need a house for? Extra space? A house isn't an investment and unless your rent is going up substanially every year, I say why bother. |
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nddave
- 01-11-2011, 12:02 PM
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Im gonna side with elder on this one.
Leave the maintenance, housing depreciation, and Intrest for somebody else. If you single enjoy your money somewhere else |
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aosora13
- 01-11-2011, 12:12 PM
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Mana, I have to agree with Dopa, the housing market will probably bottom out in the 2020s so probably in the next decade. Currently houses in the US were overpriced because of 'cheap' money by low rates by the Federal Reserve. Currently when companies started to invest in people's housing loans and started to cut them up, you realize that the idea of buying a house and getting equity (as one member mentioned) you are losing as some properties have mained their value to some point while others have been devasted by the defaulting on loans for housing and the low buyer purchasing of homes.
It is sad (on a side note) how your sister is an entitlement princess and your dad dotes on her. I missed reading your November Blog on this. I cannot believe how in this country that constant mistakes as you mentioned with driving while intoxicated that your dad does not say. "Dear, I love you but I am not going to bail you out this time.". Sadly, I know that she is "Daddy's little girl", it probably is not going to happen. You are doing much better than your sister, even in your circumstances from landlords that like to rip off tenants. I think you might want to first rent a cheaper place and then contemplate if you believe that buying a condo/townhouse is going to be the right decision. HOA fees are usually the worst part of buying the type of units you are considering buying. Hopefully the best advice is to do research, try to see based on the economic front if it is in your best interest. Honestly, I believe you might want to wait until prices bottomed out though paying rent is kind of a sunken cost (~negative). |
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the_grimace
- 01-11-2011, 12:21 PM
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Honestly, I don't think this will affect your views at all, but I felt the same way after living in my apartment for awhile. All I wanted more then anything was a house and yard. A place to truly call my own.
Honestly though, my current apartment in Illinois is pretty nice, but I still wanted a house. Then I went home to visit my parents, and my opinion quickly changed. I saw my parents house at how broken some things were. Remembered all the yard work that needed to be done. In my apartment if something breaks, I call matinance and they come and fix/replace it. Our grass is always neatly cut. Snow is promptly removed and parking lots plowed. I have all new appliances, which in itself is some 5,000 dollars. I have no Homeowners fees or taxes to pay. Pest control is usually included. Some utilities that you probably take for granted like trash or sewer are usually provided free. Anymore for me, i really prefer living in my apartment, and will wait much longer now for a house then I thought. and like some other's have said. I too have realized its pretty stupid for a single guy to own a house. Would you really use the space? Generally I come home, and spend most time in one or two rooms and that's all I really ever need (aside from a bathroom and cooking area) Even more so, I often spend more time out of my apartment then I do in it. A house for you at this time may be too much. It's hard to justify it. Even if you can have a mortgage that is less then your rent, all those fees and total responsibility of the place could easily double what you were paying for rent. Just tread with caution. |
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The Mana Knight
- 01-11-2011, 05:44 PM
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@To all, it's also much quieter in a house than apartment. Apartment you can constantly hear people walking by (due to halls) and constantly see cars pull in/out late at night. While they might maintain your place a little, they continue to raise your rent and pretty much take your money (that you can't earn back like a house).
Maybe one day I'll have a family, but I know plenty of single people with their own house and like it, which is a big reason as to why I'm considering it. |
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ratzombie
- 01-11-2011, 06:39 PM
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Not necessarily, you could still have noisy neighbors living in a house... especially a townhouse or condo.
If noise is really such a problem at your current apartment, maybe you should look for a new apartment complex. I just don't think that is really enough to justify purchasing a house, but it's your money. |
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The Mana Knight
- 01-11-2011, 06:52 PM
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@yukine, pretty much every apartment I had to deal with noise (now or college). Some townhouse/condo areas don't have many places around you, which is kind of what I was looking at. But overall, noise is just part of the reason.
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DonDonRaiden
- 01-12-2011, 06:15 AM
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My wife and I went from a 1 bedroom apartment to a two-story townhouse and it was an amazing experience.
We went down the route of buying a house, but with my wife being a medical school student and myself being a fresh grad in 2008 and working a temporary (though well paying job) for 2 yrs we couldn't get approved even though we had a $20k down payment for a $90k loan. The town house is great. We have an attached 2 car garage and we have a corner unit which has a nice patio and yard to it. Sure, we have 3 other units attached, but I haven't heard anything from our neighbors. |
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machtdh
- 01-12-2011, 10:08 AM
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davidb69
- 01-12-2011, 10:10 AM
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Personally, I'd never go with a townhome, too many community rules you have to follow. There is a show called house hunters, they give you some good tips on what to look for. Make sure you don't buy what you can't afford. Never be afraid of offering 10% lower then the cost of the home. In this market, it might get accepted. You can also ask for settlement assistance. There are a lot of fees, especially for sellers but there are also fees that go to you the buyer. Make sure the home is properly inspected. Be smart, you'll be good.
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