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Old 10-02-2010, 03:23 PM
 
Location: Foot of the Rockies
86,871 posts, read 102,258,726 times
Reputation: 32945

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Quote:
Originally Posted by EscapeCalifornia View Post
I think renting vs. buying is about the same in most parts of the country. Of course once you buy, the mortgage cost is (hopefully) fixed and will eventually go away. Rent will increase at the inflation rate or more. When it comes time to retire, I'd rather have a mortgage-free home to live in than an ever-increasing rent check to write every month.
True, that, but the OP is debating between having a mortgage and paying cash for a home. I agree that one should be very careful about an extremely low priced condo, and find out everything possible about HOA fees, what they cover, etc. That said, if it's a good deal and they have the cash, I would say pay cash, or at least a very substantial amount down for it. Depends on how fast one can replace the money, too.
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Old 10-02-2010, 03:26 PM
 
Location: Colorado Springs
4,781 posts, read 4,890,585 times
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Truth is that you never actually "own" a house or condo. Taxes, insurance, maintenance, HOA dues and utilities must be paid monthly. However, I think a cheaper house would be a better bet than a condo. However, you might not like the neighborhood.

Personally, I think it is a better bet to rent now. If mortgage rates go from 4.5% to 9%, the payment on a loan doubles. Housing prices will continue lower.
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Old 10-02-2010, 05:26 PM
 
4,420 posts, read 7,111,709 times
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Quote:
Originally Posted by Vision67 View Post
Personally, I think it is a better bet to rent now. If mortgage rates go from 4.5% to 9%, the payment on a loan doubles. Housing prices will continue lower.
Of course, if interest rates are pushed to 9% it's because people have discretionary monies to spend thanks to a recovering/recovered economy and prices go up to reflect that extra cash.

2bindenver posted up something a few weeks ago that compared housing prices this year from last year, and prices are UP despite the interest rates being DOWN (granted, only about 3/10ths of a percent, but still down).

I'm firmly in the camp of buy now and it's best not to have more than 50% of a property "paid" for as the money does better elsewhere working for me. But I grew up with my dad being a certified financial adviser too, puts a little bias on ones opinions.

Last edited by Brian_M; 10-02-2010 at 06:07 PM..
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Old 10-02-2010, 06:29 PM
 
Location: Foot of the Rockies
86,871 posts, read 102,258,726 times
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DD and I were just talking about this issue of "the best time to buy a house" and we agreed the best time to buy a house is when you can afford it. Just because interest rates and prices are low right now, that does not necessarily make it the best time for you (or me, or her).
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Old 10-02-2010, 09:31 PM
Status: "Celebrating 30 years as a Broker" (set 17 days ago)
 
Location: Just south of Denver since 1989
10,882 posts, read 29,304,638 times
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More than a few of my past clients have kids in their 20's now and I have been having the same discussion. Is now the right time?

Here are a few questions to answer:

1. How long are you planning on staying in the same place?
2. How much are you paying for rent? What are typical rent increases?
3. How "stable" is your employment?
4. How much would a mortgage payment be?
5. Are you happy where you are now?
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Old 10-02-2010, 10:05 PM
 
Location: Foot of the Rockies
86,871 posts, read 102,258,726 times
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Great questions. Thanks for your input.
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Old 10-03-2010, 01:34 AM
 
16,438 posts, read 19,079,306 times
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Quote:
Originally Posted by EscapeCalifornia View Post
Rent will increase at the inflation rate or more.
prop tax and insurance can also go up as high as they can jack them. I owned a house in Texas for 23 years and my payments doubled in that time from increases in tax and insurance. I had to lower the rent several times just to keep people in it. I fed that mortgage more than $200 a month for years while having to also pay rent myself elsewhere. Don't buy unless you're sure you can live in it long term.
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Old 10-03-2010, 11:52 AM
 
Location: Colorado
2,561 posts, read 5,006,973 times
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Make sure if you go ahead there are no surprises..read the community Docs..I just got hit with a $2,500 special assesment on a rental condo of mine. I have tried to sell it off and on for the last three years. I have been fortunate though to have had it rented most of the time. For what it's worth location generally trumps any sort of perceived discount pricing. Buy the lower end in a higher end neighborhood.There is also little substitute for rental demand in any type of market if you get stuck and need to move quickly.
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