Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
There's not enough dissent in this thread. Lets heat it up....
Buy the most house you can get, in the best neighborhood, make sure you can cover the payment for at least 18 months (job security or savings). Buy bankowned. Offer 60-75%of asking price.
Write off the highest mortgage you can, and adjust your witholdings to match the writeoffs.
Sell the house for a profit after 2 yrs. Pay no capital gains up to 250k single or $500k married f/j.
Odds are in your favor for equity increases in larger/above median sales price (for your area) homes, especially if you upgrade the basics over a few yrs.
Rates are going to be low enough to balance your decision based on your personal finances. It's a great time to upgrade.
I agree with everybody, but asked the question because I remembered some conversations several years ago where people were insisting that it was best to buy the largest house possible. They reasoned that the price appreciation would outpace the mortgage interest and a 400K house would build equity faster than a 200K house.
A 400K house will also eat through your down payment quicker on the way down. Using leverage to buy an asset which is going down in price is a dangerous game. If you have to ask strangers on the internet if you should do it, you probably shouldn't.
The "buy the biggest house you can stretch in to" was brought to you by the same people who were pushing "real estate never goes down in price". You can see how well that turned out...
There's not enough dissent in this thread. Lets heat it up....
Buy the most house you can get, in the best neighborhood, make sure you can cover the payment for at least 18 months (job security or savings). Buy bankowned. Offer 60-75%of asking price.
At this price, it sounds like you'd be buying from someone who tried your strategy in 2005 or 2006. Shouldn't that be a warning to you?
At this price, it sounds like you'd be buying from someone who tried your strategy in 2005 or 2006. Shouldn't that be a warning to you?
At what price? The market in some areas has corrected/dropped 30%. Rates could stay in the mid 5% or even drop lower.
It is the best time to buy. After the election, the market will go up 5-10% per yr. for the next 3 yrs. Getting in to late will cost big $'s
A 400K house will also eat through your down payment quicker on the way down. Using leverage to buy an asset which is going down in price is a dangerous game. If you have to ask strangers on the internet if you should do it, you probably shouldn't.
The "buy the biggest house you can stretch in to" was brought to you by the same people who were pushing "real estate never goes down in price". You can see how well that turned out...
For some of us it hasn't worked out to bad.
Buy when people are selling, Sell when people are buying. It's not rocket science.
Our latest purchase, dropped $200,000 in 2 months. The assessors real market value is in the $900's, purchase price $450....
The losses are already realized, the gain will turn when the inventory drops, 12-18 months from now. Do your homework, know your area, know the sellers circumstances, and then make an informed offer...
Definitely don't over buy if it's a house you plan on living in for some years.Don't buy the most expensive home in your area.Let the speculator do the speculation on housing;too many are in trouble now because they tried that.If all your wealth is tied up in your home your in trouble now.
Of course there are many variables, but I these are very important. Buy a house you will like now, and in the years to come. I'd rather buy a 'big enough' house that I don't have to sell and uproot my kids, even if it is on the other side of town. Selling and buying will also have a cost of about $25-$35,000. Right? If you have a $400k house and sell it to 'upgrade', then you'll pay closing costs, Realtor fees, moving costs, possible upgrades, points/mortgage fees, AND lose money on the first xx amount of years just paying mostly interest on the first house.
I recently gave this advise to a relative when he was a first time buyer. If you can... buy something that you would like to be in for a long time to come, because the above expenses WILL come when, and if, you decide to move. If you can, put that extra $30,000 or so into THIS house and keep it for a while and grow with it, instead of giving that $30,000 to the transaction of trading up in 6 years etc..
It's not easy, but it can be done if you're looking in the right place.
I think it's magical to buy your first house and live in it for at least 20 years.
btw, he ended up buying a 2 bedroom TH that he plans on selling in a few years, when he has his first child. lol So much for my "advise".
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
