Moving from renting to owning a home: What was that experience like for you? (to rent, mortgage)

[nikorock28]

Originally Posted by artyst

actually it does because if you listen to your heart, you'll know what you ultimately want in life. then you have to use your head to make it happen very happy healthy successful girl here as a result!!

Once you have determined your budget to the penny, then, yes, go ahead and listen to your heart to decide what property to purchase within the allotted budget. Do not neglect the extra expenses that everyone has mentioned. Do not listen to what a lender thinks you can afford... only you know what you can comfortably afford. Once you have done all your homework, then feel free to listen to your heart :P

[sablebaby]

We finally bought our home early last year from renting for the last 10 years. It was much better for privacy and not hearing the neighbors loud parties and such. And not dealing with apt managers and landlords.

However, we bought at the END of the high market and probably bought too much house. We DOUBLED our rent, going from $1050 renting to almost $2100 for owning. BIG increase. I probably wouldn't do that again. Some days I wished I still was renting as we'd have a lot more money in our pockets, even though I hate renting.

The things I found with owning is the extra costs of landscaping and the upkeep of the house. There's always something that either needs to be maintained or replaced. We had to paint the house over the summer, so that was an extra $2400, then we did some updating of putting stone veneer and new lights (another $800). But, the house looks great. The landscaping is going to be next. We *might* take out the half green/half yellow grass and put down rocks and have it landscaped nicely (anyone want to guess what that will cost? I don't want to know yet).

I'm going to have to up my private practice to keep up with everything.

[Great Joy]

Originally Posted by sierraAZ

With new construction you have no idea beforehand what the upgrades are gonna end up costing. Then after shelling out so much for the house, you'd want to make it nice. Rolling the cost of the upgrades into the mortgage is particularly tempting. Besides, you don't wanna move in and start ripping it apart almost immediately. You'll have to buy some of the appliances. The beautifully landscaped yards of the models look cool, but you'll get your yard on dirt unless you pay to have something done with it beforehand. I was gonna have that, but then changed my mind.

Oh, btw, if you go with a new house, be very careful which builder you choose. Some houses that look less expensive at first will end up being a lot more expensive than another builder's higher base price which includes many more perks. Some builders' bare-bones houses suck so badly that you'll have to spend another 50-60K to have a somewhat decent home.

Chances are good you WILL overextend yourself somewhat. Just make sure it's not way over your head.

I agree with sierraAZ. Be careful and don't be fooled by the new builder's base prices. I think it's more than "which builder"; it's really "every builder". Builders make their model homes and yards look awesome, but that's because they have tons of upgrades. If you're considering new construction, then also ask for the upgrade price list so that you know how much the house will truly cost. And, don't forget about figuring in the the cost for landscaping/backyard features (add another $5,000 - $70,000+ for that), interior paint, window treatments, etc when buying a new home. If you're considering resale, there are less "cost" surprises when purchasing the home (just closing costs, etc). Good luck!

[sierraAZ]

Originally Posted by Great Joy

I agree with sierraAZ. Be careful and don't be fooled by the new builder's base prices. I think it's more than "which builder"; it's really "every builder". Builders make their model homes and yards look awesome, but that's because they have tons of upgrades. If you're considering new construction, then also ask for the upgrade price list so that you know how much the house will truly cost. And, don't forget about figuring in the the cost for landscaping/backyard features (add another $5,000 - $70,000+ for that), interior paint, window treatments, etc when buying a new home. If you're considering resale, there are less "cost" surprises when purchasing the home (just closing costs, etc). Good luck!

While a lot of models obviously have bells and whistles, the inclusions in the base price do vary greatly from builder to builder. There's no comparison between what KB and DR Horton include and what Pulte includes... I'd imagine Pepper Viner (local here, I believe), Lennar are also good about it. Well, you have other builders up in Phoenix as well, but my examples are with mass national builders. A decent-looking KB house has about 50-60K upgrades. Horton has 5 legal-size pages of upgrades... it's gotta tell ya something.

[Great Joy]

Originally Posted by sierraAZ

While a lot of models obviously have bells and whistles, the inclusions in the base price do vary greatly from builder to builder. There's no comparison between what KB and DR Horton include and what Pulte includes... I'd imagine Pepper Viner (local here, I believe), Lennar are also good about it. Well, you have other builders up in Phoenix as well, but my examples are with mass national builders. A decent-looking KB house has about 50-60K upgrades. Horton has 5 legal-size pages of upgrades... it's gotta tell ya something.

I agree with you.

I agree that inclusions vary among builders. I was just saying that it is important to understand the inclusions, regardless of the builder. I think we can safely say that all builders have upgraded models, and that the final purchase price of a new home will always be higher than the base price. About number of upgrade pages, I think it also indicates the extext to which a builder is willing to "customize" a home for a buyer. Some builders will do more "custom" changes, and some are more "generic".

[MotleyCrew]

We bought our first real home (not condo) back in the early 80's just before a recession. That was sobering at 17 3/4% interest. We survived but many of our friends were too tempted to furnish their new homes right away. I think we sat on the floor with the babies for a few years. I would advise taking the home with the basic carpet and lino if you can stand it. Also go with Formica and do your upgrades for the cosmetic things later. Do upgrade things that would be cost prohibitive later, like electric, insulation etc. Best of luck to you and enjoy!

[sierraAZ]

Originally Posted by Great Joy

I agree with you.

I agree that inclusions vary among builders. I was just saying that it is important to understand the inclusions, regardless of the builder. I think we can safely say that all builders have upgraded models, and that the final purchase price of a new home will always be higher than the base price. About number of upgrade pages, I think it also indicates the extext to which a builder is willing to "customize" a home for a buyer. Some builders will do more "custom" changes, and some are more "generic".

Well, the only "custom" change that Horton (with the 5 legal-size pages of upgrades) does, for example, is paint the house in your desired color (not even sure about that... could be just just a choice of a few colors other than white). Their standard houses come with brass handles on the doors (think ugly yellow brass)! The garages are not finished. A lot of the builders offer only vinyl (in the wet areas) included in the base price. There's this joke going around about KB "Oh, you wanna door... that'll be... " No assumptions should be made with these guys!

[mj0723]

My wife and I were in the same situation about a year ago when we moved to AZ for our new job. We rented an one-room apt in PHX for about 3 months, and I just couldn't stand the noise in the parking lot (shared parking space) and the lack of privacy (there's a window that sees straight into our restroom) for the apt. Sure, we paid A LOT less for the apt compared to our home, but the privacy and the pride of home-ownership to me are worth so much more. Not to mention we no longer have to deal with the a$$h*le landlord who doesn't want to fix anything for us.
Both my and my wife's family owned homes, so we know that home-ownership is what we ultimately want in our lives when we got married. Like others have stated, plan out your priorities, know ultimately what you want in life, that will make your decision-making process alot easier. If you're looking for a new home, I suggest you get a realtor who knows the area you're looking for and go with a national builder since they are less likely to go bankrupt in today's housing market. The realtor should help you get more discount from the builder, or get more incentives for your upgrades and etc. All in all, good luck with your decision and hope you'll enjoy it as much as we do.

[steve22]

I think it really comes down to how stable you are and whether or not you think you'll be settled and living in a location for the long term. I think that unless you're prepared to stay in a home for at least 5 years, then buying makes no sense. Keep in mind that for the first several years of mortgage payments, you're just paying off principal- meaning, you're not gaining any actual equity in the home. Essentially, during that time, you're just paying rent to a bank instead of a landlord- and most of the time, that mortgage payment is going to be a whole lot more than your rent was. So basically, unless your house gains value at a pace that exceeds the amount you're paying in principal costs each year for those first few years- not likely unless you bought at the beginning of a huge upsurge in a VERY hot market- you're probably not going to make any money, and in fact you'll probably lose money overall compared to renting if you stay less than several years. Now if you think that you'll be somewhere for the long term, such that you'll actually be able to reap the benefits of the eventual equity you'll earn, then it's definitely worth it.

The problem is that people get tricked into believing that they're "making" money in real estate when they sell their house & see a big check. That's often not true. Between the principal, the interest, and the costs of repairs/upgrade and so forth, often times you're essentially just getting what amounts to a rebate at the end when you sell. Unless you really do stay in a place for 20+ years, you earn close to full equity, and it accumulates in value enough during that time that you actually do make a substantial profit when you sell. But not many people do that. And that's very hard to do if you're in a home less than 10 years, unless you're in a rapidly gaining market.

[krispydude]

me and my gf are renting a home in north peoria for $1025. we got a killer deal (moved in 3 months ago). we tried to get a loan but it was a very bad time for first time homebuyers without 20k for a down payment. we are happy staying renters for now and just throwing the extra money each month into our brokerage account which will prolly net us a better return over the long term.

two weeks ago the coil in our AC unit went out. $4000 to fix it. i dont know what we would have done if we would have been responsible for a repair like that. these kinds of things scare us into buying.

we will definitely be renting for a while with the way house prices are still so high for young couples with no equity from another home. plus, we can get up and move whenever we want.