North vs South (Austin, West, Howe: real estate, lease, mortgage)

[emccomb1]

My wife and I are 1st time buyers, I work at Mopac/Far West and she works off Barton Skyway. We have been looking at homes and are pre-approved but likely will only be in Austin 2-3 more years. Where do you think we will get the best return on our "short-term" investment/home.
Looking at 78749/78745 and 78728/78729.
Thanks for your help.

[Raskolnikov]

78749 in my opinion because of the schools and desireability of the area is going up due to the new shopping being built around there. Also many restaurants are coming online in the next few years. It's got the infrastructure (with new grocery stores etc.) to support growth. Finally, because of the new AMD offices right down there.

[jwb123]

If you are only going to be here for 2-3 years... I honestly think you should just rent.

[TexasHorseLady]

If you are only going to be here for 2-3 years... I honestly think you should just rent.

That's my thought, as well. The chance of you ending up upside down when it's time to sell is what I'm thinking.

Are you planning on selling, or are you planning on renting out the property when you leave town?

[AustinGuy]

Buying property for the short term in Texas is generally a good way to lose money unless you have very good timing and savvy location picking skills.

[mimimomx3]

Living in 78749 + working at Far West = lots of time in traffic. That would be a deal killer for me. I would rent for sure, maybe even downtown. That's what I would do...

[emccomb1]

Originally Posted by TexasHorseLady

If you are only going to be here for 2-3 years... I honestly think you should just rent.

That's my thought, as well. The chance of you ending up upside down when it's time to sell is what I'm thinking.

Are you planning on selling, or are you planning on renting out the property when you leave town?

********
We have considered both; we would be moving back to Pennsylvania and have concerns with renting the property from that distance. Originally keeping and renting it was my plan, but the logistics have prooved problematic.
In regards to losing money or ending up, upside down:
I realize that for many of you questions like these come up in your business (real estate) everyday, and I realize that I am very new to this area of business. However, most of the articles I've read, and statistics I've viewed indicate that the Austin market is strong and is expected to continue to grow over the next 5 years.
For example, Forbes recently chose Austin as one of the best places to buy a home: GMP from '07-'12, is expected to increase 32%; and the population over the same period is expected to increase at just under 3% a yr, 15% over the five year period. Other articles have been indicating the same thing, and while most are discussing "over the next 5 years," I can't think they are expecting all of this to happen during the last 2 years of the period. Lastly, with the job market growing due to tech firms (google/paypal/etc.) and the building of the light rail, I can't help but think this should be a safe investment.
If we make money great, break even ok, but I don't think we would lose our shirts with the above outlook.
I know many of you are agents and this is your business, if you feel it is a bad investment and that the market will go down please tell me why.
Thanks again for your input!!

[achtungpv]

Do this. Find out what it'd cost rent a house that is convenient for both of you. Say it's $2000. To buy a comparable house, let's say it's $300K. If you put 10% down plus closing costs, maybe you put down $40K and have a monthly PTI of around $2,500. In 3 years, how much would you earn investing that down payment money + ~$6,000 difference in rent/mortgage? (not even including maintenance costs of owning a house) In a plain old INGDirect savings account you can earn near 5% interest. Is a house in the current mortgage climate going to return that amount of money? Don't think the mortgage meltdown will not affect Austin. The last words of every city before real estate goes pop is, "We're in X, it's different here."

[jwb123]

Even in the positive market some zipcodes are seeing, I cannot imagine making a strong enough return to make it worth it. We owned a home in the Seattle area for 3 years and saw a $155,000 increase in the home's worth - even it the hottest markets here, I am not sure you could see the same return.

Achtung brought up a great point. Take the money you would save by renting and invest it.... then you don't have to even think about the "what if it doesn't sell" when it comes time to move, in addition to the fees you would have to deal with, with selling and simple maintenance costs with home ownership. You end your lease, and move on... simple. easy and smart.

I don't think that as a first time home owner you should necessarily be thinking of the quick turn around. Wait till you will be some place where you could settle, and then buy.

[emccomb1]

Originally Posted by achtungpv

Do this. Find out what it'd cost rent a house that is convenient for both of you. Say it's $2000. To buy a comparable house, let's say it's $300K. If you put 10% down plus closing costs, maybe you put down $40K and have a monthly PTI of around $2,500. In 3 years, how much would you earn investing that down payment money + ~$6,000 difference in rent/mortgage? (not even including maintenance costs of owning a house) In a plain old INGDirect savings account you can earn near 5% interest. Is a house in the current mortgage climate going to return that amount of money? Don't think the mortgage meltdown will not affect Austin. The last words of every city before real estate goes pop is, "We're in X, it's different here."

****
all good points, of which I've considered. Ironically enough I have an ingdirect account and the current APY is 3.4% which is one of the reasons I was thinking buying might be good. I've used some on-line calculators which essentially run your formula and they've been split on our scenario. Thank you for your input.