any good GR neighborhoods?

[suydam]

Don't forget that the "SE Side" is a huge area. There are spots that are bad and there are whole neighborhoods that are fine (Ottawa Hills, Alger Heights).

I have three pieces of advice:

1) You should not rule out EGR. You like a neighborhood and need 3BR? Go find a house listed for $180k and offer $140k. You never know what will happen in this market because, frankly, many of those homes have been listed for a while. If you have young kids and you're looking to make a long-haul investment, you might like that approach.

2) Alger Heights is a great neighborhood. I would look there over Eastown, especially with kids as you'll be more likely to have neighbors with kids. It's nice to be near other families and I think Alger Heights is the perfect place for 20-somethings to meet other 20-somethings. I would look here for sure. Plus, you get to eat at Real Food Cafe which is a great plus in my book. That place is great.

3) Have you considered looking at Rockford? The downtown is great, there are homes in traditional neighborhoods within walking distance of the shops and you'd have great schools to boot. You mentioned Christian schools as an alternative, but don't forget they cost money. You could spend the money on your house in a great district (which helps your resale value...something you mentioned as a concern) instead and probably end up even. Rockford (and EGR) would certainly provide that.

[suydam]

Moderator cut: orphaned - the post you are quoting got deleted or edited

Regarding rent vs. buy: The argument is easy when values go up and you stay in the house you bought long enough to have it appreciate more than the closing costs and realtor fees. Don't forget, you're paying a realtor 5% or more to sell your house and you're spending a few grand on closing costs. Just to break even, you need your equity to go up enough to cover the difference.

When housing values go down, you're throwing money away on the house the same as a renter. It sucks, but it's true.

[TimWhite]

Originally Posted by suydam

Regarding rent vs. buy: The argument is easy when values go up and you stay in the house you bought long enough to have it appreciate more than the closing costs and realtor fees. Don't forget, you're paying a realtor 5% or more to sell your house and you're spending a few grand on closing costs. Just to break even, you need your equity to go up enough to cover the difference.

When housing values go down, you're throwing money away on the house the same as a renter. It sucks, but it's true.

Moderator cut: orphaned - the post you are quoting got deleted or edited
A couple of follow-ups to your comments, however. First, a listing agent typically gets 3%, not 5%. Some realtors will list for less, other may go as high as 3.5%.

Secondly, it is very difficult to lose money in real estate, especially as a homeowner. There are ups and downs, and you obviously want to sell when the market is up. However, even if you own a home and sell when the market is down, you can easily make up the difference in buying at really low prices. Think of it like the stock market...Would you wait to buy stock until it is at it's highest? No you buy when it's low, and sell when it's high. That's why we say there has never been a better time to buy than right now. Home prices are at record lows, and interests are still very low.

You are never throwing your money away when you own a home. Even if you have to wait for the market to come back around, you still get tax credits and can eventually sell for a profit. How much of your rent are you going to recoup in five years?

[suydam]

The data on rent vs. buy is clear. If you hold your home for a while, ownership is going to beat renting because, as you've pointed out, any gains through ownership are preferable to renting.

If you lose a job, are forced to move, or buy into a neighborhood that appreciates at a slow rate, you can easily lose money on your purchased home. If you buy a home that requires maintenance that would otherwise be covered by your rent (appliances in an apartment complex, for example) you could lose money. If you pay closing costs (buying) and realtor fees (selling) you can lose money.

It's happening to people by the 100s of 1,000s right now nation wide... so I'm not making this stuff up.

It may be less volatile than the stock market, but it's still an investment fraught with risk in the short term (10 years or less), especially here in Michigan.

[magellan]

Originally Posted by TimWhite

Moderator cut: orphaned - the post you are quoting got deleted or edited
A couple of follow-ups to your comments, however. First, a listing agent typically gets 3%, not 5%. Some realtors will list for less, other may go as high as 3.5%.

Secondly, it is very difficult to lose money in real estate, especially as a homeowner. There are ups and downs, and you obviously want to sell when the market is up. However, even if you own a home and sell when the market is down, you can easily make up the difference in buying at really low prices. Think of it like the stock market...Would you wait to buy stock until it is at it's highest? No you buy when it's low, and sell when it's high. That's why we say there has never been a better time to buy than right now. Home prices are at record lows, and interests are still very low.

You are never throwing your money away when you own a home. Even if you have to wait for the market to come back around, you still get tax credits and can eventually sell for a profit. How much of your rent are you going to recoup in five years?

I know you sell real estate and everything, and have to tow the company line, but come on. What you are saying is not only wrong, but dangerous.

There are many people who were told that "now is the time to buy" last year, and the year before, and the year before, who are stuck holding the bag with declining home values and rock-bottom sales prices. It doesn't help when 50% of the homes being sold are foreclosures, and builders are still trying to unload inventory homes with big incentives.

As suydam said, if you buy a $200,000 today and have to sell in 3 - 4 years, you need to come up with about $10 - $12,000 to pay a Realtor fee (listing and selling agent's fee) to get the home sold. So that means that your $200,000 home has to appreciate at least 2% a year in that time period, and you have to get exactly that price for the home without concessions.

I'd say if you NEED a home, and plan to stay in it for at least 8 - 10 years, now might be a good time to buy.

[aeb1021]

thanks, everyone, for your help :-) we have considered renting for awhile too not only b/c of the economic situation at present but because we want to be completely sure that we CAN stay in a home 8-10 years before we buy, which in MI right now is difficult to predict. But we will definitely look into Alger Heights, EGR, and Rockford whether it is to rent or buy... thanks again for all your input!