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Looking for advice from those who feel like they "know" the Lexington real estate market well (to include nearby counties)...
We are trying to determine whether or not we should buy vs. rent.
For clarification: we are not interested in recommendations based on low interest rates and mortgage interest tax deductions. Having gone through one of Dave Ramsey's classes, we are pretty debt adverse.
We would plan on living in the home 2-4 years.
My concern is that nothing would appreciate enough in that time frame to justify the costs associated with home ownership (maintenance/upgrades, property tax, realtor fees, etc.).
I am interested in what the normal rate of appreciation is throughout Lexington, and then if there are pockets/neighborhoods where one can expect a significantly higher or lower appreciation. (I am assuming a higher appreciation might be true for say Cassidy and Rosa Parks neighborhoods based on previous posts.)
We are not "throwing" money away right now by renting (our rent is lower than our property taxes + interest payment would be for a house). So really the bottom line is whether or not we are in a market that is appreciating, and if it is - is it enough to really come out ahead in 2-4 years?
O I hate to even suggest this but I have to because I am one of Dave Ramseys biggest fans! If you go to his site...look for what he calls elp's. I'm sure you know what it stands for but for the rest... it means endorsed local providers. He has a list of people that he approves in each area. I am a realtor but don't yet have enough experience to be on his list! I'm sure you could find a local expert there!
I have lived in Lexington almost my entire life with a few exceptions of college interns and summer breaks on the beach so I will tell you that if you do not know the Lexington market and you decide to buy...I WOULD DEF. USE A REALTOR. I will tell you why. I am sure it's like this almost everywhere but it def. holds true for Lexington....You can buy the same house (square footage/amenities) for a totaly different price few miles apart and if you don't live here you don't know why...For example Chevy Chase (nice older community) houses are outrageous! You could buy the same type of house off Southland Drive (for a lot less). Both areas are appealing but the old money in Lexington would pay a lot more for an area thats just down the street. To you...you couldn't tell a difference.
I would rent if you are only thinking out 2 years. Our market is stable ( I don't care what the national media is saying) It is slower..but stable. However, we have months of inventory on hand right now and I don't expect the market to increase enough in such a short amount of time to make it all worth it and there are great places here to rent. Nice houses and apartments. To answer your question we typically see about a 5% increase per year but I am not seeing that now. What I am seeing is houses under about $250,000 holding steady. I have seen quite a bit of price reductions in the higher end houses.
If you buy now I would think in 2 years the value of your home would increase slightly, but after all of the closing costs and realtor fees to sell.....we'll ...I thing you would come close to breaking even depending on the house.
LOVE DAVE RAMSEY!! You have to live like no one else now to live like no one else later!!!!! Good Luck!
On the other hand if you pay higher for a nice neighborhood on the front end the house will appreciate much more than the same house in not as good of an area.
btw-we live in Ashland Park. We recently decided to move to the Lakeview area. We had not one but two offers within 2 days of listing our house. We accepted one and it was for 98% of our asking price. We've lived here 9 years and a little more than doubled our money on the house.
So it does hold true that in real estate it is all about location.
Unless you get a really good deal on a place, I would probably rent. Our market isn't bad, but we haven't seen much appreciation since 2006. There are exceptions of course. I sold a house in winter 2005 and again in last month. They had about 5% appreciation over 2 years.
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