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That's crazy! This what I want to avoid when I eventually leave NY. The most I plan to stay on the island is probably another 9 or 10 years. 5 years the earliest. That's also why I am hesitant. I'm a bit of a minimalist so I don't even have that much property and don't need a large place. But there aren't many 2 bedroom homes on the market (which is why I am leaning towards townhouses/condos)
IF you are only going for a 2 bedroom, I would advise to go the townhouse/condo route. Generally speaking, a young family has no where to go with a 2 bedroom if they want to start a family. The baby's room eliminates that room as a guest room or office. It goes without saying that you could always expand, but that costs money too. For many, a townhouse is a better option because many buy when single or just starting out and then when more money is available buy a house. Two bedroom homes are usually more difficult to sell.
I'd suggest at least 3 bedroom home. If not, try to find yourself a small 2 bedroom cape with an attic you can finish later.
Buying a home is a big financial decision. If you are planning on moving in 5-10 years you may want to factor in your closing costs when considering what you would pay monthly compared to an apartment.
I can break down my 4bd/1bth small cape with a 30 year mortgage vs a 2 bedroom apartment at $2500 a month.
Closing Costs: $29000(including %3 down payment)(29000/120 months= ~$242 a month for 10 years)
Monthly Payment: $1700(including taxes and PMI)
Monthly Heating: $200(oil estimated for the year)
Rainy Day Fund Monthly: $300(for repairs)
A 2 bedroom apartment will probably have water and electric charges similar to a small house.
Adding that up comes to $2442 a month.
Keep in mind that the monthly payment will go up as taxes increase.
If I was planning on moving within 5 years, then renting may make more sense.
I'm looking at spending at least 10 years at this spot and will probably pay of the mortgage early with extra payments.
Even if home prices drop, I'm probably better off buying than renting due to rental increases over the years.
In addition I get to have a yard, a basement, a shed, a driveway, and a pool.
Buy a house if it makes sense as per your income. I make about 15k/mo and my mortgage is 2k after refinancing. Guess where that other 13k goes? Investments that some day will make life better. The issue is when people make little money in Long Island and have a huge mortgage payment.
Also, paying more money down doesnt make sense as that is capital that could grow much faster than the appreciation of a house - which by the way if you plan on living in it for a long time - should not be factored in. Who cares if your house has 2M in equity when you live in it... Unless you refinance and get that cash to buy a stock market recession dip, your equity in the house is worthless.
If you make 8k here and have a 3k mortgage, that's 'alright' but just barely. You need money not just to live, but to get your life out of the bottom 90% into the the top 10%. If all of your savings is going to your living expenses, then I suggest you start thinking and making a plan that's going to get you out of the crappy situation.
If your job here can give you 8k but only 7k in florida or texas, then financially speaking it's better to leave elsewhere because even though youll earn less, youll spend less... and not only that. Financially you will be less stressed if you bring in 7k/spend 1.5k than if you made 8k and spent 2.5k. What if you lose your job? Want to pay 2.5k passively or 1.5k passively? How much savings do you have? What if you wait too long and your money devalues. What if you invest too much and the market crashes? If it crashes and you invested it all, how long for a rebound so you can buy the 'dip' on housing? Does housing crash lag a real estate crash?
Figure this all out, but my 2cents is get something worth it, affordable, TLC so you can fix it up as most people in LI live in either crap holes or painted over crap holes. and ALLWAYS get something that has a basement is not near water/ lowest house on the block. Also, if you want to opt out on the cheaper states, make sure you're buying a house with a 1 ft thick concrete foundation as they tend to have more tornado's and hurricanes. A 5 inch thick concrete foundation is a quarter as strong as a 10 inch thick foundation (area holds the house - not perimiter) 10x10 vs 5x5 = 4 : 1 ratio.
Not sure that you care, but with a house think of everything that could possibly go wrong and how will it affect your life. Do you want to be on the I95 with your newborn running away from a CAT5? Do you want to stay here and pay 15k inn property taxes for a subpar crumbling house? Make sure that whatever you do - you get a good deal, if not financially, make sure you get something in return while you get fked financially because at least then you have something worthy of your penny that you got ripped off of. It'll make you feel better when life turns for the worse.
Last edited by Punkster55; 02-06-2021 at 11:34 AM..
Not sure that you care, but with a house think of everything that could possibly go wrong and how will it affect your life. Do you want to be on the I95 with your newborn running away from a CAT5? Do you want to stay here and pay 15k inn property taxes for a subpar crumbling house? Make sure that whatever you do - you get a good deal, if not financially, make sure you get something in return while you get fked financially because at least then you have something worthy of your penny that you got ripped off of. It'll make you feel better when life turns for the worse.
Yes I definitely care! This is one of the main reasons why I never bought a home at this point. I've seen my landlord, and hear stories from my coworkers about the constant money they put into their houses either due to repairs or "upgrades". They always have these silly projects they're doing - new floors, new windows, new this, new that. Even after spending 400k or so on a house!
I honestly prefer renting, but I really don't like being at the mercy of an obnoxious landlord, and while the laws in New York are strong, they're not too great if you rent in a single family home that's owner-occupied.
I just need a place to shower, sleep and cook. I don't want to be bothered with much else.
Yes I definitely care! This is one of the main reasons why I never bought a home at this point. I've seen my landlord, and hear stories from my coworkers about the constant money they put into their houses either due to repairs or "upgrades". They always have these silly projects they're doing - new floors, new windows, new this, new that. Even after spending 400k or so on a house!
I honestly prefer renting, but I really don't like being at the mercy of an obnoxious landlord, and while the laws in New York are strong, they're not too great if you rent in a single family home that's owner-occupied.
I just need a place to shower, sleep and cook. I don't want to be bothered with much else.
I think renting is a waste of $$ but to each to their own. You’re paying a mortgage anyway (your LL’s) so you might as well pay your own
That's crazy! This what I want to avoid when I eventually leave NY. The most I plan to stay on the island is probably another 9 or 10 years. 5 years the earliest. That's also why I am hesitant. I'm a bit of a minimalist so I don't even have that much property and don't need a large place. But there aren't many 2 bedroom homes on the market (which is why I am leaning towards townhouses/condos)
It is almost impossible to time the market. My example is easy to avoid if you don’t overpay. I also took advantage of a corporate relocation which essentially made me whole.
But if you are seriously considering leaving in as short a period of 5 years I wouldn’t buy, especially right now when the market is super hot.
I think renting is a waste of $$ but to each to their own. You’re paying a mortgage anyway (your LL’s) so you might as well pay your own
Sure, but if OP thinks a move might happen in as little as 5 years it’s a lot of hassle for little return. If we get a recession over the next 12-24 months (certainly possible) that could impact the situation 5 years down the road.
The market could continue to increase, which would be good for resale.
The market could take a dive, which would hurt resale.
The market could flatten, which would make it harder/more competitive to sell.
Sure, but if OP thinks a move might happen in as little as 5 years it’s a lot of hassle for little return. If we get a recession over the next 12-24 months (certainly possible) that could impact the situation 5 years down the road.
The market could continue to increase, which would be good for resale.
The market could take a dive, which would hurt resale.
The market could flatten, which would make it harder/more competitive to sell.
If she goes the the condo/coop route, perhaps she could rent it out (provided rules permit), if the market is flat or difficult. Just a thought.
Yes I definitely care! This is one of the main reasons why I never bought a home at this point. I've seen my landlord, and hear stories from my coworkers about the constant money they put into their houses either due to repairs or "upgrades". They always have these silly projects they're doing - new floors, new windows, new this, new that. Even after spending 400k or so on a house!
I honestly prefer renting, but I really don't like being at the mercy of an obnoxious landlord, and while the laws in New York are strong, they're not too great if you rent in a single family home that's owner-occupied.
I just need a place to shower, sleep and cook. I don't want to be bothered with much else.
2 things.
1. Any house you here will require renovation, and NEVER pay a contractor for job that you can do that you want to do. If you don’t want to do it, neither will he and your 10k,20k,50k is going down the drain anyway and you will end up redoing HIS work anyway. Everything you do in life, do it yourself. If someone else’s does it, you risk the chance that someone passionless will do it. If you’re ok with that, or are passionless yourself in this aspect, then go ahead with contractor but at least plan it out well.
If you’re lucky, really lucky, you’ll buy a house that isn’t flipped and seller isn’t greedy (don’t count on this). People that live in well taken care of homes don’t sel their homes.
2. What’s your monthly income after taxes? 5k? 7k? 10k? 15k?
If 5k, leave the state. You can earn 5k in a no state tax and low property tax state.
If 7k, you can find a 3bd cape for about 400k and fix it up in a town like Babylon. You’d spend about 2.5k/mo on everything including utilities mortgage taxes home insurance and pmi. (Don’t put more than 5% down if you can. Paying the pmi is worth it).
If 10k, you can do same as above 7k or upgrade to a bigger house and pay 3k mortgage all in or same small house better area.
Do not buy a home here if you’re mortgage is going to be 3500 and income 7k. Just an example but you can legit go to Texas and earn 6k while you spend 1.5k , leaving your more savings and IF you lose your job - you’ll have much les stress paying off 1.5k than 3.5k.
Think of this. For every month you work in TX, you get 2 months safety oh. Here you get 1 month, and that’s if you don’t eat.
All in all buy a home but choose where. You don’t want to solve just one problem -but many problems in one. Low income and high rent? Get high income and low mortgage. Easier said than done but if you’re getting screwed right now, pat yoursef on the back because the first step to success is realization that you’re on the bottom.
Sure, but if OP thinks a move might happen in as little as 5 years it’s a lot of hassle for little return. If we get a recession over the next 12-24 months (certainly possible) that could impact the situation 5 years down the road.
The market could continue to increase, which would be good for resale.
The market could take a dive, which would hurt resale.
The market could flatten, which would make it harder/more competitive to sell.
I still think it’s better than renting. I see your points but still. Renting works well for some. I did it only very briefly & I hated the idea that I was paying money to help someone else pay off their house / pocket that $$ when it could have gone to me.
I mean yeah homeownership is a PITA lol but it’s also incredibly rewarding & awesome.
Renting does give u flexibility that buying doesnt ..
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