with a low income like 27,000 is it smart to buy a house or continue renting?

Answer 1

if you can find a home in your price range that will appreciate in value, i think putting $$$ towards equity rather than just rent is a good idea - but make sure it's a home that will grow in value - and don't do an interest only mortgage unless you're disciplined enough to pay more than what's due each month

Answer 2

I'm going to give you an answer that no one else will, do neither.
Pretty crazy huh? Here is what you do. Find someone that is willing to lease option you a house and get them to give you a 25% rent credit towards the purchase. Try to get it for at least 5 years. If you are ready to buy, I'm going to assume (I know) you have at least 5,000$ for closing costs, etc. Well, you could buy an option to purchase with that same 5000$ and probably come out way ahead. With that assumption let me show you some math.

If you bought a 100,000$ house, you would use that 5K for closing costs and get nothing, and still owe 100,000 after closing. So let's say your actual payments were 700$ a month, you would get about 100$ a month of the equity, so you might end up with 1200$ at the end of a year.

Now, if you got 25% of the rent credit against your costs....25% X 700 = 175$ per month off, at the end of the year, you would have gotten 2100$ rent credit. If you did that for 3 years, you would have 6300$ off of the price of the house, 2700$ more than if you straight purchased it. PLUS, you get to live there and have the owner do the fixing up and you get to make sure it is where you want to live without being tied to the neighborhood too much.

The more you can talk the owner down on the option, the better, and if you can get him to put at least 1/2 of the option payment then you'd be in even better shape.

Now, you don't get the same breaks on taxes with lease/option the way you do with owning...but at the 27,000$ income bracket, I think this would be a way for you to get into a house and on the path to owning it much faster.

Good luck. And alway do your due diligence, good mechanical inspection should always be done first, and if you are ever wary of the person you are doing business with, get a good lawyer to look over the contract. If they aren't interested in you seeing the contract, don't do business with them.

Answer 3

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Answer 4

With renting you are not making an investment. You are throwing away money on which you could be saving on a down payment. are you renting a apt or house? See if you can find a house that has the option to buy. That would be a great thing to do. Because you are investing $ in the house and with the apt you are not.
Right now is a great time to find a house for rent, espically with your type of income. Also start if you haven't save some money here from each pay check. That could be used as a down payment on your rental house. Good luck!

Answer 5

I think its wise to try to put your income towards a new house. I make 30g's a year and i'm 23 and I was told I didn't have that good of credit to get a loan and buy a house. I rent an apartment for $785 each month and not a day goes by that I wish that much money a month could be going towards a home I could at least call my own. I've been there for two and a half years now because I can't get a house and thats like $23,550 i've spent in rent that could've went towards a house I could've actually kept. It makes me mad but I guess credit is the key. So if you got it, go buy a house quick.

Answer 6

Even if you made a lot more money this year, it is best to continue renting as home prices across the country are high, interest rates continue to move up, and too many homes are on the market. Too many are selling, too many have high adjustable rate mortgages, at a time when wages are falling, as is the value of the dollar. If your local area is anything like mine you may be seeing 3 or more homes for sale on any given street. If this is the case, smile--because your ability to buy will directly correspond to the number of homes the bank gets stuck with when the defaults come raining down.

Answer 7

From experience, if you have the money for the down payment, GO FOR IT! Renting a house will be the same payment as your house payment if you buy. Don't continue to throw youre money away by renting. Trust me, get past the down payment and your house payment will be just like paying rent. Consolidate your property tax and renter's insurance into your payment and you will have just one payment for all three. It will be worth it in the long run. You are just throwing money away by renting. Don't wait too long because the housing market, the way it's going, interest rates are climbing. Now is the time, don't wait until interest rates make it too difficult to buy. Good luck!

Answer 8

You are making a investment decision. As such you need to alot of research. If you can afford it most likely it's a good idea. In most areas of the country it is proably more expensive to buy than rent. If you can save the difference to pay cash for cars, pay of credit cards, you may be better off renting. Housing prices will start falling proably in the fall this is due to extremely high inventories in most areas. Talk to a local real estate appraiser. If you are going to buy definitely consult with a appraiser.

Answer 9

Go to your local city hall, they have affordable real property for sale geared towards people with low income. You mighthave to wait a couple of years to get placed into a home purchase opportunity. Use that time to fix your credit. City hall might even have grants so that you can purchase these homes. Then call Fannie Mae and find a lender near you who does low income Fannie Mae loans. You can also go online:
http://www.fanniemae.com

Click on "find a mortgage", then on "mortgage solutions", then on "by borrower needs" and you are shown a great many programs for low income people. Not so many brokers know about this, so make sure you find a list of lenders from the website or by calling, that know about and do these programs.

It's amazing what the government does to help people who help themselves.

Regards

Answer 10

That's tough to answer. Depends on what you're current bills are and how much your debt is taking out of your paycheck. Real estate can be a great investment, but look hard and carefully when committing to something that can take a huge toll on your credit rating should you foreclose.

Great book to consider buying is Home Buying for Dummies. I think that's the name of it. Real easy read with a lot of good pointers of what to consider when buying and when it's not right to buy.