Should I buy a condo even if I know I want to leave town in within a year?

Answer 1

You will probably lose out financially compared to renting. Unless you're sure the value of the property is going to increase significantly between the time you buy and sell, the closing costs, fees, and possible realtor expenses will usually cause you to lose money.

Rent a place, and make sure you have an early-termination clause in the lease if you know you're going to be there less than a full year, and you should be better off.

Answer 2

Yes you can do this - and the interest is a tax write off, but you have to include rental income on taxes also, and off set it with any home repairs etc. When you get your mortgage, if you have a pp (pre-payment) for 2 or 3 yr's you may want to ask your lender and/or broker to waive the pp. It will cost you a .25 hit to the rate, but well worth it if you plan on selling. and the prepayment is normally 3 Percent of the total loan amount....depends on the lender, and you will know up front form your lender/broker what you have, way prior to your closing....if you have pp at closing and it was not disclosed to you, do not sign the paper work at the closing. Ask ?'s if you do not know the answer -

Talk with a broker, a broker underwrites for many company's (I underwrite for 150 companies) so I only have to pull credit 1 time, and they look at my credit. A single lender (not a broker) has programs available, but they may not be able to help you and your situation, so you go elsewhere, and than that person pulls your credit (see what I mean.) If you shop, your credit is pulled and that is considered a soft pull, for a 30 day period. Just like shopping for a auto, it is good for 30 days. If you apply for a credit card, that is considered a "hard" pull and it drags down your credit score.

Try to find someone (broker) that will pull your credit one time, and submit your loan application to company's that will go off his credit report. By the way, a loan application is called a 1003, and they will issue you a GFE (Good Faith estimate, with-in 3 days, that is per the RESPA laws, and the TIL (Truth in Lending). This will tell you the up-front closing cost (etc) associated with your loan. This is a estimate only - not the final - but it does help you figure things out.

Decided on the type of program (loan ) you are wanting. A 30 yr fix is still roughly at a 6.5 rate right now - but if you are needing a 90 percent ltv the rate is around 7 percent and a 95 ltv is 7.375 and a 100 percent rate is 7.5 ( This is a estimate only, since I do not know what your credit score's are....There are also, interest only loans - adjustable loans, option arms (where you pick the payment, from 4 payments, including interest only). Interest only are lower payments, but nothing is being paid on your home. Some self-employed ppl like the payment options, in a lean month when money is tight., they can pay a lesser amount.

Good luck...

Answer 3

I would suggest renting. The Housing market is finally weakening and condos historically got the best beatings on a decline (although condos are built better now). Since the housing market has run up so much in many areas, and rents have not matched the rate, it's often cheaper to rent than buy. A one year stay is pretty short. What if you have trouble getting renters. The property management fees on single rentals can be pretty high. Their profit is on your income, not your (income - expenses). If you do decide to make your purchase then make as an investment not as a personal purchase. You don't want to overpay and you don't want to purchase a difficult to rent and resell later property. Can you afford the hit when your fine tenants trash your stove or destroy the carpet. Interview your realtor, you are hiring them. Good luck!

Answer 4

Only if you believe the condo will appreciate in value during the year sufficient to offset (after capital gains tax is paid) the cost of purchase and sale (which are high). You also have to take into consideration that you might not be able to sell the condo and free your capital on the exact date you want to leave, but you can negotiate a lease with a pre-determined termination date. In this economy, I would probably rent.

Answer 5

Yes, if you can get a condo at the best location you still can rent it out after you move out from that town. Get a right agency to help if needed.

Normally, 2 months of deposit required from the tenant, Tenancy Agreement must be issued to the tenant as well.

Answer 6

No Not in this housing market. And if you decide to rent it after a year you may not be able to get enough rent to cover you mortgage payment and association dues. And selling it may be extremely difficult and costly.

IF YOU WERE TO BUY make sure its not a condo conversion.

K

Answer 7

If you can or renting it then not a problem. However if you plan on selling it check the mortgage penalties. there can be up to a 30 percent of the mortgage as a early out fee for the 1st 3 years

Answer 8

Well, just because you buy a place doesn't mean you have to live in it! I'd say if it'll give you a roof over your head and turn into a nice investment down the road... GO FOR IT!!!

Answer 9

All depends on the golden rule...Location, Location, Location. Don't do it if you are getting financing, you will lose money on all the closing costs. If you will be paying cash and it's in a great location then no worries, go for it.

Answer 10

Only if you can be reasonalbey assured that the property value will increase, and you cannot depend on that. Anything less, and you will lose far more than if you just rented.