I will be graduating from University this next May and would like to buy a house, condo, or loft soon after. I will be living by myself, but could see renting out extra rooms if I buy a house. I will be making about 45-50k a year at first as I am an accounting major. I would like to live in Portland, OR. First of all, what would be the better bet to buy, a house or a condo? (I've heard condos aren't good to buy due to home owners fees and maintenence). Also, is it ok to buy my own place right away next summer, or should I wait? I would really like to have a place to call my own and renting seems like such a waste of money...
2006-10-13 03:43:55 · 8 answers · asked by amy l 1 in Business & Finance ➔ Renting & Real Estate
I would wait until I could put 20% down if I were you. That way you can avoid mortgage insurance and you'll get a better interest rate.
Prices in very hot markets will drop some, but overall, I don't think they'll drop that much.
Renting generally is wasting money, but so is paying truckloads of interest on a mortgage. While renting, think of the property taxes you will avoid as well as association fees, garbage fee, some utilities, etc.
My wife and I rented for two years then bought a single family home. We put 20% down and are able to prepay our mortgage to get finished in less time and save on interest in the long run.
2006-10-13 03:52:10 · answer #1 · answered by IT Pro 6 · 1⤊ 0⤋
In my opinion, it is very smart to buy. You would be building up equipty in your home so if you ever sold it, you have a good chance of making a profit. Renting you have nothing but rent receipts. Whether you buy a condo or a house would be a matter of lifestyle and affordibility. If you are not going to have time or the interest in maintaining your home, a condo would probably be best. Before buying a condo, some of the questions to ask (1)is there a homeowners association that gets together to decide major financial obligations of the condos. (I would not even consider the condo if the homeowners do not decide the financial obligations. (2) what kind of power does the homeowners association have to enforce that every homeowner pays his fair share of the mutual obligations. (3) can I live with the restrictions that the homeowners association put on the condo, i.e. is there some restriction like "no pets", etc that you cannot or do not want to live with. I personally like a house; however, I do have to do or have done all maintenance on it. Right now, in most housing markets, it is a buyer's market. If I were you, I would start looking right now for the best balance between what I want and what I feel that I can afford. One of the other answers said to wait until you have 20% down so that you do not have "mortgage insurance". I disagree, in my lifetime, I have bought 8 homes and I have sold 7 of them. I never, again, want to live in a home owned by someone else, therefore, I feel that "mortgage insurance" is a good deal and if can be cancelled once you get enough equipty in your home. FYI; look into buying points on your home. Points is the interest rate, 1 point usually equalls about $1,000.00 and drops the interest rate, for example buying 1 point on a 6% mortgage would reduce the mortgage rate to 5%.
2006-10-13 04:02:10 · answer #2 · answered by bettyswestbrook 4 · 0⤊ 0⤋
As an accounting major you are on the right track. Owning vs renting is always better. Now the type of home you purchase is a personal decision based on your goals and lifestyle. Condo/townhouse generally are considered because you have no outside maintenance. Yes they typically have associations that maintain the grounds and such and there is a monthly fee for this service. That doesn't make them a bad buy. As to the time you decide purchase, again that's a personal decision. You would want to take into account, (no pun intended) the location of your job to a home. Drive time, gas mileage other amenities you might want in your everyday lifestyle. Entertainment, shopping, Movies, etc. You might consider this, if you know where you're going to work, then interview 3 Realtors the first part of next year (January). Select the one you feel most comfortable with and can trust. Have them show you a selection of condo/townhouses and single family in the area you will be working. Then you'll have a better handle on your needs as it relates to what might be available to purchase. Remember too, that financing can take 45-60 days to put in place, so it gives you plenty of time to make an informed choice. Good Luck!
2006-10-13 04:01:32 · answer #3 · answered by Anonymous · 0⤊ 0⤋
It is never too early to buy as long as you are in the position to do so. You DO NOT need to put 20% down to avoid PMI insurance, since there are several options to finance a home zero-down without PMI.
The big question here is whether or not you can afford the payment. Work with an expert who is helping you make the RIGHT decision. I may be able to qualify you for a million-dollar home, on paper, but only YOU know whether or not you can make the payment month-in, and month-out.
I will advise you, though, to make sure that you can continue to make your payments if a roommate moves out. If affording the home is contingent upon having roommates, you may want to reconsider.
As far as deciding whether to buy a condo or home, it greatly depends on your lifestyle. With a condo, you are not responsible for maintaining the exterior. This may be attractive to you if you are fresh out of college and starting a career.
Good luck!
2006-10-13 06:09:05 · answer #4 · answered by Justin 3 · 1⤊ 0⤋
Portland real estate has gone up rapidly in recent years and it seems to be stalling right now. With your income, you may have to go farther (distance from down town) than you want to be able to afford a house. The best is to rent a place by month to month or by 6 month lease (if it has to be one year, make sure the penalty of breaking it is not too high), and look for a place to buy. By taking time doing so, you may find a very good deal (like somebody desperately want to sell fast). Interest rate is not going to jump immediately, but there will be more inventories of resale homes/condos. Find an agent (who is not too busy) who is willing to spend time and work with you. Good luck.
2006-10-13 04:03:26 · answer #5 · answered by spot 5 · 0⤊ 0⤋
It's a catch-22... the longer you rent, the more you pay towards some else's mortgage... but the sooner you buy, the less time you have to save towards a downpayment on a house (and therefore more interest to pay overall).
We rented a condo for 8 yrs. The landlord wanted to sell it to us when we were ready to move and buy... hahaha... not a chance! I saw the probs with maintenance, repair, snow removal, etc! Not worth the headache.
Work out your numbers on a spread sheet :)
2006-10-13 03:56:25 · answer #6 · answered by mama_bears_den 4 · 0⤊ 0⤋
If your are an accounting major read this web site and see the writing on the wall and i am sure you see that prices will be dumping soon and dropping like a rock.
http://www.breakingbubble.com/index.htm
2006-10-13 17:05:36 · answer #7 · answered by Anonymous · 0⤊ 0⤋
i would wait. prices are expected to drop quite a bit over the next few months. especially if new home sales drop and its the slow time of the season.
2006-10-13 03:47:43 · answer #8 · answered by Metro City Comics 4 · 1⤊ 0⤋