Buying a house

[Zamdrist]

There was a time when buying a house, as an investment was a myth...true or false?

Is this still true or false?

Does it largely depend on the market, I mean the region?

I am completely ignorant in this area.

Girlfriend and I went looking at houses, it was a strange experience.

 

[Spinaroonie]

Its mostly false. IT all dependso n your motives. If you plan on selling it, and I mean really plan on selling it, then it's an investment.

Otherwise, it's a liability. If you get too emotionally attached to the house then it's just a big money pit, you won't sell it, too many memories or soemthing.

 

[Zamdrist]

Its mostly false. IT all dependso n your motives. If you plan on selling it, and I mean really plan on selling it, then it's an investment.

Otherwise, it's a liability. If you get too emotionally attached to the house then it's just a big money pit, you won't sell it, too many memories or soemthing.

Thanks. Turn on your word wrap dude, that's messed up.

 

[Spinaroonie]

Thanks. Turn on your word wrap dude, that's messed up.

It's fallout from having the brilliant sig

Oh, and another thing, the man is going to be
stereotypically better at being able to sell the
house because of him being less emotionally
attached. With a son, that may be hard.

HOWEVER

If the relationship with the girlfriend goes south
and not in some oral sex kind of way
then it may be a whole lot easier.

 

[Zamdrist]

If the relationship with the girlfriend goes south
and not in some oral sex kind of way
then it may be a whole lot easier.

We shall see where the relationship stands after I have the vasectomy

That's a whole different thread...lol

 

[ksmybuttons]

It's fallout from having the brilliant sig

You were suppose to keep your creation in it's own thread, remember?

 

[alexandraaah]

It depends less on the market than the location, as the market is always fluctuating. Interest rates are low now, and slated to go lower, I believe, but this will always change over time.

Real Estate is almost invariably a solid investment, given you have the time and money to sit for a while.

If you're looking for a place to live and settle down, buying is obviously the thing to do.

If you're simply looking for an investment, get to know the neighborhoods...what's changing and how.

If you're looking for both, then combine the above.

Good luck!

 

[Monazwx]

Hi Zam,

I'm not too sure what you're asking here. But like SD412 says, it does depend on if and when you decide to sell. Real estate can be a profitable investment. However, I wouldn't leverage (that is borrow money to invest in real estate). Losses are magnified, although returns can be quite sweet. This is a big step.

Also, are you planning on buying the house outright to gain equity for if you need a loan or refinancing some day? Or are you planning on buying a "fixer-upper" to sell for profit?

Regardless of what you plan to do, here's some stuff to think about.

If the area is close to a good school and or facilities, the land/house will probably cost more. It's all location, location, location. Make sure your realtor is with the National Association of Realtors. Always get the house inspected by a licensed building inspector before purchase. An attorney may also be a good idea when reviewing the contact. I hear that co-op sales contracts are non-contingent, which means that your deposit is forfeited if the deal doesn't go through so be careful with that.

Don't get me started on House Insurance.
Good luck and Toodles!

Mona.

 

[Monazwx]

Yes, I have more to say.

What a co-incidence to have found this. Hope it helps.
http://moneycentral.msn.com/articles/banking/basics/9068.asp

 

[Zamdrist]

Yes, I have more to say.

What a co-incidence to have found this. Hope it helps.
http://moneycentral.msn.com/articles/banking/basics/9068.asp

Thank you!

My Dad says buying a house as an investment is a myth. Of course, he hasn't looked into buying a house for many, many years...also we all know our parents don't know anything.

 

[callableborg]

Zamdrist

Have recently bought a home myself. From the point of view of a renter it is a good investment indeed.

If you rent you have a roof over your head each month but the money passes to other hands. If you own the money {i.e. morgage payment } goes toward purchase, thus into your own pocket. Each month you are ahead roughly the amount of a monthly rent payment.

If you live in an area where the population is projected to increase you are even better off as there will be a natural upward pressure on housing prices. More people therefore an increased demand for housing.

What the investment value of a second house would be is pretty complicated. The first though is very good as it eliminates the monthly loss in rent.

 

[Zamdrist]

callableborg, thanks...

Let's say you buy a house for $180,000 just to throw out a number.

The mortage would be what? About $1500?

Let's say you keep the house for 10 years and sell.

Depending on many factors, the house could be worth up to $250,000 right?

Ok...so 10 years of $1500 mortage payments:

$1500 x 12 x 10 = $180,000

$250,000 - $180,000 = $70,000

Not including property taxes, I guess that's a good return. Or all my numbers screwed up?

 

[ExLimey]

Most real estate will appreciate over time if kept in good shape. I live in an area where only the locals know about, not a huge demand for housing. I bought my house in '95 for $25,000 and it was just reappraised at $57,000 last month. All I've done to the property is mow the grass, new garage doors and redone the kitchen (myself, new floor, counters, wood walls & wallpaper. Same old cabinets).

Houses in more urban areas would probably appreciate faster than that. Draah is right, interest rates are low now and expected to go a little lower (not much). I was quoted 6.375% on a 30 year Freddie Mac loan last week. My home equity loan which I just got to do some improvements is at 5.75%.

As someone else stated, if you're buying this with your gf you need to make sure you have some legally binding agreement in place should your relationship end. It could get real ugly fighting over a house (not to mention expensive)

Oh, and if you find a house you like, pay the $300-$500 to have it inspected. The inspector will work for you and not the seller and will give you a report on all aspects of the house, mechanical, exterior etc etc. It's well worth it to protect yourself.

 

[ExLimey]

Oh yeah, forgot a couple of things.

Talk to a lender now and get pre-approved for a mortgage. That way you'll know how much of a house you can finance. Also, take a hard look at your budget to find out how much house you can afford each month. JUST BECAUSE THE BANK WILL LEND YOU THE MONEY DOESN'T MEAN YOU CAN AFFORD THE PAYMENT!!

Check with HUD. See if they have a list of HUD homes in your area. They'll be repos, cheaper but may need some work.

 

[Zamdrist]

As someone else stated, if you're buying this with your gf you need to make sure you have some legally binding agreement in place should your relationship end. It could get real ugly fighting over a house (not to mention expensive)

LOL...that's what was so weird about it. She has plans to buy a house whether she has someone in her life or not. And we've just met since the 4th of July.

I'm certain she would like to combine her money with someone else, married or not, to get a better place.

Nothing is going to happen in that magnitude for quite awhile, lol.

 

[MacCortz]

There was a time when buying a house, as an investment was a myth...true or false?

Is this still true or false?

Does it largely depend on the market, I mean the region?

I am completely ignorant in this area.

Girlfriend and I went looking at houses, it was a strange experience.

Yes and no, you are asking a question that requires a view into the future. at this time I would think that investing in a home is good.... however I have lost my ass beyond homes in other investments that i thoght were great too,,,,,,,, throw the dice if you get the right number ............... look at the information and do what you think is right and it will be or ...... not

 

[T.H. Oughts]

A house is an investment only for when you retire and have it paid off. If you are still renting when you retire you still have weekly payments. That is about the only real investment a house can be...

I know of many that have bought the worst house in the best street to do it up and make money. But when they have come to sell the market has been lower than expected and they have not made any money to progress up the house ladder.

The main thing these days is being able to afford your morgage on one wage if you have a partner. If you have a child and one stops working, or you loose a job then you have to afford the morgage and living expences on one wage....

 

[wizbit9]

There was a time when buying a house, as an investment was a myth...true or false?

Is this still true or false?

Does it largely depend on the market, I mean the region?

I am completely ignorant in this area.

Girlfriend and I went looking at houses, it was a strange experience.

i have just bought a house in my region.

U.K house prices at the moment are soaring.

my parents house is in the area and has gone up 30k in 1 year.

i ought as an investment property to make money on in the next couple of years

i bought a 4 bedroom property at 80k and has risen by 10k in 2months. (silly)

i am renting out 2 rooms for £160 a month all bills included which covers the £236 a month morgage and bills. me and my bro have the other 2 rooms rent free.

dont want money now just hope to make 20K in 5 yrs to give to our parents as a retirement present. (they dont know this detail yet )

 

[callableborg]

house

Your numbers look good to me Zamdrist.

Morage rates are low right now. I got 3.75% floating. Also possible that you can deduct the money you pay on morgage intrest from your taxes. Not sure of situation in the U.S.

Also there are online morgage/loan calculators. You can plug in various loan amounts - interest rates - terms and get a result in monthly payments. One I know for sure is on Yahoo Canada - finance.