Buying vs. Renting-Woulda, Coulda, Shoulda

FH and I will be moving in together after the wedding. I live on my own, FH still lives home. Suffice to say, he is saving some $$ while I am lucky if I put a nickel away.

Anyway, we are torn.. Do we buy something, and struggle for a while? Shoud we rent, and save some $$. PS, we are not in the lucrative fields. I am a social worker, he is NYPD.

Can anyone share some hindsight with me?? does anyone wish they would have done things differently??

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

I say if you can buy, buy. You find a way to pay. Your income should grow into your mortgage. The tax benefits alone make it worth it. Good luck with whatever you decide.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

If it is at all possible to buy something I would. I have friends that can not get out of renting, because they cant afford to save up money!

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

We bought as soon as we could. We both live at home now (our closing on our house in July) and my fear was that if we rented we would not be able to save much more than we have now anyway.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

We didnt have much money either, but decided to try and buy something instead of wasting money on rent. I would definately meet with a mtge broker (I have a great one if you need) and see what you can afford. With the interest rates the way they are and all the programs available, you could probably put very little down and finance closing costs. But, definately meet with a broker (usually they dont charge for this or the pre-approval) before making this final decision. JMO.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

I say, make a budget before you do anything. See how much you can afford to spend per month on housing, whether mortgage or rental.

DH and I rent. We can EASILY purchase a home right now and pay a mortgage. What I am not so sure about is whether or not we can pay a mortgage plus any necessary home repairs, maintenance, etc- I do not want to be painted into the corner and get evicted!

I say be better safe than sorry- if it's the first time you're living together, maybe rent for a year. You certainly would not be 'throwing the money away' as people make it seem if you are learning how to live together, budget two salaries, etc.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

I agree with Sassy. I feel like life is a lot easier with us renting. We could buy the house but I never want to be 'house-poor'. I want to have money to live. DH and I agree that buying a house can be a lot of added pressure if you are not ready.... on me to cook each night to save money, on me to clean a much larger house than our current one bedroom, on us to make payments for renovations, insurance, mortgage, lawn, etc... This could also affect a marriage with the new pressures if people are not ready. Because I want this to be as convenient and stress free as possible, we are waiting.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

DH and I are in the same boat as Sassy and Sept20. We could probably afford the mortgage payment, but we couldn't afford anything else. And God forbid if there was something that needed to be replaced!

We would rather rent for now and continue to save, and with DH going back to school, we will continue to rent until he is done next year.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

These responses are exactly why i posted this. Im afraid that if we go buy a house, a little one at that, we wont be able to go away, do some shopping etc.

Time will tell

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

I think people who shouldn't buy are 'rushing' into it b/c of the low mortgage rates. I'm afraid for a lot of my friends who have put next to nothing down, have a PMI and a very high monthly morgage payment. They are up against the wall and would def. have MAJOR problems should anyone lose a job, get sick, etc... I dont want to put DH and myself in that position...

Keep in mind prices are VERY high, and prices are cyclical. If you aren't going to buy a place and stay in it long enough to deal with any eventual downturn (lets remember the late 80s housing bubble- I think it's possible to happen again since nothing goes up forever) you could possibly find yourself stuck with something you cannot sell.

However, if you are buying something to hang onto forever, then you'd be fine in the face of a downturn or market correction.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

The housing market on LI is crazy. Prices may level off but they will not drop. Land is scarce so it drives the cost up and Long Island is a desirable place to live. We have the North shore, Soth shore, The Hamptons and Manhatten both a stones throw away. There are also jobs here. If you could buy without overextending yourself than I would say to do it but if there is any concern of having to work for your house, or being house poor, you should wait. Renting for a reasonable price is not throwing away money if you are working on a larger goal!! Good luck!

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

due to the unbelievable cost of living on LI, we are leaving....we are going to get a house the size of the new construction they are building for about 1/3 the cost. What you get for $500,000 up here, we'lll be getting for $195,000 down south. Most of our friends are gone or leaving also.....plus living up here is not conducive to the lifestyle we want

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

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Posted by philby

The housing market on LI is crazy. Prices may level off but they will not drop. Land is scarce so it drives the cost up and Long Island is a desirable place to live. We have the North shore, Soth shore, The Hamptons and Manhatten both a stones throw away. There are also jobs here. If you could buy without overextending yourself than I would say to do it but if there is any concern of having to work for your house, or being house poor, you should wait. Renting for a reasonable price is not throwing away money if you are working on a larger goal!! Good luck!

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In the late 80s the same housing market (Long Island) dropped. My father bought his house then- about 88-89 a new build- for $360 (THEN! In Commack) and it fell to $280 in 2 years... so it certainly is possible.

The housing market in the entire United States has been going up, I don't think Long Island is 100% isolated from market shifts, although it could protect us from anything dramatic.

to think something goes up forever is naive.. you can never think that. In the long run, yes- you can thing that- but I think you still have to be very wary of cycles whether in housing or stocks- nothing with money is EVERY guaranteed.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

FH and I have a condo. For now there is no hurry for a house - for many of the reasons that the other ladies mentioned. The biggest one being we don't want to be 'house poor' - when FH and I do something we want to do it completely right. So when/if we get a house that means they'll also be money to furnish it plus there will be $ for our lifestlyle (vacations, dinners, etc)

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

This is just my experience...
We moved into an apartment in the year 2000 for two reasons (we thougt at the time were very smart) to save money and wait it out till the home prices came down -
We had some money at the time to buy but thought this was a better idea.
Well we saved about 30,000 more dollars - we bought our house two years later and paid at least $100,000 more than if we had bought it two years earlier - so much for our $30,000 -
However, 8 months after we bought that house we sold it for a small profit - moved only a few blocks away.
So in my experience it's best to buy - vs. renting - (if you have the money to buy I would at least go and look)
I read the real estate sect. every week - and I don't see home prices coming down - but I do see interest rates going up... and therefore let's just say you buy in two years from now the price of the house might be around the same - but those interest rates make a huge difference -
the reason we were able to sell our house and buy a more expensive one (the intererst rates) we bought a house for about $100,000 more but b/c of the interest rates being so low we are paying about the same in our morgage payment each month.
Again, just my opinion.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

I'm not saying buying a home is a bad idea.

I do think, however, that buying a home like one would by stocks as a 'day trader' of the 1999-2001 economy can be dangerous! And honestly, I think when you buy and sell every 2 years, it is akin to 'day trading' houses.

If you buy a home and live in it for 10-20 years.. who cares WHAT happens to the value up or down- b/c in all honesty it could possible go up or down 3 or 4 times in that period, but at the end of the day, it will be more than what you paid for it.

I just get nervous when I see my friends buying homes with 2% down and an insane monthly payment that can put them over the edge when combined with any normal and possible disaster (illness, laid off, toilet breaking, etc).

I have a lot of friends who have bought a home, tell me I'm stupid for renting, but can't save a dime and are in CC debt b/c they are fixing the house up like Bob Villa!

If you aren't ready, you aren't ready- but I think this market 'hysteria' coupled w. the low interest rates has tempted people to buy that shouldn't be buying yet.. that with the fact that banks are giving mortgages to people who probably shouldn't get them.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

my fi are in the same boat. neither of us really want to rent, but we are not sure what we can do. we are meeting with a mortgage broker on thursday to see what we can get and how much we can afford. if we find a house great, if we don't then we will have to rent.

the most important thing is to be realistic. we both realize that if we had a house we wouldn't be able to do a lot of the things we do now, at least for a little while. we both have supportive families that will help us in various ways. we will definitely need a 'fixer upper' luckiily i have handy men around. we would do the necessities and gradually work on the rest.

my parents seem to think that we can do it. it is going to take more to convince me.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

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Posted by VickiC

DH and I are in the same boat as Sassy and Sept20. We could probably afford the mortgage payment, but we couldn't afford anything else. And God forbid if there was something that needed to be replaced!

We would rather rent for now and continue to save, and with DH going back to school, we will continue to rent until he is done next year.

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I did similar. Before DH and I got married, we moved in together to save money (we were both renting our own apartments at the time). We did this for about a year and stayed there close to a year after we were married to save more money. Although we could have afforded a house when we got engaged, we knew if we waited just a little bit more we could afford more of what we wanted. We rented a modest apartment (we could have afforded a bigger and better place) which allowed us to save more money towards the house and still enjoy a fun lifestyle. We also didn't go crazy furnishing and decorating the apartment since we new it was short term and it may not work in a house when we eventually bought. We stayed in my apartment - which on my salary I could pay myself including bills and used DH's salary for saving and fun. It worked nicely for us. Believe me, when you finally buy - a house is a lot of money and work - more than we thought. even though we have money saved - it goes much quicker than you can imagine.

Re: Buying vs. Renting-Woulda, Coulda, Shoulda

We didn't think we could buy a house this soon but w/ interest rates so low when we locked in, we decided to go for it. Our mortgage is alot less than we had thought it would be because we arent paying PMI. We did 2 loans to avoid PMI which made our martgage alot less. We bought a house that wasn't too expensive also. We figured we should do it now cause if the house prices go up or the interest rate goes up (which it has been going up), we would never be able to afford a house so we went for it and I am so excited we did. Good Luck!!!!