YART: Fiance wanted to buy a "new" condo instead of renting

[CTrain]

Originally posted by: vladgur

Originally posted by: CTrain


So for him to break even by buying, the HOUSE needs to appreciate ~$50K in 2 yrs.
Will his house appreciate $50K in 2 yrs ?? Probably....probably not since the market in SF is at an extreme high right now.
Nothing is certain

Youre talking about $600k house appreciating at least $25k a year thats a 4% increase a year on a house in Bay Area. This is not only probable, its certain. Did you know that in Santa Clara County, which is the heart of Sillicon Valley, a median house makes $90k while the average person makes $78k a year?

Sorry, nothing is certain.
Putting money in a bank account and getting 4% -5% is certain.
Knowing for sure a house would appreciate is not certain.
You act like a housing bubble have never happenned before...it has happenned and it could again.

If I had to bet, yeah, I'd say his house would appreciate beyond the $50K but its still a risk.
My only point was that I hate people chiming in and all they can say is "renting is throwing money away".

 

[desy]

Not me buddy
Renting is perfect in some situations.
I have a house, but I want the privacy it offers cause I have a wife and kids and can afford to do so.

 

[Zap]

Originally posted by: PandaBear
don't mind renting for a couple of years to wait for more down payment or the housing price to drop.

If you don't mind renting for a few years, why not buy a cheap condo for a few years? Nothing says you have to live there the rest of your life, just find a place that is affordable. See it as temporary housing.

Originally posted by: her209
I wonder what the ROI is on your own strip club? Hmmmm...

You need to start with a few hundred thousand and a lawyer...

Originally posted by: Whoozyerdaddy
My advice is to aim lower. MUCH lower. An additional piece of advice is to not even think about buying a place together before you are married.

Can't really say about buying before getting married because... don't know how strong your relationship is. Aiming lower is good advice.

Originally posted by: PingSpike
Personally, I'd rather buy a new condo then an old house. And I don't want a condo. But that old house is just going to keep falling apart all the damn time. Even if you can afford it, constant repairs are a pain in the ass.

I've lived in some older places, and yes there will be things breaking.

Originally posted by: mugs
It makes me wonder why people are so reluctant to move out of California and so willing to live IN California. Any time a real estate thread pops up here, the Californians jump in with how much it costs to live in California.

It's just that many places in CA are pretty nice, but yeah I hear ya. I recently moved to WI and a friend of mine is moving to somewhere in TX. He's having a house built with the proceeds from selling his CA house - will be completely paid for and custom built to specs.

I'd say to buy a condo, but find a cheaper one. Being a first time buyer can be a pain, but once that's over with, the next buying experience will improve. My non-professional recommendation is to find a condo that is low priced enough and see what monthly will be with a 30 year fixed. Don't fall for those new-math mortgages such as interest only, because that's risky when the market may or may not be at a peak. With renting at $1000/mo, I don't think a worst case scenario for buying would have you lose much more than $24,000 over two years, plus your next mortgage will be easier to get.

 

[vladgur]

Originally posted by: CTrain

Originally posted by: vladgur

Originally posted by: CTrain


So for him to break even by buying, the HOUSE needs to appreciate ~$50K in 2 yrs.
Will his house appreciate $50K in 2 yrs ?? Probably....probably not since the market in SF is at an extreme high right now.
Nothing is certain

Youre talking about $600k house appreciating at least $25k a year thats a 4% increase a year on a house in Bay Area. This is not only probable, its certain. Did you know that in Santa Clara County, which is the heart of Sillicon Valley, a median house makes $90k while the average person makes $78k a year?

Sorry, nothing is certain.
Putting money in a bank account and getting 4% -5% is certain.
Knowing for sure a house would appreciate is not certain.
You act like a housing bubble have never happenned before...it has happenned and it could again.

If I had to bet, yeah, I'd say his house would appreciate beyond the $50K but its still a risk.
My only point was that I hate people chiming in and all they can say is "renting is throwing money away".

The housing bubble is a theme that is being recycled by the policy makers to push their agenda left and right. In the hot area such as Bay Area, where 30% house price increase are not unheard of, even an UNPRECEDENTED 25 % price decline will not be a problem to anyone who can hold on to their property for more than a year.
So the only think that would happen during the housing market bubble is that the price increase will slow down(over few years that is).

And i agree with you, renting is not throwing money away if you can manage your finances right.

 

[Metron]

Originally posted by: AgaBoogaBoo

Originally posted by: Cattlegod
haha 600k for a beater.

lol, that would buy you a castle in michigan.

same here in Indiana!

Half that ($300,000) will buy you a McMansion in the nicer suburbs north of Dallas (Plano, Frisco, Allen, Highland Village, ...)

 

[xgsound]

I've noticed that several people commented that if you're fighting about money now your compatablity prospects are poor. If you're screaming or punching each other in the face they are probably right.

If you're only raising your voices they're totally wrong. To get to that point you have already passed by the all important first step of talking about money at all. It seems as if most families say nothing about money and spend until they're up to thier eyeballs in debt. Then that's all they talk about. It also seems that you two do not intend to be one of those families. It sounds like you're on a good track to me.

Nobody says it's easy or painless, but it's required effort for a good outcome. Keep saving money and arguing it out . The longer it takes the more money in the pot for a world cruise, a change of location, a new house or anything else you two agree on.


Jim

 

[PandaBear]

Originally posted by: xgsound
I've noticed that several people commented that if you're fighting about money now your compatablity prospects are poor. If you're screaming or punching each other in the face they are probably right.

If you're only raising your voices they're totally wrong. To get to that point you have already passed by the all important first step of talking about money at all. It seems as if most families say nothing about money and spend until they're up to thier eyeballs in debt. Then that's all they talk about. It also seems that you two do not intend to be one of those families. It sounds like you're on a good track to me.

Nobody says it's easy or painless, but it's required effort for a good outcome. Keep saving money and arguing it out . The longer it takes the more money in the pot for a world cruise, a change of location, a new house or anything else you two agree on.


Jim

Our "fighting" is merely trying to convince each other, and trying not to be convinced by each other. No voice raising, no physical fight, no name calling, just "I am disappointed because of this." and not talk to each other for a day. Very compatible in any standard out there.

As I said again, she is naive in finance so my training for her is to tell her to go look at housing herself, and do the math herself. Her defense is "my bro made much less than we combined and he could afford a condo, my parents make much less than us, and they could afford a house. So your math must be wrong somewhere." and completely ignore the closing price, equity, interest rate, and timing.

I'll keep you guys updated on the progress.

 

[MustangSVT]

ITB is all i can say, ITB...

 

[spidey07]

Originally posted by: PandaBear

Originally posted by: xgsound
I've noticed that several people commented that if you're fighting about money now your compatablity prospects are poor. If you're screaming or punching each other in the face they are probably right.

If you're only raising your voices they're totally wrong. To get to that point you have already passed by the all important first step of talking about money at all. It seems as if most families say nothing about money and spend until they're up to thier eyeballs in debt. Then that's all they talk about. It also seems that you two do not intend to be one of those families. It sounds like you're on a good track to me.

Nobody says it's easy or painless, but it's required effort for a good outcome. Keep saving money and arguing it out . The longer it takes the more money in the pot for a world cruise, a change of location, a new house or anything else you two agree on.


Jim

Our "fighting" is merely trying to convince each other, and trying not to be convinced by each other. No voice raising, no physical fight, no name calling, just "I am disappointed because of this." and not talk to each other for a day. Very compatible in any standard out there.

As I said again, she is naive in finance so my training for her is to tell her to go look at housing herself, and do the math herself. Her defense is "my bro made much less than we combined and he could afford a condo, my parents make much less than us, and they could afford a house. So your math must be wrong somewhere." and completely ignore the closing price, equity, interest rate, and timing.

I'll keep you guys updated on the progress.

You are in for a world of hurt.

Seriously.

 

[PandaBear]

Originally posted by: spidey07

You are in for a world of hurt.

Seriously.

Huh? what do you mean?

 

[spidey07]

"As I said again, she is naive in finance so my training for her is to tell her to go look at housing herself, and do the math herself. Her defense is "my bro made much less than we combined and he could afford a condo, my parents make much less than us, and they could afford a house. So your math must be wrong somewhere." and completely ignore the closing price, equity, interest rate, and timing. "

That should be a HUGE red flag. Not speaking to each other and teaching a lesson? WTF?

I don't want to meddle, but everything about this just seems so wrong. You both need to get your head out of the clouds. You're falling for the "I just graduated college and am making the BIG bucks and should live accordingly and compare myself amongst my peers and family."

To put it bluntly, you guys don't make a lot of money and even looking or thinking about 500K houses is absurd. Basically I'm saying you have every single indicator of a starter marriage.

 

[PandaBear]

We do speak to each other, but weren't doing so for one day because we are both about to blow up. That one day is a cooling period and re-evaluate our own positions. At the end of the day I decided that the house is not everything and I should be considerate to her dislike of the place (I spend 3 hours there, 1 in the morning, 1 in the later afternoon, and 1 at around 9pm to see how good is the neighborhood, whether it is ghetto, etc, talk to residents, survey, etc). She came to the conclusion that if I really insist she could try living there but definitely not for the rest of her life.

I told her about my "training", walk her through newspaper ads and the online mortgage calculator, and match up what can we afford vs what does she like to live in. It is not a retaliation and "teach her a lesson".

But yeah, you are right about the red flag and I will keep that in mind, thanks for the heads up.

 

[Stuxnet]

Originally posted by: spidey07
"As I said again, she is naive in finance so my training for her is to tell her to go look at housing herself, and do the math herself. Her defense is "my bro made much less than we combined and he could afford a condo, my parents make much less than us, and they could afford a house. So your math must be wrong somewhere." and completely ignore the closing price, equity, interest rate, and timing. "

That should be a HUGE red flag. Not speaking to each other and teaching a lesson? WTF?

I don't want to meddle, but everything about this just seems so wrong. You both need to get your head out of the clouds. You're falling for the "I just graduated college and am making the BIG bucks and should live accordingly and compare myself amongst my peers and family."

To put it bluntly, you guys don't make a lot of money and even looking or thinking about 500K houses is absurd. Basically I'm saying you have every single indicator of a starter marriage.

I think this is terrible. Money is the sore spot in most marriages to begin with... there's nothing out of the ordinary here. Specifically, home buying stresses a marriage more than any other factor, including having kids.

PandaBear's situation doesn't appear to be any different than any other normal couple. My wife and I have what I would classify as an outstanding marriage, but we had our fair share of fighting when we bought BOTH our first AND second home.

If you found someone who is so compatible with you (or is just a doormat) that you don't have any disagreement whatsoever when buying a home then good for you... but I'd imagine life would be pretty boring that way.

PandaBear, I may not agree with your particular stance (spending $500,000 on a home in your situation), but there's nothing wrong with the fact that you guys are in disagreement and "fighting" about. Congratulations: you're normal.

 

[KristopherKubicki]

While I can't speak for the bay area, real estate in general is screwed up right now. People are buying $600k homes on $12k down with insane financing and expecting the real estate market to sustain itself forever. I could buy right now, but I rent because I know that a one bedroom in chicago isn't worth $350k. I haven't seen the property you are interested in to make a decision, but step back a bit and ask yourself what the resale value on that property is going to be in 5-10 years --- and then make sure you can get that.

Kristopher

 

[bigredguy]

Lemme get this straight. The most you feel comfortable spending is $600k, and you're butt hurt about her not letting you bid on a $620k house that needed $30k+ worth of work? I must be missing something...

My advice is to rent a 1k place for a while for a few reasons.

1) You're not married and sh!t happens and people change.
2) Housing market in coastal california cities sucks right now, wait it out, it can't get worse(can it?)
3) renting at 1k you'll be saving about 1.5k a month so unless you hang onto the house for a long time, you're gonna have a hard time making more money than that 1.5k saved every month.

Just my $.02, gl


final note, DON'T GET MARRIED UNTIL YOU HAVE LIVED TOGETHER FOR ATLEAST A YEAR! Everything, and i mean everything, changes when you are under the same roof 24/7

 

[PandaBear]

Originally posted by: bigredguy
final note, DON'T GET MARRIED UNTIL YOU HAVE LIVED TOGETHER FOR ATLEAST A YEAR! Everything, and i mean everything, changes when you are under the same roof 24/7

That would be hard, she and her parents are kind of traditional and she is not willing to "bend the rules of the family".

When she goes to grad school out of town, I pretty much spend every other weekend with her, does that count as living under the same roof 247?