Should we buy a new house or rent?
Asked May 9, 2008, 03:06 PM
We are in a dilemna. We currently need to move from the house that we are in (long story; basically, we just temporarily swapped homes with someone; but that's another story).
We have been looking with a realtor at houses on the market for sale. There are a LOT of houses, some are good deals, some aren't. My concern with buying a house is - what if we buy a house now (even at a great price), but the real estate market keeps getting worse and worse, and in a year or two, the house that we just bought is worth a lot less? On top of that, closing costs, etc. etc. add up. (even when the seller pays for closing costs, that usually means that he's not as flexible with lowering the price). And then just the usual costs of the upkeep of the house, etc. etc..
On the plus side, it would be OUR house (well, us and the bank! LOL); we wouldn't have to move again (I have moved 4 times in 2 years; AGHH), etc..
What about renting a house (with an option to buy).. It would save us the hassle of closing costs, etc. but the house is not really 'ours'... And we wouldn't be able to write off that wonderful (ha) mortgage insurance on taxes...
We could buy the house after 1 year (with an option to buy). But usually, homes that are for rent with an option to buy want a non-refundable down payment for the 'right' to purchase the price after a year. What if we hate it? And what if the person that we are renting from goes into foreclosure without any warning to us? There goes our non refundable deposit and our home!
Sigh... On top of that, I have 7 rental properties. 2 of the properties will be available to me in a month (but they are 2 of my best properties; great positive cash flow, and I should be able to rent easily when the time comes). On the upside, it would be my house already (no worries about getting a new mortgage, etc.). But one is a condo (a little small for us), and the other is a nice house, but it is a little far to go to work, and we will need to put about a few thousand dollars in it to paint and put new carpet in it). *The house already has a tenant in it, so I could leave her in there for a while and make a positive cash flow, AND not put new paint and carpet..
So we are just spinning our wheels... Any sane suggestions? Thanks for your input.
P.S. Please, as much as I enjoy everyone's opinions, I would appreciate input only from folks who are truly knowledgeable in the finance/real estate field. Thanks again!
Last edited by Arivera112; May 9, 2008 at 04:39 PM.