Comments on: It’s a Great Time to Buy Your First House http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm Building Wealth through Saving and Investing Sat, 20 Mar 2010 19:38:27 -0400 http://wordpress.org/?v=abc hourly 1 By: Coop http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-83857 Coop Sun, 24 May 2009 04:03:09 +0000 http://www.milliondollarjourney.com/?p=824#comment-83857 Thank you! Thank you!

]]> By: Coop http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-83855 Coop Sun, 24 May 2009 03:59:36 +0000 http://www.milliondollarjourney.com/?p=824#comment-83855 Thank you very much for your wise advice David. My husband and I discussed something very similar last night and decided that its best for us to wait two more years, pay off all of our debts (my student loan(from obtaining my Masters Degree)C and a little bit of his own debt) together over the next two years while putting in money to add to our down payment for a house in a couple of years. This way we will be debt free when we enter into our house purchase with a nicer down payment. Just means we have to get through another two years in a very materialistic town in Alberta with "big oil money" as the odd ones who continue to rent. But with a long term plan this is the best option for us. Thank you for breaking down some numbers for us. Best regards, Coop Thank you very much for your wise advice David. My husband and I discussed something very similar last night and decided that its best for us to wait two more years, pay off all of our debts (my student loan(from obtaining my Masters Degree)C and a little bit of his own debt) together over the next two years while putting in money to add to our down payment for a house in a couple of years. This way we will be debt free when we enter into our house purchase with a nicer down payment. Just means we have to get through another two years in a very materialistic town in Alberta with “big oil money” as the odd ones who continue to rent. But with a long term plan this is the best option for us. Thank you for breaking down some numbers for us. Best regards,
Coop

]]> By: DAvid http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-83791 DAvid Sat, 23 May 2009 16:49:46 +0000 http://www.milliondollarjourney.com/?p=824#comment-83791 Coop, The usual advice is to rent for short periods. Here are some numbers: A mortgage of $210,000 at 3% over 25 years would be about $993/ mo. plus all utilities and municipal taxes. In two years, you would have about $12,000 in equity, plus what ever the price of the house increased You will have closing costs on your house. Realtor fees in two years would be about 6% or $13,200. Plus you may have to wait to sell when you want to leave. If you put the difference between your rent, and your housing costs into a TFSA ($178 on mortgage + $150 for utilities & taxes) plus what ever you estimate closing costs and moving costs to be (say $5000), you could have an additional $13,000 to add to your down payment savings in two years. In my opinion, unless you expect the house you buy to increase by 15% or more in the next two years, renting is the more cost effective option. DAvid Coop,
The usual advice is to rent for short periods. Here are some numbers:

A mortgage of $210,000 at 3% over 25 years would be about $993/ mo. plus all utilities and municipal taxes.
In two years, you would have about $12,000 in equity, plus what ever the price of the house increased
You will have closing costs on your house.
Realtor fees in two years would be about 6% or $13,200.
Plus you may have to wait to sell when you want to leave.

If you put the difference between your rent, and your housing costs into a TFSA ($178 on mortgage + $150 for utilities & taxes) plus what ever you estimate closing costs and moving costs to be (say $5000), you could have an additional $13,000 to add to your down payment savings in two years.

In my opinion, unless you expect the house you buy to increase by 15% or more in the next two years, renting is the more cost effective option.

DAvid

]]> By: Coop http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-83676 Coop Fri, 22 May 2009 20:28:58 +0000 http://www.milliondollarjourney.com/?p=824#comment-83676 My husband and I are first time "contemplating" home buyers. We have been renting here in a small town in Alberta for 6 years and have seen our rent increase from $415/mth to $815 a month (not including power) for a one bedroom. We are told due to the nature of my husband's employement we can get a 3% interest rate, we have $10,000 for down payment and both have secure employment in the emergency services (gross family income $110,00). After reading all of these posts I am more confused than before. This is a scary venture for us and are currently looking at houses around $200,000-$220,000. We don't want to continue to throw our money into somebody elses morgage by paying rent, yet we plan to relocate in about 2 years from now. I would love feedback from anyone about wether this is a good time for us to buy. Thanks My husband and I are first time “contemplating” home buyers. We have been renting here in a small town in Alberta for 6 years and have seen our rent increase from $415/mth to $815 a month (not including power) for a one bedroom. We are told due to the nature of my husband’s employement we can get a 3% interest rate, we have $10,000 for down payment and both have secure employment in the emergency services (gross family income $110,00). After reading all of these posts I am more confused than before. This is a scary venture for us and are currently looking at houses around $200,000-$220,000. We don’t want to continue to throw our money into somebody elses morgage by paying rent, yet we plan to relocate in about 2 years from now. I would love feedback from anyone about wether this is a good time for us to buy. Thanks

]]> By: Victor http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-83587 Victor Fri, 22 May 2009 09:14:40 +0000 http://www.milliondollarjourney.com/?p=824#comment-83587 A quick question for the lot of you: I live in Ontario and I bought my first home in January 2007. I chose to use the Homebuyer's Plan offered by the government to finance part of my downpayment. As I understand it, I should have received papers from the government telling me how much to pay back and when to pay it back. It is now May 2009 and I have received nothing. Can anyone comment? Thanks! A quick question for the lot of you: I live in Ontario and I bought my first home in January 2007. I chose to use the Homebuyer’s Plan offered by the government to finance part of my downpayment.

As I understand it, I should have received papers from the government telling me how much to pay back and when to pay it back.

It is now May 2009 and I have received nothing.

Can anyone comment? Thanks!

]]> By: Voice_of_Reason http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-75838 Voice_of_Reason Thu, 02 Apr 2009 19:07:03 +0000 http://www.milliondollarjourney.com/?p=824#comment-75838 I read this post and finally decided to reply for the very first time on this site. I currently rent in Toronto and am in the market to buy a condo. I have seen a lot of arbitrary arguments and comments so far. Here are some of the facts, since I have very raw data. archanfel, Ed Rempel, I am going to challenge your numbers a bit. My friend was just approved for a 4% 5 yr fixed mortgage with Scotia bank. On a 250K mortgage, using a 25 yr, the monthly principal+interest payments are ~$1300. Average property tax is $100-150/month for 1 bedroom condo downtown. Average condo fees (the ones I have seen anyway) including Hydro are $250-300. If you do the math: 1300+150+300=$1750. Since I have done the research, in the same building where I'd want to buy, I can rent for approx $1450-1500/month. Based on this you can buy a condo with an additional $250/month on top of your rent. Assumptions: 20% down to avoid the CMHC charges, 4% 5 yr fixed (although, my friend has informed me that some other institutions are offering as low as 3.82% for the same product which would bring the P+I payment down to $1270/month). The lower interest rates make a HUGE difference, you can't discount this fact. Buying due to lower interest rates DOES make sense (see the math above). Mind you, this rate is only locked for 5 yrs, after the 5 yrs I'd personally go for a variable mortgage rate, at which point time the sub-prime variable rates will likely return. The ONLY reason I would even consider touching the 5-yr fixed is due to the historically low rate compared to variable. You'd have to have completely lost your mind to lock into anything more than 5 years. Some of the numbers you used for interest rates are either out of date or are not representative of the best rate you can get these days. Eventhough I believe that condo/house prices may yet drop further, you will see substantial savings through lower rates. Moreover, Toronto is not Calgary and Vancouver. The house/condo increases in Toronto have been more steady and based on sound market economics. I would not be buying into the Calgary, Edmonton or Vancouver bubble. (See the CMHC average house price increase over the last 30 years for various Canadian cities). Also, Toronto is home to 100,000 new immigrants every year, the most in the country. The demand for housing should remain for the forseeable future. I read this post and finally decided to reply for the very first time on this site. I currently rent in Toronto and am in the market to buy a condo. I have seen a lot of arbitrary arguments and comments so far. Here are some of the facts, since I have very raw data.

archanfel, Ed Rempel,
I am going to challenge your numbers a bit.

My friend was just approved for a 4% 5 yr fixed mortgage with Scotia bank. On a 250K mortgage, using a 25 yr, the monthly principal+interest payments are ~$1300. Average property tax is $100-150/month for 1 bedroom condo downtown. Average condo fees (the ones I have seen anyway) including Hydro are $250-300. If you do the math: 1300+150+300=$1750. Since I have done the research, in the same building where I’d want to buy, I can rent for approx $1450-1500/month. Based on this you can buy a condo with an additional $250/month on top of your rent.
Assumptions: 20% down to avoid the CMHC charges, 4% 5 yr fixed (although, my friend has informed me that some other institutions are offering as low as 3.82% for the same product which would bring the P+I payment down to $1270/month).

The lower interest rates make a HUGE difference, you can’t discount this fact. Buying due to lower interest rates DOES make sense (see the math above). Mind you, this rate is only locked for 5 yrs, after the 5 yrs I’d personally go for a variable mortgage rate, at which point time the sub-prime variable rates will likely return. The ONLY reason I would even consider touching the 5-yr fixed is due to the historically low rate compared to variable. You’d have to have completely lost your mind to lock into anything more than 5 years.

Some of the numbers you used for interest rates are either out of date or are not representative of the best rate you can get these days. Eventhough I believe that condo/house prices may yet drop further, you will see substantial savings through lower rates. Moreover, Toronto is not Calgary and Vancouver. The house/condo increases in Toronto have been more steady and based on sound market economics. I would not be buying into the Calgary, Edmonton or Vancouver bubble. (See the CMHC average house price increase over the last 30 years for various Canadian cities). Also, Toronto is home to 100,000 new immigrants every year, the most in the country. The demand for housing should remain for the forseeable future.

]]> By: J. http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-75396 J. Sun, 29 Mar 2009 14:50:12 +0000 http://www.milliondollarjourney.com/?p=824#comment-75396 Thanks, DAvid. Thanks, DAvid.

]]> By: Alexandra http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74923 Alexandra Wed, 25 Mar 2009 19:14:14 +0000 http://www.milliondollarjourney.com/?p=824#comment-74923 My husband handles the finances in our family, and when we bought our Toronto house last year, he insisted on paying as little in terms of down payment as possible. We have a 40 year mortgage. He wanted to invest the difference (we could have afforded to pay way more down). He also wants to use the interest we pay on the mortgage as a tax write-off since he has a large home office (w/ it's own bathroom, basically 25% of our living space) and we also have a renter in a basement apartment. Does this make financial sense, or should I be insisting that we pay down some of our mortgage? We currently owe $550k in mortage (we both make about 100k each). He does tend to be more of a risk taker than I am, but this has served us well in the past ;-) Thanks for any answers. My husband handles the finances in our family, and when we bought our Toronto house last year, he insisted on paying as little in terms of down payment as possible. We have a 40 year mortgage. He wanted to invest the difference (we could have afforded to pay way more down). He also wants to use the interest we pay on the mortgage as a tax write-off since he has a large home office (w/ it’s own bathroom, basically 25% of our living space) and we also have a renter in a basement apartment.

Does this make financial sense, or should I be insisting that we pay down some of our mortgage? We currently owe $550k in mortage (we both make about 100k each). He does tend to be more of a risk taker than I am, but this has served us well in the past ;-)

Thanks for any answers.

]]> By: DAvid http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74816 DAvid Wed, 25 Mar 2009 01:47:15 +0000 http://www.milliondollarjourney.com/?p=824#comment-74816 Your bank or better yet, Credit Union might be able to answer questions on market trends and pricing / value. Start with a Realtor for information on neighbourhoods, then corroborate it yourself by spending some time there, to determine if it meets your needs. Folk usually look at available amenities (Shops, and other services), recreational facilities & parks, access to transit or reasonable commute, schools, age demographics, etc. Once you have narrowed it down some, walk around, talk to the folks who live & work there, read local (neighbourhood) papers. Since you are renting (I'm envious of your low costs), you have some time to test drive a few neighbourhoods to see how they feel. Go out and poke around as though you were living there, spend some time & money in the shops, wander the streets, talk to the folks doing garden work. You should get a good feel for things in short order. Another option if you are a member of a Service Club is to ask your fellow members. The folk you will meet in most such clubs will usually offer their unbiased opinion. If you join an organization with many local clubs (eg. there are often a number of Rotary Clubs in any given area) you can often find information about the local scene that might be unavailable through other avenues. Hope this gives you a starting point. DAvid Your bank or better yet, Credit Union might be able to answer questions on market trends and pricing / value.

Start with a Realtor for information on neighbourhoods, then corroborate it yourself by spending some time there, to determine if it meets your needs. Folk usually look at available amenities (Shops, and other services), recreational facilities & parks, access to transit or reasonable commute, schools, age demographics, etc. Once you have narrowed it down some, walk around, talk to the folks who live & work there, read local (neighbourhood) papers.

Since you are renting (I’m envious of your low costs), you have some time to test drive a few neighbourhoods to see how they feel. Go out and poke around as though you were living there, spend some time & money in the shops, wander the streets, talk to the folks doing garden work. You should get a good feel for things in short order.

Another option if you are a member of a Service Club is to ask your fellow members. The folk you will meet in most such clubs will usually offer their unbiased opinion. If you join an organization with many local clubs (eg. there are often a number of Rotary Clubs in any given area) you can often find information about the local scene that might be unavailable through other avenues.

Hope this gives you a starting point.

DAvid

]]> By: J. http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74799 J. Tue, 24 Mar 2009 22:51:50 +0000 http://www.milliondollarjourney.com/?p=824#comment-74799 I have a couple of newbie questions, which I hope somebody could answer: - If (as somebody said above) we can't rely on information from real estate agents (because they are interested in selling), where do I go to get reliable information on real estate market trend and assess if the market looks fair/overprices/underpriced? - Where do you go to gather information on neighborhoods? I'm new to town, and I have been talking to some people to get there opinions on different neighborhood, but I'm thinking there must be some more systematic information somewhere. Also, when you "scout" neighborhood, what exactly are you supposed to look for? Right now I'm happy with renting (The rent + all utilities consume 13% of my gross), and I hope I can save enough for a good chunk of down payment when my time comes. I have a couple of newbie questions, which I hope somebody could answer:

- If (as somebody said above) we can’t rely on information from real estate agents (because they are interested in selling), where do I go to get reliable information on real estate market trend and assess if the market looks fair/overprices/underpriced?
- Where do you go to gather information on neighborhoods? I’m new to town, and I have been talking to some people to get there opinions on different neighborhood, but I’m thinking there must be some more systematic information somewhere. Also, when you “scout” neighborhood, what exactly are you supposed to look for?

Right now I’m happy with renting (The rent + all utilities consume 13% of my gross), and I hope I can save enough for a good chunk of down payment when my time comes.

]]> By: DAvid http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74780 DAvid Tue, 24 Mar 2009 19:30:21 +0000 http://www.milliondollarjourney.com/?p=824#comment-74780 Actually, this <a href="http://idioms.thefreedictionary.com/millstone+about+neck" rel="nofollow">millstone </a> is the one I was referencing. DAvid Actually, this millstone is the one I was referencing.

DAvid

]]> By: Elbyron http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74759 Elbyron Tue, 24 Mar 2009 15:38:39 +0000 http://www.milliondollarjourney.com/?p=824#comment-74759 "A house can be a millstone" Lol, this is one of the funnier typos I've seen lately. It made me want to go and find an appropriate photo. This is the best I could find: http://www.letheringsettwatermill.co.uk/images-temp/Millstones-lift-27.jpg "teach it to flush" http://blog.pennlive.com/thrive/2007/08/large_ToiletDog.jpg “A house can be a millstone”

Lol, this is one of the funnier typos I’ve seen lately. It made me want to go and find an appropriate photo. This is the best I could find: http://www.letheringsettwatermill.co.uk/images-temp/Millstones-lift-27.jpg

“teach it to flush”
http://blog.pennlive.com/thrive/2007/08/large_ToiletDog.jpg

]]> By: DAvid http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74756 DAvid Tue, 24 Mar 2009 15:25:21 +0000 http://www.milliondollarjourney.com/?p=824#comment-74756 Dwight, Have a look at any of the 'Rent vs. Own' calculators on the web as well. A house can be a millstone. There are times when renting is the best choice, and times when owning is the best choice. Do your research before jumping in to the ownership muddle. Having a dog in a yardless apartment does increase the labour (unless you can teach it to flush.....) DAvid Dwight,
Have a look at any of the ‘Rent vs. Own’ calculators on the web as well.

A house can be a millstone. There are times when renting is the best choice, and times when owning is the best choice. Do your research before jumping in to the ownership muddle.

Having a dog in a yardless apartment does increase the labour (unless you can teach it to flush…..)

DAvid

]]> By: FrugalTrader http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74730 FrugalTrader Tue, 24 Mar 2009 12:07:29 +0000 http://www.milliondollarjourney.com/?p=824#comment-74730 Dwight, there is no right answer to your predicament. If your wife is dead set on purchasing a house, perhaps you can sit down together and see what the costs would be relative to renting. Once it's on paper, it's easy to see if you can afford the payments or if the extra costs will affect your lifestyle. Here are some mortgage/rent calculators to try: http://www.dinkytown.net/java/ca.html Dwight, there is no right answer to your predicament. If your wife is dead set on purchasing a house, perhaps you can sit down together and see what the costs would be relative to renting. Once it’s on paper, it’s easy to see if you can afford the payments or if the extra costs will affect your lifestyle.

Here are some mortgage/rent calculators to try:
http://www.dinkytown.net/java/ca.html

]]> By: Dwight http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74690 Dwight Tue, 24 Mar 2009 02:55:41 +0000 http://www.milliondollarjourney.com/?p=824#comment-74690 I am currently in a tough situation, i live in ottawa where house prices have generally not been effected at all, they have stopped rising but are definatley not going down. I am young, recently married and a would be first time home buyer, i am currently renting and am having a hard time convincing my wife that continuing to rent is by far the best option for us right now. we pay roughly 1000/mth in rent, weve worked hard to erase student debts, our car is paid off and we both have decent jobs. right now we are able to save 1-2 thousand a month, but our savings is just starting to build, at around 20 G's now (mostly in RRSP's), how can i convince her that continuing to save for say another year would save us huge in the long run, especially with house prices still at an avg of 325,000 for a bungalow. shes so set on buying a house, it has been the topic of many arguments, and now that weve gotten a dog, "we NEED a yard"........i enjoy reading these posts and would appreciate any help on my own million dollar journey. I am currently in a tough situation, i live in ottawa where house prices have generally not been effected at all, they have stopped rising but are definatley not going down. I am young, recently married and a would be first time home buyer, i am currently renting and am having a hard time convincing my wife that continuing to rent is by far the best option for us right now. we pay roughly 1000/mth in rent, weve worked hard to erase student debts, our car is paid off and we both have decent jobs. right now we are able to save 1-2 thousand a month, but our savings is just starting to build, at around 20 G’s now (mostly in RRSP’s), how can i convince her that continuing to save for say another year would save us huge in the long run, especially with house prices still at an avg of 325,000 for a bungalow. shes so set on buying a house, it has been the topic of many arguments, and now that weve gotten a dog, “we NEED a yard”……..i enjoy reading these posts and would appreciate any help on my own million dollar journey.

]]> By: john http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74515 john Sun, 22 Mar 2009 20:02:29 +0000 http://www.milliondollarjourney.com/?p=824#comment-74515 It's a good time to buy if you like losing lots of money month after month for the next two or three years. It's an even better time if you like the idea paying twice or more on your monthly mortgage payment in a few years when interest rates shoot up. The best time to buy is when the house you want is either: 1) Cheaper than rent or 2) Is 3 times your annual income In either case use 25 year amortization and a 25% downpayment otherwise you have no business owning a home. It’s a good time to buy if you like losing lots of money month after month for the next two or three years. It’s an even better time if you like the idea paying twice or more on your monthly mortgage payment in a few years when interest rates shoot up.

The best time to buy is when the house you want is either:
1) Cheaper than rent
or
2) Is 3 times your annual income

In either case use 25 year amortization and a 25% downpayment otherwise you have no business owning a home.

]]> By: pacific http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74349 pacific Sat, 21 Mar 2009 14:09:09 +0000 http://www.milliondollarjourney.com/?p=824#comment-74349 16. mjw2005 "I always love listening to homeowners (like the lady who posted today) talk about how much money they made on there house, based on price increase alone….but they never take into account all the money they have spent to get there….on a $200,000 mortgage at 4% your spending around $8,000 a year in interest alone, plus property taxes and house maintenance. Then when you sell you have to pay a RE agent 3%, plus more lawyer fees, plus land transfer taxes….and on it goes…." Try renting a decent place for less then 8000 a year. 16. mjw2005
“I always love listening to homeowners (like the lady who posted today) talk about how much money they made on there house, based on price increase alone….but they never take into account all the money they have spent to get there….on a $200,000 mortgage at 4% your spending around $8,000 a year in interest alone, plus property taxes and house maintenance. Then when you sell you have to pay a RE agent 3%, plus more lawyer fees, plus land transfer taxes….and on it goes….”

Try renting a decent place for less then 8000 a year.

]]> By: DAvid http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74300 DAvid Sat, 21 Mar 2009 02:19:53 +0000 http://www.milliondollarjourney.com/?p=824#comment-74300 There is about a 0.1% vacancy rate in our area just now, what is available is of poorer quality, or very pricey. Rental costs are comparable to mortgages, <b>if</b>you can find a suitable place. The rapid increase in housing costs over the past few years has far exceeded the increase in salaries, making an area that was affordable to families with an average income, unaffordable. Most folks who move here need to find a place to live in short order, and while there is a considerable selection available, it is not cheap, nor available for rent. While house values have dropped across much of the country, our neck of the woods has been insulated from that drop, and saw a modest increase in value of about 2.8% between Jan. 2008 and Jan. 2009. While volume is down, much to the disappointment of local Realtors, prices are up. Thus, it's not that renting is unbearable (ask our tenant) its simply not available! DAvid There is about a 0.1% vacancy rate in our area just now, what is available is of poorer quality, or very pricey. Rental costs are comparable to mortgages, ifyou can find a suitable place.

The rapid increase in housing costs over the past few years has far exceeded the increase in salaries, making an area that was affordable to families with an average income, unaffordable. Most folks who move here need to find a place to live in short order, and while there is a considerable selection available, it is not cheap, nor available for rent.

While house values have dropped across much of the country, our neck of the woods has been insulated from that drop, and saw a modest increase in value of about 2.8% between Jan. 2008 and Jan. 2009. While volume is down, much to the disappointment of local Realtors, prices are up.

Thus, it’s not that renting is unbearable (ask our tenant) its simply not available!

DAvid

]]> By: archanfel http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74167 archanfel Fri, 20 Mar 2009 04:00:36 +0000 http://www.milliondollarjourney.com/?p=824#comment-74167 DAvid, why would you want to enter today's market if the market is unbalanced? Is there any reason that you find renting unbearable? DAvid, why would you want to enter today’s market if the market is unbalanced? Is there any reason that you find renting unbearable?

]]> By: DAvid http://www.milliondollarjourney.com/it%e2%80%99s-a-great-time-to-buy-your-first-house.htm/comment-page-2#comment-74155 DAvid Fri, 20 Mar 2009 02:12:59 +0000 http://www.milliondollarjourney.com/?p=824#comment-74155 But Ed, all those options depend on the ability to obtain that extra financing. In instances where those options are not available, and prices are increasing fast enough, it may make more sense to pay the 2.75% premium than watch house prices increase by 5% (or more) before you can effect a purchase. I fully agree that the increases in housing prices as I described is rare. I don't expect it to continue, and am waiting for the fall, however, I could not afford to enter today's market, and am very happy I do not have to do so. Archanfel, I do not expect this trend to continue. I believe our neck of the woods played "catch up", and we were fortunate to arrive at the time in the cycle we did. My point was that given the increase in housing costs our community has experienced, we could not afford to enter today's market. I don't really see the increase in costs as having any real benefit, as it has just made our community inaccessible to many potential residents. DAvid But Ed, all those options depend on the ability to obtain that extra financing. In instances where those options are not available, and prices are increasing fast enough, it may make more sense to pay the 2.75% premium than watch house prices increase by 5% (or more) before you can effect a purchase.

I fully agree that the increases in housing prices as I described is rare. I don’t expect it to continue, and am waiting for the fall, however, I could not afford to enter today’s market, and am very happy I do not have to do so.

Archanfel, I do not expect this trend to continue. I believe our neck of the woods played “catch up”, and we were fortunate to arrive at the time in the cycle we did. My point was that given the increase in housing costs our community has experienced, we could not afford to enter today’s market. I don’t really see the increase in costs as having any real benefit, as it has just made our community inaccessible to many potential residents.

DAvid

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