Home Buying in Denver>Question Details

Justin Kemple…, Other/Just Looking in Denver, CO

Keep renting or buy?

Asked by Justin Kemple - Trulia Sales, Denver, CO Sun Dec 16, 2012

Considering that I work for Trulia I thought I would come here for some help. I've lived in Denver for about 6 years now always renting. I'm trying to save money but also looking for a nicer place to live. I've considered buying now for a while but may also move out of state in about 2 years to finish a masters degree. My real question is would it be worth it to buy a home if I may move in the next 2 years? Also I've looked for homes for rent here in Denver and found no luck, but I need a bigger place than where I'm at now..

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Bill Eckler-Florida,’s answer
This depends on your needs and the opportunity that presents itself. With this said, for short term needs it is generally understood that renting is the best option. By renting, one doesn't need to worry about the financial upkeep on the property, taxes, and selling the property short term, which can be problematic.

Good luck,

Bill
0 votes Thank Flag Link Sat Dec 22, 2012
BEST ANSWER
Justin,

Thanks for your work with Trulia. The company is a big plus for all of us who use your services. John below made some good points. On the other hand you might consider a purchase since you can purchase so easily these days. As a first time home owner there are great programs with low down payment and low, low interest rates. You will have to make a mortgage payment to someone. either yours or your landlords. The other thing to consider is that if you decide to move out of state for a couple of years, you would then be in the position of the landlords you are looking at now if you could not sell for a profit.. You could pick and choose and determine how much rent to charge on your own place. There is a possibility that you could rent it for those 2 years using a property manager at a positive cash flow since buying is cheaper than renting. Check out my post on that here - http://j.mp/JFzjYI . Let me know if I can help you further.

Robert McGuire ASR
Realtor/Consultant
Your Castle Real Estate
Direct - 303-669-1246
http://about.me/robertmcguire33
0 votes Thank Flag Link Sun Dec 16, 2012
I would say that you should go for buying a a new house only if you can rent it for the two years otherwise avoid buying it for the time being.
0 votes Thank Flag Link Sat Dec 22, 2012
What about taking the rent to own option that is rarely considered by many.
0 votes Thank Flag Link Tue Dec 18, 2012
In my opinion, it could make sense to purchase now, even if you have to move in a couple of years.
Prices, as stated in previous posts, have bottomed out and are beginning to rise. If the increase as much as 5% per year over the next couple of years, you could sell in two years and still walk away with money. This would need to be calculated, specific to your situation, but could work.
The other option would be to keep the property as a rental. This simply depends on your specific situation, comfort with being a landlord (or outsourcing that job) and taking on this inherent risk, however minimal it might be.
My suggestion would be to find a Realtor you can trust and seriously examine the possibilities. With rates this low, and prices likely to rise, there may not be a better time to buy than now.
Best of luck.
Chuck Strauss
Your Castle Real Estate
720-318-7598
denverhomeguru@gmail.com
0 votes Thank Flag Link Mon Dec 17, 2012
With renting you know exactly where your money is going. Into your Landlord's pocket. You can't improve the home the way that you want it and you are subject to the Landlord's preference to stay or go.

I have heard that Denver is a great area for investment and you've also mentioned that you couldn't find a rental home so there are many others in your same position I'm sure. Buy now and invest in your future. When you move, rent your home (carefully screening and selecting tenants) and you'll have a wonderful investment in your retirement.
0 votes Thank Flag Link Sun Dec 16, 2012
Buy in the right area, for the right size, and possibly with built in equity or equity you can acquire with a few improvements and Buying is the definite way to go! I can show you plenty of options especially in Denver in an assortment of areas. Kim Davis, FindYourSpace@me.com or give me a call 303.218.8373. Two years of not throwing your money away, or paying someone else's mortgage... it's time to Buy!
0 votes Thank Flag Link Sun Dec 16, 2012
Hi Justin -- that's a really good question. If you know with certainty you're moving out of the area in two years, it probably doesn't make sense to buy unless you're planning to return after you get your masters degree. If you think you may be in the area for 3-5 years, it definitely make sense to buy now.

The market has completely bottomed out as far as price, and interest rates are under 4%. Are you aware that you can buy a house with just 3.5% down? Most people aren't aware that you can get an FHA loan for 3.25% fixed for 30 years with just 3.5% down.

As much as the market has bottomed out, you "could" make a profit in two years but it's unlikely. I hope this has been helpful. Feel free to contact me with more questions. Good luck! Julie Montgomery (one of your favorite Trulia clients), RE/MAX Masters, Inc., http://www.jmontgomery.com
0 votes Thank Flag Link Sun Dec 16, 2012
Justin, If you can find a property you love then you should absolutely buy it. Otherwise you need to determine if the tax incentives and investment potential associated with a home purchase outweighs the ease of continuing to pay rent.
0 votes Thank Flag Link Sun Dec 16, 2012
Hi Justin,

I would love to meet with you personally and crunch the numbers as well as showing you available properties in your desired area. Let me know what your schedule is as we will make ourselves available.

Check out our website for current inventory.

Carlos Ors
Owner/Broker Associate
The CORE Team
Coldwell Banker Residential Brokerage
600 Grant St
Suite 900
Denver, CO 80203
CarlosOrs@corealtygroup.co
http://www.corealestatesolutions.com
0 votes Thank Flag Link Sun Dec 16, 2012
Justin,

I purchased my first home at 35th and Cook Street and know the area well. This 'Clayton' area is a good up and coming area in NE Denver. Nice fix and flips like this bungalow. Good appreciation, and gentrification. One of several great areas to find what you are looking for. I have a 'Listing Alerts' program that will show you all similar homes available in requested areas and then email you daily when new listings become available. let me know if that would help you at this time. Best of success with your search.

Robert McGuire ASR
Realtor/Consultant
Your Castle Real Estate
Direct - 303-669-1246
http://about.me/robertmcguire33
0 votes Thank Flag Link Sun Dec 16, 2012
Justin, with rates as low as they are, home prices down significantly since 2007, and rising rental costs, it would be hard to justify renting if you are able to buy. I have a nice rent v buy calculator that helps answer this question. Check it out here: http://www.realtyandfinance.com/Mortgage_Loan_Simulator/page…
0 votes Thank Flag Link Sun Dec 16, 2012
Your question is would it be worth it to buy if you might move in 2 years. What do you want to do? It could or could not be worth it. What are you priorities? The worth could be found there!
0 votes Thank Flag Link Sun Dec 16, 2012
just as a guidline again for what I'm looking for I saw this house a few days ago and thought it would be great.

http://www.trulia.com/property/3072922006-3625-Garfield-St-D…

The earliest I would be able to move would be around march.
0 votes Thank Flag Link Sun Dec 16, 2012
Hello Justin! I have a lot of friends in the same boat as you. Here is the low down; as a home owner the best surprise comes with your taxes. All of your interest on a home loan is deductible. At the beginning of your loan you pay more in interest then principle. Depending on the size of the loan you get to write off a good chunk of cash. That gives you a nice check come April. You have a good idea of what Denver's rental market is doing right now and its projected to keep rising. A loan of 220k is approx. $1000.00 per month. That can get you into a house in many of Denver's good neighborhoods. You would be lucky to get a 1bdrm condo to rent at that price. When you are ready to pursue your masters then you can rent it out for income. There is a good list of pros and cons but in the end it just makes sense to buy. I would enjoy sharing my expertise with you and assist you in your decision. You can contact me anytime!

Jesse Frasier
LIVE Urban real estate
jesse@liveurbandenver.com
970-846-7610
0 votes Thank Flag Link Sun Dec 16, 2012
http://www.facebook.com/YourDenverRealEstateExperts?sk=notes…

Hey Justin,

Check out this article. Even if you end up leaving Denver, a home purchase could be a great investement opportunity! Interest rates are low and prices are good and expected to rise in the future!
Brooke
303-919-3933
0 votes Thank Flag Link Sun Dec 16, 2012
Justin,
Depends, if you are planning on selling when you leave, then probably best to continue to rent. However, if you are comfortable with a longer term investment, I would be leaning towards a purchase. As you've experienced, the rental market is tight, so you should be able to rent it easily and for a premium in most cases.
0 votes Thank Flag Link Sun Dec 16, 2012
Just to throw in some of what I need. I would require at least a 3 bedroom 2 bath property with garage and basement. Currently my rent is 1325/ month So I would want to stay around that much for a mortgage payment. Since this would be my first time buying a home if it comes to that I would most likely seek an fha loan, with a small down payment. I would be willing to rent the place out If I decided to move.
0 votes Thank Flag Link Sun Dec 16, 2012
You have a number of variables going on there, so it depends a lot on how those turn out. Would you be willing to rent your place out in two years if need be? Also what are you looking for in a rental, I have a couple of places coming up for rent in the denver area. Feel free to contact me at Jimismyagent@gmail.com
0 votes Thank Flag Link Sun Dec 16, 2012
There are lots of different "correct" answers for this question, so you will have to make your own decisions ased on what folks write back here.

My 2 cents is as follows: I would definitely consider purchasing, if you are financially able to do so. Rates are low, housing is still reasonable, and rents are high. For what you're paying in rent, I'm sure you could comfortably afford a mortgage payment, and then you get the benefits of mortgage interest deduction, pride of ownership, and you get to choose the home you want (instead of having to rent what's available when you need it).

Now, if you do have to leave in 2 years for a Masters' Degree (which you should absolutely pursue!) there's still going to be a good rental market, especially if you choose wisely when you purchase. Then you will have a good investment that someone else is helping pay for.

Best of luck with your purchase, and please feel free to contact me if you have further questions! Sean@HawaiianShirtGuy.com.
0 votes Thank Flag Link Sun Dec 16, 2012
It really depends on your circumstances. What is your down payment? Are you ready to handle the maintenance of home ownership? If you can't sell the property in two years are you willing to be a landlord? Probably way to many questions to ask than what this forum allows.
Web Reference: http://www.my5280homes.com
0 votes Thank Flag Link Sun Dec 16, 2012
...and Justin, Thanks for asking and good luck with whatever you pursue!
0 votes Thank Flag Link Sun Dec 16, 2012
Justin If you are thinking you might move in a couple of years I would not suggest buying. If you move you still have a mortgage payment plus rent where you go. Five years, I would buy. I assume if you are completing your masters you will not have much time for making money.
0 votes Thank Flag Link Sun Dec 16, 2012
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