Home Buying in Ukiah>Question Details

Sussexsi, Home Buyer in New York

is it worth buying a house, even if it costs decades of wages and hardship?

Asked by Sussexsi, New York Thu Mar 3, 2011

with current house prices and job stability, is it worth investing in your own property? or simply rent or move abroad?

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Answers

10
Great question!

Personally, I bet on the U.S and particularly Colorado.

I appreciate your frustration with sorting out what is best for an individual going forward, Sussexsi. You should speak with someone in New York because the rent-versus-own picture is different from my state, Colorado.

My advice has consistently favored home ownership. I can understand that you need to take the long term view. The good news is this may be one of the best times in history to make a home purchase.

Job stability is certainly a concern. However, are you going to make a judgment on any of these things you mention based on the last three tumultuous years? There were 70 years of growth with robust growth coming toward the end of the last century before those three awful years.

Some look on this as a time of great opportunities. I think it is.

While it is difficult to say that all homeowners will emerge unscathed by the current crisis, the longer trends favor home ownership. In fact, some are counting on a swing to the upside in real estate. You might not be aware of this, but many sellers who need to sell are postponing their decision until the economy gains more momentum and the real estate market begins rising. They may not wait that long - who can say? Some of the more optimistic analysts believe their opportunity could come as early as 2012. But, I strongly disagree with anyone who would make a generalization that a home purchase is not a great investment. You have to look at the question regionally, and then locally. In some states, there will be a long and gradual recovery. Others are seeing signs of recovery now.

There is certainly opportunity in real estate. I would urge you to speak to a Realtor in your area.

People who become home buyers now can take advantage of historically low interest rates. If you act in the next few months, you can avoid some of the upwardly revised fees that will come from FHA and others.

Why now? When rents climb higher - and they will - you'll be looking at competing with other renters who want to buy.

The people who found themselves in the position of paying on underwater mortgages are the few. In overheated markets like California and Florida, you have people who were chased into the market by fast rising prices. Now, many are simply walking away. The lesson that should be taken away from that experience is to not panic buy. The markets are stable or stabilizing. This is when you should lock in a low interest rate and take advantage of your ability to borrow. BTW: The window for borrowing without having to come up with a 20 percent downpayment might be closing. Down payments have come under scrutiny. You might have to be a renter longer under some change that is being contemplated.

As for moving abroad, you have to investigate on your own. I like it here. Different parts of the nation offer better opportunities than others. If you're in the petroleum industry, there are many places that are better than New York. In a few years, my part of the state (Colorado) will have a massive Conoco-Phillips research facility. Northern Colorado will soon have a new NASA facility that will promote industry growth and hire thousands. Scientists here will be able to book flights on space shuttles. We're excited about the future here.

Best,
SuZ
PML of Longmont, CO
1 vote Thank Flag Link Thu Mar 3, 2011
Unfortunately the decision to buy, rent or move abroad, is one only you can make--consider consulting with your tax professional and or financial planner, see what's best for you in the long run--to buy or not...
0 votes Thank Flag Link Thu Mar 3, 2011
Own VS Rent is definitely a personal desicison based on circumstances. It's difficult because circumstances change and what seems like a good idea today, could turn out to be the wrong decision in the future.
Bottom line, do the old "pro's and con's" and figure out what fits your current circumstances best and try to look forward 3 years, 5 years, 10 years and make your decision based on realistic goals and expectations.
I can tell you this though... I've met many people in the later stages of life that regret not buying more real estate. I don't recall ever meeting anyone that is glad they never bought real estate in their lifetime.
0 votes Thank Flag Link Thu Mar 3, 2011
Sussexsi,

I think the answer to that question has to be answered on a personal level as everyone is different. There may be reasons that you don't want to own and if there are then you shouldn't and there's nothing wrong with that. From a financial perspective, which your original question was framed, I think that it really comes down to a simple question. You're going to have to pay somebody for the roof over your head. If your a purchaser you might have something to show for it after decades, not to mention the enjoyment of creating your own little sanctuary. Renting is not going to give you either one of those.

Regards and best of luck.

Robin Brooks
Web Reference: http://www.agentrobin.com
0 votes Thank Flag Link Thu Mar 3, 2011
No one can answer this question but you. We all have many choices that we can pursue. You are the maker of your destiny.

Happy funding, Rudi
Web Reference: http://www.umboc.com
0 votes Thank Flag Link Thu Mar 3, 2011
Not for you, clearly, but for many people, yes.

Shelter, regardless of whether you rent or own, may cost decades of wages and hardship. So may food, entertainment, travel, life.

On the other hand, having fulfilling and rewarding work for decades, taking the money to create the living environment of your choice, purchasing the entertainments of your choice, developing relationships with positive-minded people, kind of makes life worth living.

All the best,
0 votes Thank Flag Link Thu Mar 3, 2011
Renting will never get you anywhere, it's like being in a boat with no oars and no wind. You just sit there. Current house prices are down, way down. That alone makes one wonder if there is any doubt that in the years ahead the house would not go up in value. Real estate is like the stock market, buy when prices are low and wait for them to go up, then sell or hang on longer. Buying real property is the #1 way most people increase their net worth in this country. Buying now and holding for 5+ years is a no brainer.
0 votes Thank Flag Link Thu Mar 3, 2011
UP to you as a buyer what your short / long term goals are.

You receive annual tax deductions owning a home confer with CPA

You don't have rent increase, entire point of owning a home you pay it off in your golden years you live "mortgage / rent free" than paying for monthly through your entire life

Mortgage you will have a fixed rate for years...vs. rent will increase

Lynn911 Dallas Realtor & Consultant, Loan Officer, Credit Repair Advisor
The Michael Group - Dallas Business Journal Top Ranked Realtors
972-699-9111
http://www.lynn911.com
0 votes Thank Flag Link Thu Mar 3, 2011
For most it IS worthwhile.

You have to decide if it is worthwhile for you!

With prices bottomed - or close to bottoming - the time is right for a longer term investment.

Good Luck!

Gerry Dunn
Associate Broker
Serving Maryland, D.C. and Northern Virginia
0 votes Thank Flag Link Thu Mar 3, 2011
Can I ask questions such as this here?
0 votes Thank Flag Link Thu Mar 3, 2011
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