Rent vs Buy in 45140>Question Details

Sarah Burke, Home Buyer in Loveland, OH

Rent or Buy?

Asked by Sarah Burke, Loveland, OH Sat Apr 23, 2011

My fiance and I are going to be moving to Tucson, Arizona in the next few months, as I will be attending the University of Arizona in the fall. We are both 18, though my fiance will be 19 in July, and he's just now starting to build his credit. I have found several nice houses very cheap ($30,000 or less) which would leave us a lower house payment per month(around $180) , and I have also looked at apartments, with the lowest rent payment being $400 per month. I was wondering what the smartest thing to do would be, buy or rent, considering a lower house payment vs. higher rent payments. (We more than likely would be staying in Tucson for at least four years, probably longer.)

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Kimberly Ann Lawson’s answer
Hi Sarah,

I would also add some things that you might not have considered.

I'm sure you've heard this ole adage, you get what you pay for. Based on the quick search I performed I found it's either 1) a condo, unless condos are prevalent in an area I would pass OR 2) There are a bunch of repairs that will be needed because it's a foreclosure (not to say all foreclosed properties are in need of a lot of repairs).

Isn't cheaper. You've mentioned the monthly cost. Something you're not considering when you own real estate there are property taxes, insurance, mortgage insurance depending on the amount of your down payment (none if you put down 20% or more) and association dues. I'm not making any quotes. I am only using the figures from your original post: if rent is $400 and if you were able to obtain a loan for $180/mo. The $180 + $200 for taxes and insurance for Single Family Residence or for a Condominium you'd pay for the same taxes but the insurance you pay is an HomeOwner's Association Dues (which includes walls out insurance for the Association) and then you buy a H06 policy too, this covers the walls in and your contents/personal belongings the cost would be over the original $200 used solely for example purposes. All in total either way you're paying just as much as renting, if not more, in monthly cost.

I haven't even mentioned that with a landlord, they fix everything! If you own, you are the landlord. There is bound to be something that needs your attention.

So, while all of the other advice is great too, I wanted to provide something more towards how it would affect you financially if you did decide to move forward with buying.

I hope this helps.
Kim

I am a licensed mortgage loan officer in Ohio only. My licensing and contact information is in my profile.
0 votes Thank Flag Link Wed Apr 17, 2013
If you rent you won't have the responsibility of taking care of a home in addition to your studies. You are better off renting and building your credit. Who knows what will happen between now and graduation. If you are fiscally responsible during college, you will have great credit upon graduating. With this credit you will be in good shape to make that first home purchase.
0 votes Thank Flag Link Wed Apr 17, 2013
My advice to you would be the same I would give my sons when they go off to college. Rent for now, alot changes in your life very fast when you are young. Read some of Dave Ramseys books they will help you for a lifetime. Your idea is forward thinking and if your parnets have the means and want to play the real estate game and have the CASH to pay for home it might be a good move but for you my advice is to wait. GOOD LUCK
0 votes Thank Flag Link Sat Apr 23, 2011
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