I rent in NY and wish to buy a house in FL, as home prices in NY seem ridiculous, would I have a problem

Asked by A Batista, 11356 Sat Jan 17, 2009

financing it as it wouldn't t be owner occupied at least for a few years as i get more and more tired of this winters?

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Kelly Bkk, Home Seller, Florida
Fri Jan 23, 2009
From the last poster (clearly a real estate guy):

""Let's take this scenario for example: let's say you're paying $2000 a month rent here in New York and you stay here for 5 more years. That's $24,000 a year in the toilet or $120,000 over 5 years."

OK -- now for the real math.

Paying $2,000 a month for 30 years at 6% yields a "present value" (price of the house that these payments could support) of $333,588. Assuming NO downpayment, At the end of five years (to be consistent with the example above), you will have paid $97,000 in interest and paid down $23,000 in principal. Assuming nothing has changed in the market, you will have $23,000 in equity in the house. Well, that's something, I suppose. But you will have thrown $97,000 out the window in interest payments. Of course, if you then tried to sell the house for what you paid ($333,588), you will pay a 6.0% commission ($20,015), leaving you with all of $3,000 in net "equity" to put into your pocket. Big whoop. For that $3,000, built up over 5 years, you have locked yourself into a mortgage, into a location, and lost all flexibility of change of job or change of geography. What if prices go down? Opps . . . . that $3,000 doesn't look very good after all now, does it.

Renters may be throwing their money out the window in rent payments, but house owners do the very same thing for a very long time as well -- only in their case its called "interest" on the debt they've taken on.
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Cathryn Blai…, Agent, Cape Coral, FL
Mon Jan 19, 2009
There are some really great loan programs now available, but you probably want to get pre-qualified first before looking. Some sellers will not take your offer if you are not pre-qualified up front. Also, unless you are pre-qualified, realtors will be hesitant to show you anything. The reason is, these properties are going fast, and you are competing against those who are willing to pay cash. If you are pre-qualified and your offer is good, your offer may be taken over a cash offer who is offering less.

I will be happy to help you find the appropriate financing you need to purchase one of the great buys in this area. Also please visit http://www.Hope4HomeBuyers.ORG to look at listings and full color home tours from local realtors. You can sign up for listing book to be sent new home information as it hits the market.
If you are over the age of 62, you may qualify for our Reverse Mortgage Purchase Program where you can buy a home without a mortgage payment. Contact us today and we will have you pre-qualified in minutes.

Cathryn Blair-Bennett
First Capital Lending
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Bill Eckler, Agent, Venice, FL
Sun Jan 18, 2009

Many people in your position are taking this course because they see tha advantages of purchasing now and taking advantage of the low prices, large inventory, and unbelievable low interest rates.

Financing can easily be arranged.

We just presented an offer on an 2001 constructed home, 3/2/2 in a very nice location, with an asking price of $69,900. If you would like to find out more aout these kinds of opportunities we would be happy to hear from you.

Best regards,
Susan & Bill

Michael Saunders & Company
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Ralph Windsc…, Agent, Hauppauge, NY
Sun Jan 18, 2009
Hey A, Whatever you're paying rent could go towards a mortgage wherever you're living right now. Also, how would you maintain a home so far away? You may want to consider purchasing something here in NY, even though the prices are high, even something like a coop, paying it off for several years, and then taking the equity you just built up to buy something in Florida with more money to work with. If you plan on staying here for more than let's say 5 years, that may be the way to go. Paying rent is like opening the window and throwing your money away plus you don't receive any tax benefits from renting. Let's take this scenario for example: let's say you're paying $2000 a month rent here in New York and you stay here for 5 more years. That's $24,000 a year in the toilet or $120,000 over 5 years! If you're not itemizing on your taxes right now, that could be another $25,000 of losses in income tax returns! I would recommend you find out how much you qualify for now, find a bargain here, hold it for 5 years, get sick of the winters here in a few years and then say thanks Ralph.

If I can help you any further, please contact me.

Ralph Windschuh
Century 21 Princeton Properties
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