Rent vs Buy in Fremont>Question Details

seamoss, Home Buyer in 94538

Thinking of buying a condo in Fremont, but...

Asked by seamoss, 94538 Sun Sep 23, 2012

I am thinking to buy a 2bd/2bath condo in fremont, but my concern is that we would not be living in the US forever and would be going back to our home country after 5 years. Is it worth buying a condo for this amount of time in Fremont ? My wife goes to SF for work and I work in Sunnyvale, so Fremont is ideal place for us. I am in a typical rent vs buy debate, but only concern in buying is: what if the property values go down considerably when I decide to leave ? Need some expert advice. Renting is getting expensive day by day, and also fremont has lot of old style apartments which we dont like at all

Help the community by answering this question:


Rents will not be going down any time soon. Here is a post that was written with your specific questions in mind:

Top 3 Buyer Questions – And Recommendations…
1 vote Thank Flag Link Mon Sep 24, 2012
No one can see into future. You must realize that we could all make our fortunes if we knew for sure where property values would be in five years. It may be a good plan for you to buy now and reserve the option to rent the property out if you do move away at a time when selling does make sense.
1 vote Thank Flag Link Sun Sep 23, 2012
Rent v/s Buy? I see that you almost answered your own question in last couple of lines. "Renting is getting expensive day by day." I would say do your math: calculate your interest payment, your tax savings, and equity position in five years from now and rent money that throw away and make your landlord rich. You can decide to make your mortgage payment or others... choice is yours!
I would be happy to discuss more at one on one consultation at no obligation if you like.

Good luck to you,

Charo Bhatt
0 votes Thank Flag Link Fri Oct 5, 2012
We cannot look into how market conditions are going to be five years from now. But looking at how the market is today, it makes no sense to rent. Interest rates are record low and property prices have come down substantially (althought they are now going back up).

Since so many people lost their homes in foreclosures and short sales, their credit scores were lowered and they cannot buy another home so they have to rent for a few years till their credit can be built up again. That is the reason the rents have gone up since the rental demand has been so high..

If you can afford to buy a home, you should go ahead and do so. When property values start to rise, they stay in that direction for several years as has been seen in the real estate cycles. Of course no one can guarantee that they will keep going up, but this is not like the stock market that goes up or down everyday.

Look at the quality of life when you own your own home. You don't have to depend on the landlord for paining the interior, changing carpets, updating the kitchen, baths if needed etc. You also don't have to worry about the landlord raising the rent on you or asking you to vacate.

When you look at selling in five years, it does not seem like it will be a problem since this market is only getting better every day.

Meena Gujral
0 votes Thank Flag Link Thu Oct 4, 2012
I agree with the others.

Five years is a long time to rent. Even if the condo you buy doesn't go up (which is likely it will) you will still have tax advantages and the chance to build equity. And with the high cost of rent, it might even be cheaper to buy.

0 votes Thank Flag Link Sun Sep 23, 2012
Hi Seamoss,

There is nothing like owning your own home. Coming home and knowing this home is yours. What a relief not having to worry about your rent being raised again. Only you can answer how important this is to you.

At least begin the process by talking to a lender and get preappoved, he will be able to tell you how much you can afford to spend. Talk to you CPA and see what will be more profitable for you in the next five years buying or renting. Taking these steps will help you make an informed decision for your future.
0 votes Thank Flag Link Sun Sep 23, 2012
This is a common question for many of my first-time home buyers who are in the same situation. While no one can accurately predict the future, the ones who have bought in the past 2 years have all done quite well on the appreciation side, doubling or tripling their initial downpayments.

Going forward, there's still plenty of drivers to push prices up further in Fremont for the next 1-2 years, including the higher rent you've mentioned and falling interest rates. With this trend in place, you'll be able to build up a significant equity buffer in 5 years to protect you from any shocks to the local housing market, which handled this last crash rather well in Fremont.

At the same time, you can save $400-600 a month versus rent (which has attracted plenty of my investor clients to Fremont). Put that away over 5 years and you'd have an extra $30-50K in cash, which would also off-set any drop in prices. So, buying today really makes sense. You just have to know how to compete effectively against all the investors who already think that way and want similar units to what you're looking at.
Web Reference:
0 votes Thank Flag Link Sun Sep 23, 2012
The conventional wisdom was that if you are going to be in one place for 5 years, then it may make sense to buy versus rent. But that idea flew out the window in the devastating real estate crash from which many of us are still reeling

That said, with property values and interest rates at their lowest levels in many years (interest rates are the lowest in 40 plus years), many are drawn back into the real estate market -- not just for buying their personal residence but also for investment purposes.

If you are non-citizens or non-immigrants, there may be some limitations about purchasing real estate property. So perhaps that's one of the first things you should look into besides getting preapproved for a loan (if you're not paying in cash).

If you don't plan to keep the property and re-sell after 5 years, then you should also factor the cost of selling.
0 votes Thank Flag Link Sun Sep 23, 2012
If you are going back to your country after five years from now, Renting is my option as you just leave the place whereas buying is also beneficial because you don;t loss your money paying rent. But when you are ready to sell and in a hurry to leave, you might be selling your home at a bargain.
0 votes Thank Flag Link Sun Sep 23, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2016 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer