Allow me a second to explain something. The whole thing of "home appreciation" was based on the value of undeveloped land versus developed land. Of course once you take raw land and make it ready for use it is worth more after being developed than it was when you purchased it. However, the term has been misapplied to homes because of the business of credit which benefits no one except the lenders. And don't let that surprise you because politicians and business men "misapply" terms all the time when its to their benefit.
Anyway... a home is a "product". And like any other product it looses value with time, UNLESS someone is willing to pay more for it. You could make the claim that the value has increased but if no one is willing to pay the asking price, the price naturally must come down to a point in which someone is willing to pay. Therefore, it has no real value other than the "perceived value" of the buyer and/or seller. And this is the stalemate that you will find with older homes.... the buyers "believe" that the homes are worth more than they actually are. And the inflated appraisal rates and greedy agents, brokers, and lenders that depend on percentages for profits don't help this none.
I'm sorry, but it is just my belief, naive as it may seem, that at this time in our human mental evolution we should be aware that there are other options to nearly all things. And the ways that we were TOLD to do things may NOT have been correct or the most efficient, and in some cases, the things that we were told may have been deliberately misleading. Because if this were true, that the older a home is the more it is worth, then every home built in the 70's should be worth a fortune right now.
Just think about it.
And for option D to be worthwhile the rent needs to cover the mortgage/taxes etc. and preferably be a bit higher to cover repair costs you'll have to do at some point (also consider vacancy rate when calculating how much money you'd get from renting it out)
You can get your money's worth in the area of your choice if you avoid pre-existing homes, owner builder programs that force you to take out a LTV loan or what they call "permanent financing", developers, and buy at the right price.
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I hope I said something to trigger a different thought pattern.
We would profit from renting out our current, as we have no mortgage (we're savers who live with a cruddy kitchen but paid our mortgage off in 11 years). But I'm not thrilled w/the idea of being a landlord.
We still have done nothing, just save & live in a nice but small house with few updates. We are in a prime condition to buy, I realize, but are afraid of the high taxes on moving u (remember-we're conservative squirrel savers!).
What do you mean by a "pre-existing" home? Don't most people go out "house-hunting" and look at/purchase homes already there that are being sold?
One house we've looked at was built years ago, but all but torn down and renovated/built onto a couple of years ago. We'd love to buy it since it's essentially new. The biggest problem is that the taxes are high (and it's not in the highly desirable area, just okay.
Thank you very much for your feedback!
We don't, fortunately, need to sell our house to buy.
I know that it is a decision we ultimately have to make, but just wanted to search for some cold, hard economic facts to back up or to consider in our decision.