BuyAHouse #HomeOwnership #RealEstateInvesting
Should I Buy a House? A Millennial’s Dilemma
Buying a House vs Renting: The Financial Breakdown
If you’re in your late 20s or early 30s and you’re considering buying a house for the first time, you’re not alone. Many millennials, like you, are faced with the decision of whether to invest in homeownership or continue renting. Let’s break down the financial aspects of buying a house versus renting based on your unique circumstances.
Financial Snapshot: Your Income and Assets
You mentioned that you make $62k a year, have significant savings, investments, and minimal debt. With a stable job and financial stability, you’re in a good position to consider buying a home. It’s essential to factor in your monthly expenses and potential mortgage payments to determine if purchasing a house is a feasible option for you.
The Cost of Homeownership: Down Payment and Monthly Payments
Given your financial situation and the generous down payment from your grandfather, buying a starter home seems like a viable option. With an estimated monthly mortgage payment of $1600-1800, you can comfortably afford the payments. However, it’s crucial to consider additional expenses like property taxes, insurance, and maintenance costs when budgeting for homeownership.
Renting as an Alternative: Balancing Education and Housing Costs
Renting a 1-bedroom apartment might seem like a more straightforward option, especially if you’re planning to go back to school part-time. With lower monthly rent costs, you can allocate more funds towards tuition and educational expenses without depleting your savings. Additionally, renting allows for more flexibility in your budget, as you can adjust your living situation based on your changing needs and financial goals.
Making Informed Decisions: Weighing Your Options
Ultimately, the decision to buy a house or rent depends on your long-term goals and financial priorities. It’s essential to consider the impact of homeownership on your lifestyle, career aspirations, and educational pursuits. By carefully evaluating your options and consulting with financial advisors, you can make an informed decision that aligns with your goals and values.
Seeking Advice: The Value of Different Perspectives
While friends and family may offer well-intentioned advice, seeking opinions from diverse sources, like online communities, can provide valuable insights and perspectives. Engaging with strangers on the internet allows you to gather a range of opinions and considerations that you may not have thought of before. Remember, it’s essential to weigh all factors and make a decision that aligns with your financial goals and personal values.
Conclusion: Finding the Right Path for Your Future
In conclusion, the decision to buy a house is a significant financial step that requires careful consideration and planning. Whether you choose homeownership or continue renting, it’s essential to prioritize your long-term financial well-being and personal goals. By weighing the pros and cons of each option and seeking advice from various sources, you can make an informed decision that sets you on the right path towards financial stability and success.
**If you have no need for a house, don’t buy a house.** This should be one of the cardinal rules for this sub. Right now is especially a terrible time to buy due to the 7% interest rates and the depressed supply (everyone who could sell sold during 2021 and everyone else is largely holding onto their home because an upgrade isn’t affordable due to the high interest rates).
Take the $100K and do one of two things with it:
* High yield savings – Free money every month for doing nothing. Allows you to hold onto this in cash risk free if you do plan on buying something in the next few years (maybe when interest rates drop)
* Invest it into the market – if you don’t plan on buying a home anytime soon, invest it all into the market. I’d p ick something safe like SPY.
As someone who lives in an area where housing is over 4x as expensive its a no brainer, buy a house.
Looking good overall man. If i was you… Use your entire 130k brokerage account, grandpas 100 and put 230 on a 300k. At 29, with a 70k checking, a 15k roth ira, and a 5k 401k, and 15k crypto (id put this in sp500 if you do what im saying), you will have such a cheap mortgage, be building equity, and have a good enough base to start really building retirement accounts (they need to be much higher for how much you have tbh). Honestly, if nobody has asked, why you even going back to school right now. Buy the house and see where your at… in due time you could be making 80-90 and realize schools just not worth it for your lifestyle that you made. Also if you do this, sign a prenup if you get hitched. Good luck meng
That’s a huge down payment and you would still have a lot in your brokerage. Yes, move out!
You are killing it my man. Since your grandfather is giving you 100k for a house, thats just too good to pass up in my opinion. Don’t get over your head and buy some super expensive house though.
Well you’re talking about putting 150k into a house, and your payment goes UP by a couple of hundred per month (vs renting an apartment). Plus then you have repairs and maintenance and insurance and all the rest on top of that. You’re probably looking at $800 EXTRA to buy vs rent. After you’ve already depleted 150k!
Instead you could be putting that 150k into a zero risk HYSA and be GAINING $800/month!
Buying isn’t bad, but neither is renting, it just depends on circumstances.
But isn’t forget to factor in opportunity cost of the money that you put in. It’s not zero, especially these days.
If you haven’t lived on your own I would not buy as your first move getting out. Rent for a year or 3 then buy after you better understand what you’re getting into. Otherwise buy as cheap a house as you can since you’d likely want to move again eventually.
https://www.gocurrycracker.com/renters-for-life/
Think of this as well. You could buy a house and rent a room to supplement your income and lower your cost of living. If you’re happy living with your mom and pitching in on rent there, no reason not to stay, but if you want to live on your own, it’s something to think about.
Rent is your maximum out of pocket for housing every month when you’re renting. Your mortgage is your minimum when you own.
Are you even interested in owning and maintaining property? 99% of people will say you’re just paying someone else’s mortgage, so why not pay your own. But do what you’re comfortable with. You seem to have your head on straight financially, so don’t be pressured to do something you’re uncomfortable with when buying a home. It’ll likely be your largest purchase during your life, so be patient when making the decision.
Just get the 100k from your grandfather and put in the market. Live rent free (profits from the 100k) in your mom’s basement for the rest of your life
There are some options for first time homebuyers get an agent and make them work for you. They will be happy to help
I wouldn’t tell anyone to buy a home right now. Interest rates are way too high and prices are falling. Rent from a private renter or stay where you are till the rates go down and the prices flatten and then buy. You’ll kick yourself paying 7 percent if you bought now only to watch it go back down to 4 after. You can refinance after a year but that’s a year of paying more than you should.
Yeah, go rent first and see what independently life is like before you buy a place.
Also, speak with a mortgage writer as they can tell you how much you qualify for and it doesn’t cost you a dime until you sign for a home.
just because you can put 50% down doesn’t mean you need to.
I would look at some homes online, run some mortgage calculators that include property taxes, then also factor in things like you could move in and the following week water heater, furnace or something else could go down so you don’t want to put yourself in too tight of a spot.
how long before you would be out of school and what kind of pay bump will it get you? if it is just 1 more year of classes then honestly I would live in the basement for 1 more year, cash flow school and then buy
I think you are in a good spot to do it. But only if you really want to or want the freedom of your own place. You could also buy a house and rent rooms.
Either way, please tell me you don’t have $67K in basic savings and checking accounts. You can have 1-2 months of expenses in a basic checking. But the rest should be in a HYSA that is getting you at least 4.5 to 5% interest.
Honestly, the first thing that stuck out is that you need to move out of your parents house. You will grow and develop so much on your own.
The second is that don’t make too many life changes at once – buying house and starting school at the same time.
If grandpa is willing to give you 100k, can he just give you that so you can pay tuition of of pocket?
If you really want to buy, I suggest the smallest condo in the best neighborhood you could afford. They are easy to sell or rent if you decide to buy a home some day. You need to concentrate on your studies and a house is a lot of maintenance.
I think one missing piece here is the degree. It’s worth asking what it will bring in, if anything. As someone with a basically useless degree, be sure you are pursuing one with value.
How long will it take the degree to pay for itself? You can’t turn around and sell the degree at cost or above like the home. Just be sure it pays to get it.
That $55k over 4 years put into another property could translate to close to a second place, then renting the home, and that would generate more income than plenty of degrees.
If you want to move out and stay in the area for several years, buying is a no brainer. You have a mostly fixed cost for housing. Maintenance is unexpected and can be expensive, but I’ve not had to pay more than like $5k in a single year for maintenence, and I feel like it has usually been <$1k/yr. You build equity, and you get more autonomy if you are not in an HOA.
You do you.
I just know that if I were sitting on a few hundred grand and living with my mom at any point beyond 18, I would feel like I’d done something wrong with my socialization.
But that doesn’t mean I’d buy a house.
Think at least five years ahead. If you buy a house now, will you still be there in five years? If no, then probably don’t buy a house right now. Instead, rent something that meets your wants/needs and still allows for continued savings and consider buying when you’re more settled in what you want to live in.
Given your lack of income currently you’d be better off waiting until you have a couple years of good work history before applying for a home loan. Will help your rates and allow you the chance to learn how to live on your own prior to taking on the added responsibility of home ownership.
What are you hobbies and i terrsts, do you need or want a house?
I would suggest an apartment for a year regardless.
Don’t let other people tell you how to spend your money.
I’m curious why you’re going back to school? Assuming you like your job, and it’s stable…why bother with school? Why not just work your way up in the family business?
About the house…taking on a mortgage plus maintenance and bills that would be more than half my take home doesn’t sound too good to me. I wouldn’t do it.
I would look at a condo or small townhouse in your situation. you don’t really need a full on HOUSE house
Maybe instead of your own place, you and your mom can make a plan so you can live together now and in the future. It would take reframing the situation to be a mindful choice. It is normal in many cultures for multiple generations to reside together. Maybe you two could plan to buy or build a new house in the event that you marry and have children, one that could accommodate you all. Or if you have no plans for that, maybe you could work with her to be put on the deed and mortgage in exchange for using your own money to add onto the property. There are many options. Also, consider how living alone would affect you and your mother’s health and well-being.
Don’t buy a house. You live alone. You have to pay for all maintenance along with your mortgage. That shit adds up. If anything, buy a condo or townhome, you can probably put enough down on that to where you’ll be paying less than $750 a month. To be honest, houses are a fuck load of work. I used to own a house, I fucking hated it, and it caused me really bad depression and eventually anxiety attacks.
Buy a house get a roommmate and keep going well done buddy
Do you WANT a house?
I’ve been in a house for 15 years, have seen great appreciation, but I do not like being responsible for the upkeep and maintenance.
I’ll be out of a house an into a condo or apartment as soon as I can convince the missus that it works.
Rent. Costs you can’t control are property taxes, insurance and repairs. Insurance and utility rates both had rate increases this year. The first 4-5 years of payments are mostly interest. I don’t see the benefits of being a homeowner worth the risks to your financial stress combined with school stress at this time. But good luck- you hustler!
Yes buy a house so you’re in constant debt for the next 15-30 years like everyone else. Do what you want, not what everyone else wants. Renting is great in today’s housing bubble. When things break, landlord fixes it for free. No property taxes, no crazy interest rates. Do you.
Life advice – conventional wisdom is often terrible. Follow your own path and don’t worry about if everyone’s doing something different
How is a 350k home a starter home? Which city is this?
Honestly if you are still at home I would continue doing that especially if your dad is sick. I have been in that situation before. I ended up quitting school to help my mom take care of him and also start working our family business.
Take about $1000 a month and put it into a down payment account something that will accrue some interest at a good rate. This is your “can I afford to live on my own” trial. See if you struggle with the reduction in “income”. If you struggle well that answers some of your questions. If not, then keep moving the $1000 monthly to the down payment account. If you need to adjust the $1000 lower do so it is still progress toward building a sizable down payment.
Then there is always the option of some land and a tiny home (not a trailer home) don’t knock it until you research it.
How much college do you need to get the degree you want and how much will it cost you?
If you’re going back to school, I’m not sure I would do so with a mortgage. With the amount of money you can put down even with your family’s help, you’d still be looking at 40%-50% of your monthly take-home pay being put towards your mortgage, which is way too much.
If I were you I would continue to save and cash flow the rest of your degree and worry about a house later.
How much will school cost? How long will it take to finish? How much will it cut your income?
You can probably technically afford it, but I’m also a little concerned about – while its great you have so much in investments – what is not great is the really small amount saved for retirement. Your 20s are critical for ramping up retirement savings to maximize time for your money to compound and grow. Every year you aren’t stuffing money into those retirement accounts is costing you hundreds of thousands of dollars in lost opportunity that you can never recover.
Also, if you are serious about buying something I would be getting that 130k out of the stock market ASAP. Any number of things could happen that would cause that money to very quickly drop 10-20%. Heck, we were an inch away on Saturday from the market possibly dropping 10% yesterday. The rule of thumb is money you plan to use for major purchase within ~3 years should not be in the stock market. In your case sounds your use is possibly immediate.