General > General Technical Chat
First house for a young man
blueskull:
Hi all. This thread is to ask opinions about buying my first house.
As I'm progressing in my degree program, I'm about to graduate, and I'm expected to stay as a postdoc for at least 2 years. Depending on future situation, I may stay as a faculty, or I may leave and find a real job.
I plan to buy a house, for both investigation and to reduce cost of living. As someone might have heard, economy bubble is collapsing in China, and my parents' want me to buy a house in US as a safe deposit in case Chinese currency collapses. In the meantime, here (RDU metropolitan), real estate's value gains about 10% each year, while tax is only 1.03% (Raleigh city+Wake county), besides evaluated taxable value of houses is overall lower than their real market value.
So, long story short, I have $260k on hand (my parents sold one of their apartments used for renting, and I sold my 2 small houses for renting, both in China), and my parents can get me another $10k~$20k if REALLY needed. I plan to buy a small townhouse in Raleigh/Cary, NC with this money.
My questions:
1. Should I spend all the money (read: ALL) on a house that leaves me no money at all (maybe a few k$ in checking account, but that's it), or should I buy a cheaper house and spare some money in case of emergency? Right now I have 2 choices: a $270k house, including all costs, and a $220k house, including all costs, both townhouses, both are of similar 1700 sqft construction area, both have 1 garage+2 front door parking, the more expensive one has 3 bedrooms (so the rest 2 rooms can generate renting revenue) and is built in 2012, while the older one is a 2006 house with 2 giant bedrooms (despite giant, a single bedroom is worth the same from a tenant's eye).
2. I can generate ~$500 per month revenue per bedroom, and that means each year, I can make $12k from the $270k house, and $6k from the $220k house. Factoring in that, which one is my best choice?
3. Should I buy a house from the first place? I do NOT have a green card or H1B. I'm on F1 visa, but I'm sure if working in university, I have 100% chance to get H1B if my OPT runs out. In the meantime, I have confidence to get 100 paper citations (which qualifies me EB1 NIW green card program).
Inputs are very appreciated, as I'm about to pull the trigger very soon.
Scrts:
I've purchased my 1st house like 8 months ago and I don't regret going for cheaper option. It was a 3 bedroom house, which I've modified myself to be 4 bedroom now. Did some other stuff to raise the value and when I think about it: do I need lots of space and a big house? Nope. The more space you have - the more garbage you put around yourself. And you have to clean it. In addition to that, you have to heat additional space that you don't even spend 5% of your time per day. Go for bigger when you will have kids.
On the other hand: what if US crisis will repeat? Your losses with that more expensive house will be worse.
HackedFridgeMagnet:
My 20c
Buying a house is such a big financial decision, don't rush into it.
Look for a house that is going to suit you for at least the next 5 years, because if you sell before then you have probably wasted money.
Spend some time looking and you may get a bargain.
Apparently low ball offers do occasionally work too.
In the meantime you could try to align your savings with the housing market using some sort of Share based property portfolio. This way if the property market rises fast, then your savings should rise fast too.
Doing this could take the pressure off trying to buy the house without proper diligence.
Buying a house in a rush is a sure way to pay more than you need too.
One other thing, don't assume you know which way a market is going, if it's any sort of decent competitive market then most of the pricing signals have already been factored in.
good luck.
IanB:
Keep in mind that the costs of owning a house do not stop after you have bought it. Unless you are buying a brand new house there will be routine and not-so-routine maintenance costs that crop up. Such costs can occur anywhere from yard work, painting, fences, plumbing, roof, garage doors, appliances, termites, all sorts of things. Everything you expect the landlord to take care of when you are renting, you now become responsible for. Not to mention annual costs like insurance and property taxes.
Before buying, get some estimates of typical annual operating costs from homeowners you know or work with, and make sure you will have sufficient income to cover them. Owning a house when you do not have a full time job can be a recipe for poverty.
Towger:
Here:
More bedrooms = higher rent = higher value = easer to resell. 2 bed houses are also not as suitable for a family... Unless the large rooms can be properly divided, meeting all building codes etc.
Houses are going up on average €2k a month here, after a recession. About 11% a year. People who did not buy during the recession are now being screwed, as rents are rising faster and have just surpassed boom highs.
There are very few new houses being built, the remaining builders are all building office blocks, less messing and more profit. Current count on way to work is 16 large cranes. All these offices have been pre bought off the plans by companies leaving London due to Brexit. So they can't lose!
Edit: Just heard to the radio is that houses in Dublin are going up 4k a month.
Navigation
[0] Message Index
[#] Next page
Go to full version