The trust in myself has been seriously tested over the last 24 hours. I got what my mortgage payment would be and it is higher than I thought. Pushing me to my total limit. My dad, of course, came out guns blazing, freaking out. So we had our differences last night. I am stuck making a huge decision which is so gray, and I cannot afford to be wrong on it.
Do I take the risk, take this house, praying nothing major goes wrong with it, because I don't have the emergency fund to fix anything major with that kind of monthly payment, or do I hold tight, risking not getting anything near what this house is?
It's a seller's market. Will the bubble burst anytime soon? I don't know. Basically, if I make this decision and I am somehow wrong, I get a huge "I told you so, sorry, can't help you"
If the numbers were absolutely too high, this would be easy. But they are on the cusp. DO I take a risk, or don't I? Do I just hope something else comes along as nice for much cheaper?
I really don't know and I have to decide ASAP.
My metal fortitude is weak. But I am from Brooklyn, and I have faced much greater challenges, and I have landed on my feet. Thank you UR.
As far as hatchet guy as I will call him. I did say something yesterday. I told him I was getting mixed signals and if he wasn't interested, he can be straightforward. He said he was and we had a phone convo last night. Dating, and online dating causes many challenges. After getting ghosted, or the slow fade, or seeing so many people's different communications patterns, you just don't know anymore. So we had a good convo, he is indeed interested, (scared I ruined it by saying something, but I am all for communication these days, and if someone can't handle honest communication, they aren't for me. he does have his son on a 50% schedule. He said the plus side is, and I didn't even know he did this Friday, is his brother rents from him and that means he has a built in babysitter. His brother watched his son last Friday. He puts his son to bed, is there when he gets home in the morning. So he said maybe he will see if his brother can do that Saturday night.
So much going on. I am mentally exhausted. I need some clarity, because I don't have that right now.
It's an easy decision. You have to get money from your Dad to buy the house and you're marginal with regard to the monthly payment. You can't afford the house. If you buy the house, you'll become a slave to the house. Why would you want to do that?
I think this administration reimplemented deregulation banking policies like they did before the last housing policy.
Anyone here know more about that? That could indicate another bubble.
Its definitly a sellers market. I am seeing shacks go for half a million. But theres also a lot of preforeclsures.
I guess you have to weigh what you would spend in rent.
From what i have seen, something always goes wrong with a home. You will have to put money in it. So if that will lead you into foreclosure i wouldnt do it.
Doodler, that 30 percent rule doesnt apply here. We make the same salaries sometimes less then other regions yet the the taxes, home costs are crazy here. Most people (professionals) work a min of 2 jobs to afford a home. Single income families are rare. Rents are insane and unstable as well. Like 1000 a month for an illegal 1 bedroom basement apartment 2 hours from the city 10 years ago in a poorer neighborhood and not including utilitites.
Thats why we have the reputation for rudeness and neurosis!
I spend a lot of time listening to Bloomberg's analysts and other economists - yep - I'm just that exciting.
Be prepared to yawn and fall asleep.
A key function of household affordability is the mortgage interest rate. It's taken as a given that rates are on their way up as the Federal Reserve normalizes rates and reduces their quantitative easing more. Here in Upper Middle Kanukistan the government has both allowed rates to rise and also introduced stress tests for buyers requiring them to be able to sustain a few extra points of interest before they would back the loan through CMHC (kinda like Freddie / Fannie).
I'm also hearing some disturbing noise about more investors going to cash and a "normalization" of volatility. We've been in this up cycle for quite a long time. Much longer than normal and a lot of very smart people seem to be bracing for a downturn. The risks of a downturn increase with the possibility of a systemic shock like - say a trade war between Western economies. There is also a lot of turmoil in parts of the world associated with oil production that increases risk of a systemic shock.
How will this affect house prices? In Brooklyn? I have no bloody clue which is why I'm intending on investing in a new quit to keep warm and a new roof to stay dry
But it can be a given that borrowing costs are only going to be going up in the short term at least.
On BD H52, W50 T27, M26 S21, D23 BD-9-Mar-16 D-15-Jan-18 Final-19-Apr-18 I am a storyteller. The story may do you no good. But a story is never for the listener. It is always for the one who tells
I agree with Doodler. If you don't have savings to handle financial emergencies you're not prepared to be a homeowner.
Things happen. Roofs leak. Dishwashers break. Water heaters break. Pipes clog. You must be financially prepared to handle these things.
PLUS - you REALLY don't know where you want to be. You complain all the time about this town, so why buy there? Sounds like mortgage and property taxes and repairs and maintenance will be more than rent, I'd skip it.
You really only build equity a few ways: -Sweat equity - buying a fixer upper for a below market price and doing most of the work yourself. I've done this but it's exhausting and requires time and skills; your energy is better spent elsewhere right now.
-Buy and hold forever - yes, if you buy a house and live in it for twenty years you will have some equity - although it's not as good an investment as most people think. You're not in a position to make that commitment.
-Buy at the bottom of the market. This is tricky because most people don't have money when the market is down because the economy is also down. However you have pretty good job security in healthcare even in a recession so you might be in a position to take advantage of the next recession if you save up.
- Buy a property that is also a rental - like a place you can have roommates or convert a basement to an apartment or a duplex. Being a landlord has its own problems but you're putting their money to work for you.
juju is absolutely right. Unfortunately, in the region we live in, rarely is anyone able to follow the "rules" of home ownership. It's nearly impossible unless you have a 2 high earning income household.
I don't live in Brooklyn, anymore, although I am not far from it. You have to be among the rich and famous to buy in Brooklyn these days,
I am stuck in not the best spot. Leaving town is a non-negotiable for me. It is not a wise decision for my daughter. I would have to leave the state all together for it to have any positive financial impact, and that is just not doable thanks to laws and jobs and my daughter needing her father in her life. One town left, or one town right the prices are equal or higher.
I do not have the luxury of waiting for the market to be low. I will be kicked out of my home soon.
There is no rental in town any cheaper. I have the last one.
I would not be a landlord. I could go buy the house I live in now and become one. That responsibility is not physically and/or financially doable.
Well, my dad kind of decided for me. I withdrew my offer. It does not feel like the right move in my gut. I spoke with the mortgage broker and he honestly felt like buying this home was the right move. There were a lot of variables to be considered for the pros and the cons. It wasn't so black and white. But in the end, I can't make a decision that does not make the family comfortable.
My dear child told her classmate who we would be living next door to that we got the house along with every one else. She is heartbroken. I wish she hadn't said anything, but despite how many times I warn her to keep personal business personal, she has no filter and blurts everything out.
This has been a bad week.
I beg, please, just understand the right decision for my daughter is staying in town and not moving out of state. Sure, you can everything is a decision, but this is one that had to be made. It is not an option on the table whatsoever.
Well, looks like I'm late to the party but I think you made the correct decision - for whatever that's worth.
But perhaps now is the time to start planning better for the future????? By that I mean, what about socking away some additional money? And don't say it cannot be done because nearly always it can. It's amazing how when someone is making $90,000/year (not saying you) they sometimes think they can't cut or save. Then, they lose their job or get cut to $60,000 and manage to shrink their spending to fit their new income. I've seen this time and again where people will spend what they have but shrink it when they absolutely have to. We spend what we have. The trick is to shrink it when you don't have to. There have to be things you can cut - I know there are. If you could somehow put 10% of your income away for a couple of years you'd have a cushion, a fall back for house repairs, or a down payment. Financial planners can really help with this. I don't know enough about your specifics to say where this might be found. For some it's as simple as stopping Starbucks three or four times a week and going out to dinner three or four less times a month. It may be a different car and car payment. It might start with different car insurance, a cheaper cable or no cable plan. But specifics aside it can be done and would put you in a better place for the next time.
As for the moving - again, anything is possible. You may be choosing not to and with good reason, but people do it all of the time.
Finally, did you ever really check into this eviction thing? Ever listen to Handle on the Law? I'd put in the website but can't. Anyhow, I've heard him talk several times about this very topic and it is very city and state specific. I've heard him tell people who are about to or have purchased a duplex or 4 unit to just give up - there is no way they are going to evict the people living there based on the rules of their jurisdiction. In general, it's not really as easy as - "I bought the building and you have to go." It just does not work that way - with exceptions of the buyer is going to move in him or herself or they are doing a total remodel. If you have not fully checked this out - please do.
Don't set up strawmen to be torn down. "I will be kicked out of my home soon." And you are 100% positive of this why? Or "There is no rent in town any cheaper." Again, I'm sure there is - of course it may also come with trade offs, but it's likely somewhere.
I don't want to beat you up too bad here as I know how crappy this all is. But, everything happens for a reason. I can't tell you how many times I missed out on something only to find something so much better. Had I not missed out, I'd have been stuck with the inferior whatever it was. No one knows what the future holds for the market or housing or any of it. I'm of the mind that we still have a ways to go and have remained just as invested as I was 5 years ago during this run up. I moved a few things around but that's it. I know less about real estate but from what I can tell, we may still have a ways to go here as well. It's clearly a sellers market. Sadly, the better time to buy was a few years ago. That said, I think we'll be saying that again a few years from now.
DonH Midwest Me 56 WAW-EXW 55 Met 11/95 / Married 5/00 Bomb 6/20/05 / She Filed on 6/2/06 / Divorced on 10/9/06 4 who'd qualify as GF since D & dated about 25 women since D
When people buy a rental unit (not saying you) they usually budget the mortgage payment and taxes as just 70% of the cost - with the remaining 30% going to maintenance and repairs.
So if this new place with PITI (don't forget the insurance) was going to cost as much as rent, (after figuring in the tax benefit which for you may not be that much as your taxes as a single mom are already probably lower) then renting is actually cheaper than buying still (because you dont have the additional 30% cost for maintenance and repairs).
I am on the opposite side. Take the risk, if you need to do so get a room mate.
Just do it, get on the ladder. And then chip away at the mortgage, sell second hand clothes on eBay, eat bread and jam. If an emergency crops up handle that bridge as you cross it.
My thoughts
V
Freedom is just another word for nothing left to loose. V 64, WAW
