Author Topic: Is it a good idea to buy a house when we're not FI?  (Read 4040 times)

ichangedmyname

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Is it a good idea to buy a house when we're not FI?
« on: March 01, 2014, 07:54:04 AM »
Background: We are planning to retire in the Philippines where the COL is low.

My husband wants to put a downpayment on a house and pay it off in 5-10 years. Since it's going to be in the Philippines, here's the kicker: I stay here in the US and work and he'll be there for a couple of years until my MIL retires and would then move in to the house.

I'm trying to run the numbers but since we haven't really found a house I can't really do that yet, just a lot of assumptions. We are going thirdsies on this house (husband, me and MIL) While husband is there MIL and I will move to a much smaller apartment  so our rent could be lesser.

Does it make sense to make payments on a house AND pay rent at the same time? This is my husband's plan. He wants to start it right now since my MIL is retiring soon and would need a place to stay as her SS is not enough for her to live on in the US but will be more than enough in the Philippines.

Living away from my husband would be ok I guess. The purpose is so I can lower my expenses here but we haven't talked about where HIS income is gonna come from.

I don't know if this is a good idea or I'm being pressured into thinking it's a good idea or it's just NOT a good idea. I'm about 10-15 years away from FI. Why would I invest on something I cannot live in til then? Well, maybe use it for when I vacation there.

I need mustachian wisdom. Thanks.

arebelspy

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #1 on: March 01, 2014, 08:09:28 AM »
Buying the house for the MIL reminds me of JLCollins' recent blog post where he talks about buying a condo for his Mom.

http://jlcollinsnh.com/2014/02/20/case-study-10-should-josiah-buy-his-parents-a-house/

Definitely worth reading.
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ichangedmyname

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #2 on: March 01, 2014, 08:26:35 AM »
Thanks rebel spy! That was quite interesting.

Foreigners cannot own houses in the Philippines. The carrot my husband is dangling infront of me is the fact that I would actually be the named owner of the house but would only pay for 1/3 of it. And he said MIL doesn't have long to live due to health problems so we will get to enjoy the house longer by ourselves.

Something about it doesn't feel right. Like I don't wanna be on the hook to make monthly payments for it on top of my current monthly bills. Am I being a bitch? I feel like if I say no both of them will take it personally and my husband thinks I don't wanna "share my wealth". I just wanna make sure we can afford it. But when I make decisions it's "emotional" and not "real". I don't have a plan for a house. YET. My networth is barely $15k right now. Sheesh.

SwordGuy

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #3 on: March 01, 2014, 08:34:45 AM »
Buying the house for the MIL reminds me of JLCollins' recent blog post where he talks about buying a condo for his Mom.

http://jlcollinsnh.com/2014/02/20/case-study-10-should-josiah-buy-his-parents-a-house/

Definitely worth reading.

And the MMM award for best advice given today goes to ... (drum roll please...)  ARebelSpy.

arebelspy

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #4 on: March 01, 2014, 08:54:39 AM »
I feel like if I say no both of them will take it personally and my husband thinks I don't wanna "share my wealth".

Share the JLCollins' article with your husband.  He may relate to it even more than you, being it's written from the son's perspective...
We are two former teachers who accumulated a bunch of real estate, retired at 29, and now travel the world full time with two kids.
If you want to know more about me, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
We (rarely) blog at AdventuringAlong.com. Check out our Now page to see what we're up to currently.

ichangedmyname

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #5 on: March 01, 2014, 09:26:14 AM »
The comments are great, too. Thanks so much.

phred

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #6 on: March 01, 2014, 01:39:17 PM »
Egads!  Don't do this.  Fifteen years from now, when you move out there, house will need to be completely re-roofed and utilities updated.  Meanwhile, if you've read MMM's opinion on having a cottage, you will now have two households needing appliances, furniture, linens, lawnmower, automobile, etc.
  Since your husband isn't a native, it may be difficult for him to get a work permit with you still in the States.
  Plus, there is the old husband's saying that two women under one roof do not make for the best of times.
  Better:  You and your husband move into that smaller, cheaper apartment now to free up some cash.  Also, contact your MIL's church about any retirement communities they may be associated with.
   Once you do move out there, a separate little cottage called the MIL's room -- either in the back yard or attached to the side of the house -- generally works a lot better.  You can always rent it out later.

Tai

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #7 on: March 01, 2014, 05:29:46 PM »
I used to live in Central America and there were a lot of poor but pretty and young girls who would pursue any man alone that they thought had money. I don't know what the culture in the Philippines is like, if it's that way at all. Do you really want your husband living there alone without you for 15 years? Even if you could afford it, it doesn't seem wise. You said yourself "Something about it doesn't feel right." I think you should trust yourself on this one.

ShortInSeattle

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #8 on: March 04, 2014, 04:42:39 PM »
Are you really OK living in a different country than your husband? I know all relationships are different, but that sounds truly horrible to me.


Hugh H

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #9 on: March 04, 2014, 04:48:34 PM »
I used to live in Central America and there were a lot of poor but pretty and young girls who would pursue any man alone that they thought had money. I don't know what the culture in the Philippines is like, if it's that way at all. Do you really want your husband living there alone without you for 15 years? Even if you could afford it, it doesn't seem wise. You said yourself "Something about it doesn't feel right." I think you should trust yourself on this one.

I've been to the Philippines many times; it's very much like that. He would have women, young and old, throwing themselves at him. Hope he has very good self-control.

expatartist

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #10 on: March 04, 2014, 07:00:32 PM »
@ichangedmyname What a tough situation you're being put in. If you say no, you're not taking care of your MIL. If you say yes, it means you're committing to a future of working to stay separated from your husband. DH and I have been separated for as long as 18 months (working in different countries) and it wasn't easy, but we managed. 15 years however, seems a bit extreme.

I wonder:
What would he be doing there?
Is he planning to work remotely?
Why would he be there without you, when the local labor market is so depressed? Because he wouldn't want his mom would be there alone? Why can't you make arrangements to share housing where you live now?

Nancy

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Re: Is it a good idea to buy a house when we're not FI?
« Reply #11 on: March 04, 2014, 07:52:47 PM »
This sounds like a bad idea for many reasons. Number 1: don't put yourself on the hook as owner of a house that you cannot afford to pay for by yourself if need be.