Author Topic: Should I buy a house/condo or wait (DC area)?  (Read 6320 times)

Imustacheyouaquestion

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Should I buy a house/condo or wait (DC area)?
« on: June 25, 2015, 03:20:01 PM »
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« Last Edit: December 07, 2015, 08:22:22 AM by Imustacheyouaquestion »

WranglerBowman

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #1 on: June 25, 2015, 04:22:32 PM »
Now is probably one of the best times to buy, lots on the market in the DC area and low interest rates that don't sound like they will last much longer.  I couldn't stand pissing away rent money every month so I bought.  If your handy and have time to work on a house I would def buy a fixer upper, two years is just the right amount of time to fix up a home and sell it for a profit (in theory based on improving market) and then take all your DC money and move to a lower cost of living area.

ShoulderThingThatGoesUp

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #2 on: June 25, 2015, 04:40:16 PM »
Why do you think you can't develop your career someplace you like better? And if you're right, won't you succumb to One More Year, year after year?

Schnurr

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #3 on: June 25, 2015, 04:45:26 PM »
Would you mind sharing a few more details? Where do you live now, where do you work? What areas are you considering for options 2 and 4? It might help some of us who know the area identify some options besides a 400k condo in the city or a 400k house in the burbs. For example, we bought about a year ago, inside the District, walking distance to Metro, for far, far less than 400k.

However, if you really think you'll only be here for two years, I would be hesitant to buy unless you are willing and able to buy a fixer upper and flip it while living there. Totally agree with ShoulderThing... be honest with yourself as to the likelihood that you will be ready to head back to that Southern town in two years. And if it's that easy, why wait two years in the first place?

ZMonet

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #4 on: June 25, 2015, 04:47:19 PM »
With all the variables you have going on in your life, and your desire to leave the area, I don't understand your rush to get tied to a property.  Are you paying a bit more?  Yes, but you have the option to leave virtually whenever you want.  For someone in your shoes, it is invaluable to have that option.

With that said, if your commute is an hour you could do a lot better in the suburbs of Maryland or Virginia.  Fairly easy commutes on VRE (Franconia-Springfield or Lorton) or via commuter bus (w/ WiFi) from Southern Anne Arundel or Calvert Counties. 

mozar

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #5 on: June 25, 2015, 04:53:10 PM »
I disagree about being the best time to buy.
« Last Edit: May 10, 2018, 01:00:44 PM by mozar »

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #6 on: June 25, 2015, 05:00:44 PM »
I live in Washington, DC with my girlfriend of 3 years - it's a serious, committed relationship and we plan to get engaged in the next year or so. However, because I know life happens, I don't want us to sign a mortgage together until we are legally married. My plan is to qualify for a mortgage based on my income and she would pay me rent each month.

I don't like living in this region (Cost of living is too high, time spent commuting is too long, "inside the beltway" myopia is a real thing, everyone here has terrible work-life balance, etc.), but we have both agreed to stay here for at least the next two years to help advance our careers...

Wow.  I stopped reading right after that "two years" statement.  In your shoes, I would absolutely defer a housing purchase for that 2 years, save my money and then buy wherever I/we decided we were going to relocate.  Two years is the blink of an eye in real estate (IMHO) and therefore you don't buy if you know/think you might be moving.

And... given how much you dislike the area, I would expect you to move.

Telecaster

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #7 on: June 25, 2015, 05:05:32 PM »
I don't like living in this region (Cost of living is too high, time spent commuting is too long, "inside the beltway" myopia is a real thing, everyone here has terrible work-life balance, etc.), but we have both agreed to stay here for at least the next two years to help advance our careers...


...Words of wisdom from other folks who have been marooned in high cost of living cities where they wanted to escape? I think my biggest concern is that I've been here two years already (wasn't sure how long I planned to stay). I don't want to wake up in 5 years, still paying an absurd amount to rent, and kicking myself for not having bought a place when I first had the chance.

The problem is, as always, we never know exactly what the future will hold.  But here's the thing:  As a rule of thumb, the longer you stay in a place, the more attractive buying becomes.   By "attractive" I mean the more likely the odds will work out in your favor.  It sounds like you really want to get out of there, so plan on getting out.   You have short-ish term housing needs, so think short term.  It is certainly  possible you wake up in five years and say "Shit!  I was an idiot!  I never should have bought a place!"     So don't buy.  That will just make it harder to get out of there, which is what you really want to do.






mm1970

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #8 on: June 25, 2015, 05:11:49 PM »
I think it really depends on whether you want to stay or not.

You say not, but do you have a plan to move?  I had a friend who lived in DC and rented for years, but she wanted to move, and managed a transfer to NM for her job.

Do you have plans?  Real ones or vague ones?

I cannot speak for the current DC housing market.  I lived there in the 90's.  I rented inside the beltway (Ballston, Crystal City) and had short commutes.  My friends without kids tended to buy smaller townhomes/ condos, closer to work.  And no, they didn't have work/life balance, and they still don't.  They work like dogs.

My friends with kids went outside the beltway, or thereabouts, and bought more house.

But with the market being what it is, at least two of my friends have "traded up" and have gotten larger homes and have moved closer to work, back inside the beltway.  Another friend traded up from a townhouse to a slightly further out single family home.  So that completely unscientific summary leads me to believe that it might be a good time.

HOWEVER, it all comes down to "do you want to stay?"

When we moved to So Cal, we rented.  My spouse was in grad school, we were never going to STAY.
Well it took him 7 years to graduate.  And we were hooked.  Had we stretched to buy a place in the 90's, we'd be sitting pretty.  But we didn't.
We bought in 2004.  House still worth less than we paid for it (ouch).

You never know if you are going to be the guy who doesn't buy the condo and ends up staying 10 years.
Or if you are going to be the guy like my nephew, who buys the house and then moves 2 years later and loses a bunch of money because the market tanked.
Which one is worse?

sunday

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #9 on: June 25, 2015, 05:14:31 PM »
If you only want to stay in the area for two more years, why not rent some place nicer? Then you wouldn't have to tie up your  capital, while potentially increasing your quality of life. I would not buy if you plan on leaving in two years.

mozar

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #10 on: June 25, 2015, 05:58:47 PM »
This seems like an upgrade to me:
https://washingtondc.craigslist.org/doc/apa/5088146296.html

How do you feel about group houses? You could get the master bedroom in a nice house that will probably have a backyard and a basement with people who might want to do projects with you:
https://washingtondc.craigslist.org/doc/roo/5076365134.html

Runrooster

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #11 on: June 25, 2015, 06:39:31 PM »
Don't take this the wrong way, but why do you live in a part of town you hate?  I would sacrifice space for an area you would love, especially since city living is a brief chance in youth.  The way I did it, I walked to my downtown job from a studio (technically a one bedroom), which put me a stones throw from a campus with many free activities, museums, art events.  Plenty of restaurants and night life and happy hours if that's your thing, but mine wasn't.  Running and biking trails, gym at work.  It felt sort of stupid to pay as much on rent as I did, but I spent no money on transportation, could go out on a Wednesday and still be at work at 7a.m., great exercise and safe. 

mozar

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #12 on: June 25, 2015, 07:37:26 PM »
Ah, you didn't say utilities were included. So the problem is not housing, it's your girlfriend.
I still don't think you're trying that hard. A
« Last Edit: May 10, 2018, 12:59:55 PM by mozar »

mozar

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #13 on: June 26, 2015, 12:59:57 PM »
Well I was being a bit facetious, I'm sure she's lovely. My point is that there are trade offs.

RequiemforEnnui

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #14 on: June 26, 2015, 01:08:21 PM »
First, I would definitely continue renting. Until you've put a ring on it (and gotten through your first year troubles as a married couple), do not tie yourself to a major purchase that way. Life happens, as they say.

Second, I'm living in the DC area as well, and while it's tempting to buy someplace I'm very cautious.  The simple fact is that there's still a whole lot of extra money out there looking for safe investments, and rental properties are one place that money's flowing. That means that any reasonably priced home in a decent area is going to have multiple bidders, and go for over listing price. Getting into bidding wars with investors is generally a losing proposition if you're looking for a residence.

As a result, I'm sticking put in my apartment. 1BR apartment in Pentagon City, about a block from the metro, on Blue/Yellow lines for about $1800 per month. Look for something like that - not much more money per month, but a lot better QoL and better commute.

If you do decide to buy, your best bets are probably going to be in the Anacostia area, but you're going to have to wait a bit for development to hit full swing there.

MissStache

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Re: Should I buy a house/condo or wait (DC area)?
« Reply #15 on: June 26, 2015, 02:10:52 PM »
I'd consider myself pretty qualified to answer this question because we just closed on our new house in Capitol Hill YESTERDAY!  We've been actively looking since October and have had one contract make it to within 3 days of closing only to have it turn into a probate nightmare, so it is an unspeakable relief.

We are in a similar situation.  Boyfriend bought the house and I will be paying him rent. We live together currently.  I wouldn't have opted for Capitol Hill myself because it is so expensive, but we actually managed to get a deal (by DC standards) on a little row house, so I can't really complain.  We live there now (only moving 2 blocks).
 
Please, let me urge you NOT to buy a condo.  We were looking at a similar thing at first, but after spending a lot of time talking to our WONDERFUL realtor, and my BF's wildly successful father who was a DC real estate attorney before he FIREd, we realized it's an awful investment.

Condos in DC are a dime a dozen, and there are literally thousands being built as we speak.  Selling a used condo is a real trial in this city, because you are competing with all of the new ones going up which have awesome amenities, builder finance incentives, and cheap-as-hell introductory condo fees.  It becomes even worse when there are other units available for sale in your same building.  It is not a way to make money.  Even unique and beautiful buildings in great locations are not immune (let me tell you about the poor sap who spent 1.2 million on a condo in an old school in Capitol Hill last October and just sold it this month for 850K...). 

If you are committed to buying in DC, please look for a house.  There are still "deals" to be had in places like Ekington and even Brookland, and if you have a high tolerance for "transitioning" areas then you can find some gems near RFK and Benning Road.  I don't know much about the northern parts of the city, but our realtor initially steered us to look in Columbia Heights as well.  Read urbanturf.com- it has wonderful neighborhood profiles. 

Personally if you are only planning on staying for 2 years then I don't think it is worth it.  I'm sure you can find a better apartment or maybe even a house.  Several of the houses we were looking at have been turned into rentals in the interim for not crazy amounts of money.  2 years isn't enough time to see it become a viable investment, and let me tell you that the hassle alone is enough to put me off of doing this again for a long, long time (and I didn't even buy the damn thing!).

Also, I echo a previous commenter that I think the DC bubble is going to burst soon.  We're planning on keeping this place as a rental if/when we decide to move, but will likely live here for a minimum of 5 years.  Hopefully it will recover by then, but we're actually anticipating losing some equity in the upcoming years...