I previously posted about potentially buying a piece of property and I decided against it. The land was very expensive upon a little further digging. Now I've been casually keeping an eye out for a home. Here is all my details, all the numbers are my portion of expenses, does not include SO's expenses.
Current situation:Age - 27
Income - Appr. $3800/m and rising. My realized income is much lower because that figure includes 401(k) contributions.
Rent - $250/m in a prime location. We live above SO's parents who are uninterested in renting the apartment out except to family. The price is well below market rate for the location and size.
Debt - debt free
Saving's Rate - 73%
NW - 49k
Considerations for future home/future home purchase:- Interested in homes in a relatively small area of town due to bike accessibility.
- Do not want or need a large home or large lot. I'm not interested in the higher amount of upkeep either would require.
- SO still has significant student loan debt. Looking for someplace reasonable so she can still throw large money at it
- I've got about 13k in liquid assets I could put toward a down payment. I'm reasonably certain my parents would float me money to cover the rest if I asked.
- I'm handy and while not exactly looking for a fixer upper, am interested in someplace I could build significant sweat equity in
- I'm not sure where this falls, but prices seem to hover around $200/sq. ft. here.
Based on those criteria there are not many options available. However, 2 days ago the first viable option that meets all criteria popped up. Potentially buying a home seems much more real now.
Viable option details- 848 square feet w/ a small detached garage/shop
- 3050 square foot lot
- only two blocks away from where I currently live (i.e. the perfect location)
- estimated 15 year mortgage at 4.27% is $1079/m
- It's 93 years old and needs major updating, but it is fully functional and considering it's age looks to be in fine condition
- listed for 150k - $177/sq. ft.
- This is a high property tax area. Last year's property taxes were $1650 according to Zillow
I'd like to buy a home such as this because I'll likely be living here for quite a while and my current situation will not last forever (there will be younger members of the family whose turn it will be to rent this place). My current residence is also a little bit of a shithole, excuse my french. I've done quite a bit to improve it, but it's structurally unsound and since it's not my place I'm not getting too major with any of my repairs.
A place such as the Viable Option is well within my budget. If Zillow's guess is correct I'd be paying $500/m which is only double my current housing costs. Double sounds bad, but $250 is very low. I also like projects and would enjoy a slow one-room-at-a-time sort of remodel while we inhabit it.
OTOH it seems it could potentially be prudent to wait for the housing market to cool before looking to buy. Housing around here seems especially high. It would also be nice to have the entire down payment saved up by myself. Regardless, I'm actually going to make some calls about this thing and I'm kinda freaking out about it. Calling is a much more concrete action than just looking at an ad on Zillow.
I made this to flesh out my own thoughts as much as ask for advice. Part of me likes the simplicity of not owning a home, but there's a myriad of other things I'd like about owning one. If anyone has any words of wisdom as I pursue this potentially major life change I'm all ears.