Hello all,
I'm a long time lurker, first time poster. I'm thinking about making a financial move, and wanted to see if the forum had any advice for me.
Basically, I'm in Denver, CO and renting a studio for 700 a month including utilities. I feel silly throwing money at rent, when I could be building equity while providing myself hearth and home. I'm starting to look around the local real estate scene, and there are some decent condos, and some small homes and row houses available for $90,000 or below.
The issue I have is as follows. There is the possibility of my moving back to Michigan in 5 years or so. I can't say whether that will happen or not at this point. Because of that, I'm thinking of a 15 year mortgage to build up equity quickly. If I assume I'll be paying 3% in fees to buy the house, and 8% to sell it, I calculate that I'd be breaking even in terms of equity in about 2 years. After that, I would only be further ahead. If I did move, I would consider selling, or hiring property managers long distance.
Does this make good sense, or am I missing something? The mortgage rates are still pretty low, and I feel very positive about Denver's future population and economic growth, so I feel like I would be able to expect a lot of appreciation, but am not planning on it for this deal to make sense to me.
Thanks in advance for any comments!