OT: Buying a house

[david050173]

If you buy a house how much money will you throw away on interest? When you pay rent you are not throwing money away. You are giving it to someone in exchange for a place to live. Which one is better depends on a lot of things. Real estate is the hot investment right now. Doesn't mean it will be in 3 years. And leverage works both ways

[jakethebake]

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Fantastic, thanks a bunch...mods can delete this thread.
Sorry!

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Does this mean the topless pic will not be forthcoming? [img]/images/graemlins/frown.gif[/img]

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I have a finance guy at my bank that has helped me handle many things. He's the one who has planted the thought of buying a house and would be more than willing to help me find the best deal in my interests.

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This guy, no matter how scrupulous, cannot be regarded as an impartial advisor on the subject of whether or not you should buy a house. I am not surprised he suggested it.

[OtisTheMarsupial]

You currently pay about $1100 and feel like you're "tossing it away."

We'll begin with that assumption that rent is throwing your money away. You're forgetting the actual costs of maintaining appliances, landscaping, pool/rec room/ whatnot. If you buy a house, some of your monthly expenses will be "thrown away" too: You will likely have an HOA fee, repairs/maintenance expenses, loan interest payments, taxes...

This will be coupled with the gamble, yes, it's a gamble, that your house will actually increase in value. It may not. And even if it does increase, you might not actually make out on the deal. If you get trapped in a bad loan or if your boyfriend screws something up or if your agent's cut is too big or if you simply need to sell a little earlier than originally planned...

House buying is becoming more and more like car buying.

So, be careful about this. It might make more sense to keep rentinng and instead, take the extra chunk of money you'd pay for a house and invest it elsewhere.

[vexvelour]

Well, the investment part doesn't even really appeal to me. I have a really great mutual fund right now.

The thing about the market where I live is that there is a shortage of houses for rent. It's mostly a college town, and many 2nd-3rd year students are sick of random roommates, and looking for a house. This is how I'd go if I ever decided that I didn't want to live there anymore.

Thanks for the advice, everyone. Keep it coming.

[jaydub]

Otis,

Actually the "tossing away" fact you are missing is how little equity is gained in most loans during the first few years. That is where most first time buyers are woefully misguided wrt loan structures. The cost of maintenance is much more widely understood.

Gamble is not the correct word. It is an investment that carries substantial risk but terming it a gamble is highly misleading.

How is house buying like car buying? That made no sense to me.

J