musicjenny
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Post by musicjenny on Aug 12, 2015 9:43:34 GMT -5
When I got married we bought an old 4 unit with two one bedrooms and two two bedrooms. Lived in one of the one bedrooms and rented the rest to pay the mortgage plus made a profit until we got out of college. The whole building was 89K I believe. Very, very small apartment but it was just two of us and a dog. Then we bought what I would call a starter, 1950's 3/1 for 54K as a VA repo. Had a kid and sold it a few years later for 74K during the boom. Bought a few more times in the next five years and sold at a profit each time. Ended up here which was a 3/1 1960's rancher but in a good neighborhood. At that point we were foster parents - two bios, one adopted, and three teenagers weren't fitting. Turned the garage into 3 more beds and a bath. Now it's me, my kids and bf in a 6/2. I would still consider this a starter since it's older and needs updates. I paid 150 for it with about 20 for the addition and I think I could sell for about that given the condition. A lot of my acquaintances my age wouldn't live here. Not new enough, no fancy upgrades. We have the square footage but they'd rather drop 250-300K on a brand new house for two people, maybe one kid. They want what their parents have now when they're in their 20's and 30's.
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movingforward
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Post by movingforward on Aug 12, 2015 10:02:09 GMT -5
And I lost $20k after being in my house 8 years. I will say buying is cheaper than renting here by $200-$400 a month with the current interest rates. until something breaks and you have to pay for that yourself. that's a reason i haven't wanted to buy yet... I really like having someone else take care of issues. but now that my parents are retired... I can tell them to hop in their car and drive 18 hours to come fix something for me, if it comes with a big price tag Same here. I am not really a "do it yourself" type person when it comes to certain things. Also, in the last 10 years the property management company has bought me a new refrigerator, new dryer, new disposal, and new AC unit. This is one reason why if I buy I would really like something on the newer side. I really don't want to get into a money pit situation. I realize that eventually things are going to break down but I don't particularly want to put 20% down on something and then ALSO have to spent a ton of money repairing crap as soon as I move in. It is either going to be newish or already refurbished.
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cranberry
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Post by cranberry on Aug 12, 2015 10:12:35 GMT -5
until something breaks and you have to pay for that yourself.
that's a reason i haven't wanted to buy yet... I really like having someone else take care of issues.
Same here. I am not really a "do it yourself" type person when it comes to certain things. Also, in the last 10 years the property management company has bought me a new refrigerator, new dryer, new disposal, and new AC unit. This is one reason why if I buy I would really like something on the newer side. I really don't want to get into a money pit situation. I realize that eventually things are going to break down but I don't particularly want to put 20% down on something and then ALSO have to spent a ton of money repairing crap as soon as I move in. It is either going to be newish or already refurbished.
I feel the same way. This morning I'm having a new refrigerator delivered to the apartment. Granted, it's one the landlord chose, but to me, a fridge is a fridge. It was nice to just call management, have them send out a repair person, and have them arrange the replacement. Not that I can't do these things myself. But it was so much less hassle.
I know the mantra/rule of thumb is to buy a home. And I've owned two homes. But right now, renting appeals to me. It's cheaper than buying - for me, for now. I know I'm not building equity in anything. I might not have a paid off mortgage by the time I retire. But for now, this is what suits. If I find a small starter home that has what I want, then I'll consider buying again.
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phil5185
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Post by phil5185 on Aug 12, 2015 10:41:12 GMT -5
But - but - surely you realize that, as a renter, you paid for "new refrigerator, new dryer, new disposal, and new AC unit"? I'm a landlord, my tenants pay for the things you listed plus painters, new roofs, my property taxes, my insurance, pay my property manager, plus pay me a profit? Those things on your list are only a phone call away, no DIY involved, lol.
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emma1420
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Post by emma1420 on Aug 12, 2015 10:52:16 GMT -5
I made $40k with a $5k investment in 4 years. And that was not even when real estate was crazy hot. If you buy a house and don't take money out of it, you end up with something. Even if you don't maintain it or improve it - it is still worth something. Granted a lot of people lost their shirt on buying a house - but that wasn't a normal market. Markets are all different. In a market like mine where renting is slightly more expensive than purchasing, buying makes a lot of sense, even if you know you aren't going to stay in that house. That is not true in all markets - so you might be doing the right thing. And I lost $20k after being in my house 8 years. I will say buying is cheaper than renting here by $200-$400 a month with the current interest rates. I've been in my house almost 13 years. I might be able to break even if I sold now. However, I would still rather buy. Despite the maintenance, I prefer having the control, and buying, at least in my area, gets you more house for a much lower monthly payment. If I rented a place the same size as mine, I would be paying an extra $200-$300 a month on top of PITI.
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movingforward
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Post by movingforward on Aug 12, 2015 11:20:21 GMT -5
But - but - surely you realize that, as a renter, you paid for "new refrigerator, new dryer, new disposal, and new AC unit"? I'm a landlord, my tenants pay for the things you listed plus painters, new roofs, my property taxes, my insurance, pay my property manager, plus pay me a profit? Those things on your list are only a phone call away, no DIY involved, lol. Yeah, I know... that is one reason why I am looking to buy next year. I realize it is all a mind game. Paying 10K for a new AC unit all at once just hurts more than paying a few extra bucks in rent each month. I still say renting suits some people better. The YM way is not the ONLY way to make it in life.
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Deleted
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Post by Deleted on Aug 12, 2015 11:29:53 GMT -5
I don't see the point of a starter home. It seems like a waste of time and energy to me- I know I am very UN-YM. I am 35 and have been renting since I went to college. I only recently feel like I want to buy something... Honestly until now I didn't know where exactly I wanted to settle down. And honestly even now I am only 70% sure. Chicago is a big city and the neighborhoods change a lot. That gives me pause. Sent from my HTC One_M8 using proboards I could have never got into the house I am now without the starter home. Houses were appreciating faster than I could save, so getting into the starter home let me "save" by building equity. I bought my first at age 21, but it was only 42K. I sold it for double what I paid 7 years later so that's what I used for the downpayment on the construction loan. I was only making maybe 12-15K/year then, so saving 40K in that period of time wasn't possible otherwise.
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sarcasticgirl
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Post by sarcasticgirl on Aug 12, 2015 11:36:09 GMT -5
I don't see the point of a starter home. It seems like a waste of time and energy to me- I know I am very UN-YM. I am 35 and have been renting since I went to college. I only recently feel like I want to buy something... Honestly until now I didn't know where exactly I wanted to settle down. And honestly even now I am only 70% sure. Chicago is a big city and the neighborhoods change a lot. That gives me pause. Sent from my HTC One_M8 using proboards I could have never got into the house I am now without the starter home. Houses were appreciating faster than I could save, so getting into the starter home let me "save" by building equity. I bought my first at age 21, but it was only 42K. I sold it for double what I paid 7 years later so that's what I used for the downpayment on the construction loan. I was only making maybe 12-15K/year then, so saving 40K in that period of time wasn't possible otherwise. I suppose I see the point for someone else. I had ZERO desire to be tied down at 21. I was more interested in running off to Europe for the summer and having no commitments. I moved across the country at 25. and have moved pretty much every couple of years since then. at 35 I barely feel ready to commit to living someone for 5+ years.
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Deleted
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Post by Deleted on Aug 12, 2015 11:45:31 GMT -5
I could have never got into the house I am now without the starter home. Houses were appreciating faster than I could save, so getting into the starter home let me "save" by building equity. I bought my first at age 21, but it was only 42K. I sold it for double what I paid 7 years later so that's what I used for the downpayment on the construction loan. I was only making maybe 12-15K/year then, so saving 40K in that period of time wasn't possible otherwise. I suppose I see the point for someone else. I had ZERO desire to be tied down at 21. I was more interested in running off to Europe for the summer and having no commitments. I moved across the country at 25. and have moved pretty much every couple of years since then. at 35 I barely feel ready to commit to living someone for 5+ years. And to me, moving every two years sounds like hell. I'm a planter. I've only lived in 5 places my entire life and 3 of them were under 18 with my Mom.
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chiver78
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Post by chiver78 on Aug 12, 2015 11:56:16 GMT -5
I don't see the point of a starter home. It seems like a waste of time and energy to me- I know I am very UN-YM. I am 35 and have been renting since I went to college. I only recently feel like I want to buy something... Honestly until now I didn't know where exactly I wanted to settle down. And honestly even now I am only 70% sure. Chicago is a big city and the neighborhoods change a lot. That gives me pause. Sent from my HTC One_M8 using proboards I could have never got into the house I am now without the starter home. Houses were appreciating faster than I could save, so getting into the starter home let me "save" by building equity. I bought my first at age 21, but it was only 42K. I sold it for double what I paid 7 years later so that's what I used for the downpayment on the construction loan. I was only making maybe 12-15K/year then, so saving 40K in that period of time wasn't possible otherwise. so much this. I bought my 1st place - a garden style condo - about a year out of school. I turned around and sold it at the height of the market, clearing almost $40k on it. I spent a little of it, and turned the rest into the down payment on the townhouse I sold last fall - the one I had zero business buying. in my time there, I found YM and managed to not lose the place, and learn a few things along the way. I'm now in my first SFH, and I plan to stay here for a long time. I moved around a bunch between the two condos, and I couch surfed last fall while I found my home. I am done moving for awhile.
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formerroomate99
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Post by formerroomate99 on Aug 13, 2015 21:34:51 GMT -5
I think townhouses are a great place to start out. You still have a driveway, garage, and back yard. I get that having windows on the sides can help with ventilation and having some distance from your neighbors is nice. But on the other hand, shared walls does wonders for your utility bills and you don't really do that much with a side yard.
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cranberry
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Post by cranberry on Aug 13, 2015 21:52:38 GMT -5
I'm confused about what a townhouse is, exactly. I've heard of townhouse style condos, which have 2 floors. But is a townhouse another type of ownership, different from a condo or a SFH?
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wvugurl26
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Post by wvugurl26 on Aug 13, 2015 22:29:54 GMT -5
I think townhouses are a great place to start out. You still have a driveway, garage, and back yard. I get that having windows on the sides can help with ventilation and having some distance from your neighbors is nice. But on the other hand, shared walls does wonders for your utility bills and you don't really do that much with a side yard. Some townhouses have big side yards. The end units at my friend's place have pretty big ones and the entry is to the side not the front.
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cronewitch
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Post by cronewitch on Aug 14, 2015 3:30:53 GMT -5
I bought a house in 1985 for 51.5K I would call a starter house it was 1140sq ft. It was like getting a free house. I mortgaged 40K at 422 a month when my rent had been 390 and was going to 410. Less than a year later I got a roommate paying me $300 to live in my house. I sold it for 90K in 1994 without improving it at all just replaced the roof and gutters ourselves. So 40K profit after low cost living and was able to move to the bigger house and raise the roommate rent. Now this house has risen slower so up maybe 150K and payments lower than most rent especially after deducting roommate rent. I have spent about 50K on repairs and replacements in 23 years.
One thing about starter houses is you might end up in them 30 years if life is tougher than you dreamed. My niece bought a 1 bedroom condo as a starter then mom bought it from her and sold it to her brother. He was being irresponsible but the worst that could happen if living in a one bedroom until he earned enough to buy a house and after a few years that 40K condo is cheap living. He got a tiny 3 bedroom 1 bath house about 15 years ago, kinda wants to sell it but not have to clean it first so he could still be in that little house until he dies.
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gooddecisions
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Post by gooddecisions on Aug 14, 2015 6:28:33 GMT -5
I too have not been able to capitalize on home appreciation. I bought my first place in 2004, 11 years ago, for $165K. Neighbors' homes were selling for $205K in 2007, but everywhere else was also at least $50K higher. Then 2010 it dropped down to $155K and now it's right back at $165K. So, I've been renting it the past 2 years at just barely above break-even. I wouldn't say it's been a great investment.
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seriousthistime
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Post by seriousthistime on Aug 14, 2015 8:19:55 GMT -5
In the MCOL town where I live, starter homes are available but many of the houses with 2 or 3 bedrooms, one bath, 1000 sq. feet plus or minus, were turned into rentals, and the neighborhoods have turned bad. There's a high crime rate and the houses have fallen into disrepair. In my general area of town, there are houses with maybe 1400 sq. feet, maybe 1 1/2 baths, that could be starter homes, near elementary schools. But there are not many of them.
The new subdivisions have what they consider "starter" homes, over $200K, maybe 1600-1700 sq. feet, 2 baths, two car garages, with the glitzy stuff -- stainless steel appliances, granite countertops, and so forth. But by far, the builders prefer to build the McMansions. They are also building upscale student rental complexes, which is contributing to the decline of the old single family neighborhoods. The students who used to rent those places are going upscale. But some of those upscale places are crime magnets, especially when the builders raze houses adjacent to the not-so-great neighborhoods. Turns out that not all "students" come to town to get an education.
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Deleted
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Post by Deleted on Aug 14, 2015 8:33:11 GMT -5
I wish it would be popular to build the old 50's style 1200-1500 square foot ranch again. I think about downsizing but a lot of the houses that are smaller are also very old. I don't mind old, but I do like the fact that my 3500 square foot house is as cheap or cheaper to heat/aircondition as my old 1200 square foot place and that everything is up to current building codes.
I always thought a builder could make a killing creating a subdivision with reasonable priced/sized new places but maybe not. Maybe the demand is just for the McMansions and if you can put just as many huge places for twice the price on the same sized lot...
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haapai
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Post by haapai on Aug 14, 2015 9:36:42 GMT -5
It might be worth noting that in places where starter-sized and priced homes still exist, a surprisingly large number of the buyers are single and childless.
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zibazinski
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Post by zibazinski on Aug 14, 2015 9:43:21 GMT -5
There's a subdivision close to me where it looks like there are starter homes. They are duplexes which I would like to have if I could own both of them. I'd live in one and rent out the other. They are attached by their garages so no noise really. Unfortunately, unless you build in that subdivision its impossible to get both sides and the vacant lots left are yucky location wise. But I think that would be a great plan. They are all one level, 3 bedroom, 2 bath, 2 car attached garage and about 1600 sq ft. Laid out very well, no space goes unused. I'd like to steal that floor plan and find a good sized lot and do it. My costs could be offset by having a tenant.
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Deleted
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Post by Deleted on Aug 14, 2015 10:20:41 GMT -5
Yes, a duplex is something else I keep my eyes open for, but not real common around here. I wouldn't mind a renter paying the mortgage and it would be easy to keep an eye on the property if it was attached.
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Chocolate Lover
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Post by Chocolate Lover on Aug 14, 2015 11:00:06 GMT -5
I wish it would be popular to build the old 50's style 1200-1500 square foot ranch again. I think about downsizing but a lot of the houses that are smaller are also very old. I don't mind old, but I do like the fact that my 3500 square foot house is as cheap or cheaper to heat/aircondition as my old 1200 square foot place and that everything is up to current building codes. I always thought a builder could make a killing creating a subdivision with reasonable priced/sized new places but maybe not. Maybe the demand is just for the McMansions and if you can put just as many huge places for twice the price on the same sized lot... There are some builders around me that build what I tend to call the cracker box houses. Rectangular, very little in the way of hallways (which I like) and around 1100 to 1300 square feet, with no garage. They generally build for customers though, not in subdivisions. Now and then someone decides to build themselves an 800 sq ft house. You get 1500+ 3 or 4 BR houses in subdivisions around me.
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zibazinski
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Post by zibazinski on Aug 14, 2015 11:10:14 GMT -5
DH would like a small house with a four to six car garage. Love it, a garage with more room than the house. Sigh.
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Chocolate Lover
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Post by Chocolate Lover on Aug 14, 2015 11:16:25 GMT -5
I've seen people with more room for the toys than the people.
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Deleted
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Post by Deleted on Aug 14, 2015 12:01:23 GMT -5
I wish it would be popular to build the old 50's style 1200-1500 square foot ranch again. I think about downsizing but a lot of the houses that are smaller are also very old. I don't mind old, but I do like the fact that my 3500 square foot house is as cheap or cheaper to heat/aircondition as my old 1200 square foot place and that everything is up to current building codes. I always thought a builder could make a killing creating a subdivision with reasonable priced/sized new places but maybe not. Maybe the demand is just for the McMansions and if you can put just as many huge places for twice the price on the same sized lot... There are some builders around me that build what I tend to call the cracker box houses. Rectangular, very little in the way of hallways (which I like) and around 1100 to 1300 square feet, with no garage. They generally build for customers though, not in subdivisions. Now and then someone decides to build themselves an 800 sq ft house. You get 1500+ 3 or 4 BR houses in subdivisions around me. Around here the ones they are building are ginormous. Minimum 3000 square feet 3 car garage. 3 levels. A lot of childless, or single or empty nesters aren't going to want all that space. It would be nice if there were more options in the newer house market than small condo or huge single family.
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DagnyT
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Post by DagnyT on Aug 14, 2015 12:42:05 GMT -5
DH would like a small house with a four to six car garage. Love it, a garage with more room than the house. Sigh. Zib, Your husband must be related to my husband.
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zibazinski
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Post by zibazinski on Aug 14, 2015 15:23:13 GMT -5
You have my empathy and. Sympathy. .
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