We can't decide if we should buy a new house - who can help us?

[tkyes]

DH and I are on the fence about whether or not we should be looking at a new house.

Who can we talk to about our situation - to see if it is right for us or if it's the smart thing to do financially.

I would think if we talked to a realtor they would heavily push us to buy, even if it's not the right thing to do.


Any suggestions would be appreciated.


Thanks!

Tamie

 

[debster812]

Buy ME a new house, and I will tell you how it is.

Seriously, do you own or rent now? If you own, can you sell yours for a gain, as I know around these parts housing prices are through the ROOF.

Not sure who to check with, maybe a mortgage broker? But then again if they are on commission, they will want the 'sale' of your loan.

Sorry Tamie--could I be any *less* helpful today?

 

[christinou]

do you have a financial advisor, do you own a home right now, or you renting. Right now is a great time to get a mortgage, but the houses also seem to go really quickly....

 

[RNMOM]

Can I assume you already own a home now? Let me tell you what we did.

DH inhereted some money when his mom passed. Our house was a real fixer upper but all we could afford at the time. We had already stripped the inside, put new carpet and paint. We had put in new furnace, hot water and new drive. We had hand sanded and painted the outside. DH had a whiplash accident 5 years ago and is on daily pain meds now. He has treatments and therapy but it will never be well. Due to that I suggested putting new roof we needed, siding and new windows and doors in the house. It has really made an eyesore house a beauty. Our home is conservative, 1700 sq feet but nicely laid out. Last spring I talked him into a kitchen redo which I was able to do for about 13,000. That included the laundry room too. Considering all that was done that is not bad and included a couple new appliances. Our home is now "done" but for cosmetic changes. It helps that he does not have to climb on roofs and such to do any repairs.

In retrospect, the money would have been better spent on a different or new home. The interest rates were not so nice 3 years ago but were still pretty good. As much as I love this house and like my neighborhood, DH was right. The investment would have been better in a different home. We are still pretty happy hear and it is the way I wanted it to be.

If you have a home that does not meet the needs of your family by size or layout, you have a neighborhood that is not growing in value or you have a long commute that you could change by moving, do so. JMHO. Good luck with your decision.

 

[tkyes]

Yes, we currently own a home.

We have quite a bit of equity in it now as our area has grown a lot in the 4 1/2 years we have been there.

As of right now we don't *need* a new house. We haven't outgrown our house and we still like it. We know that in a couple of years if our family grows we will have definately outgrown it.

Our dilema is do we sit tight on what we have now, make a few more minor updates to it and wait those couple of years until we really do need a house, in the mean time saving money. Or do we look for a new house now that might be stretching our wallet a tiny bit but will give us some room to grow?

The houses that are in our price range are ok - not our dream house by any means but they would have more room. Part of me says we should wait, since we still love our house, that way we can build up more equity, save up more money and be one step closer to the next house being nicer than the ones we are looking at right now.

sigh

tamie

ps. sorry Deb, I can't buy you a house. I would have, until you admitted that you are responsible for infesting my office building with a family of mice!

 

[CajunDixie]

As of right now we don't *need* a new house. We haven't outgrown our house and we still like it. We know that in a couple of years if our family grows we will have definately outgrown it.
Our dilema is do we sit tight on what we have now, make a few more minor updates to it and wait those couple of years until we really do need a house, in the mean time saving money. Or do we look for a new house now that might be stretching our wallet a tiny bit but will give us some room to grow?

If a new house is going to stretch your wallet before you even have kids what will you do when you do have kids? Kids are $$$$$$ I would think you should buy now while you dont have the extra expenses of children. And right now with interest down so low its really a buyers market. If your area is anything like ours real estate prices are climbing steadily.

Possibly this website can help you. Fannie Mac

 

[Toby'sFriend]

hmmm - I just don't know if that's a decision anybody can make for you. It's more of a gut feeling kind of thing. Part of the problem is that while the value of your house is going up and you're building equity - the prices of the "next level" of houses are also going up. So that is a tough game to play without saving additional amounts in a savings account to help with the down payment.

Interest rates are incredibly low right now and it's hard to imagine that they will be any lower in 3 years. My guess is that they will most likely be higher, which means that your new mortgage might be at a much higher rate, which is a huge expense over the life of a mortgage. But that's just a guess, nobody really knows what is going to happen.

Anyway, I wouldn't talk to a Realtor or Mortgage Broker for advice. Their advice will be to sell and move. Perhaps a Financial Advisor like through Fidelity or someplace.... somebody that can look at your entire life .. college and retirment savings, houses, life dreams etc etc etc. Just don't go with anybody who works on commission for any particular product.

 

[jel0511]

To be honest with you Tamie, the time to stretch yourself financially if you want to, is before you have kids. Once you have children, they drain you financially in a different way, and then you'll be in a bind, since it will be difficult to stretch then, since you'll already be stretched more. If you really think you're going to need a bigger home in a few years, I can think of no better time to buy. Mortgage rates are at historical lows, allowing you to purchase a more expensive home. If rates continue to stay low, or go lower, if you bought a new house, you could just refinance to take advantage of lower rates. If rates go up, then you'll find yourself, yes, you'll be able to spend more, but you'll be able to afford possibly less, due to increased rates. You could always begin looking casually, and if that perfect home presents itself, then you'll be in the mindset to jump on it. Also, buying a home you intend on staying in for a while before kids also has advantages on being able to do the work before your kids begin to interupt!!! It is very difficult to get any work done anymore with a 5 yo and a 2yo around. We basically have to hire anyone, including painters now, since we can't do it ourselves without be constantly interupted. We've been in this house 4 years now, and the downstairs is finally completed. In terms of what makes financial sense, there really is no right answer. Selling your home, making a profit and sinking it into a larger house is a sound move. You just have to make sure that the larger payment and taxes are going to be within your constraints, and no one, can tell you that. I'd look at your current financial situation and see how much "extra" you have per month. If you can part with most of that and place it towards a larger house, then do it. Just remember, with a bigger house payment, usually comes bigger utility bills!!!! We're actually debating whether we should move, since we think our current house is a little small 4000sq ft, and need more space. We know what we can afford, but we want to move to the best school district in the area (please keep in mind when looking!!) and we don't get much more space, for the additional money. We've put a lot of $$$ into this place, landscaping, new patio and walkways, finished basement, interior carpentry, etc and really don't want to start all that again. So, we're staying put until that perfect place comes available, and then we'll reevaluate. I wish you luck!!

 

[zulaya]

Tamie--

We refi'd a couple years ago and we talked with the people at eMortgageCenter. I believe they are out of Eden Paririe, but work the whole Metro. They also do new home loans but aren't really tied to a realtor so there's none of that buy, buy, buy pressure. They probably don't need to pressure anyone nowadays with rates as low as they are.

Anyhow, I'd contact them, explain your situation, ask them some questions about where they think the market is going, where rates are going, etc. They were very upfront with us.

Their website is http://www.emortgagecenter.com

 

[Minnesota!]

YES! And move to Oakdale Just kidding. DH and I are sitting on the same fence, actually. We just bought our townhouse last October, but it is already too small. Well, perfect for us, but if we were to get pregnant, we would have to move before the baby got here, because the other room is our computer room, and there is no where to move that computer to. The interest rates are so good, the houses are pretty decent here in the TC - for our price range, we could get close to our dream house, with a few additions here and there. But, I will tell you, Tamie, the western metro (and north) is growing so fast, which makes it more spendy the longer you wait. But, if it will stretch your wallet too much, I would wait a little I would go with your gut feeling..

 

[tkyes]

my head hurts now


One of the big things that is holding me back is that we have done so much to our house now and haven't really been in it long enough to enjoy it. Our new bathroom is almost done and it makes me sad to think of all the work we've put into it and that we wouldn't get to enjoy it.

Then the thought of doing it all over again on another house is so daunting it makes me want to cry!

I wish we could factor in the best school district into our search, but anything in that area would mean we would take a huge step down in housing because costs are so outrageous in those areas.

My gut feeling says to stay in our house because it makes me sad to leave it I know that's pathetic, I just have an attachment to it right now.

If only I could predict the future and see where we are in 3 years career wise and family wise, then I could make a decision! LOL!

Tamie

 

[mrsv98]

I listened to a financial program a few weeks ago and there was an *expert* talking about just this. He seemed to think that we are in a "mortgage bubble" the same way we were in a tech bubble in the 90's. He didn't seem to think that this would last. From what this guy was saying, I would think that you should take advantage of the incredibly low rates and get a house now. Just a couple of points on the interest can mean a lot of money later on. Also, if you haven't had children yet, you could try and take out a 15 yr mortgage and pay it off faster, or a 30 yr and make extra principle payments while you still have some money you can call your own!

We have re-fied twice in the 3 years we have lived here and are about to do so again. A 15 yr mortagage makes a HUGE difference in the amount of principle you pay every month, allowing you to build equity so much faster. When we had the 30 yr mortgage, less than 1/4 of the payment went to the principle, now just about 1/2 is principle. It sure is nice to see that balance go down so fast! By the time DD graduates from High School, the house will be paid off, then we can pay for college, a car, a wedding...... geesh! We have also taken out a home equity line of credit. We transferred the balance from our one credit card and the balance of my student loan. That cut the interest by more than half and the interest is deductable on income tax. That way, we are getting the most out of our house. With only one child it is a little easier but believe me, she still costs a fortune!!!

*disclaimer, I am not a financial advisor, nor do I play one on TV! *

 

[Lorix2]

We just went thru this too. Do we stay or buy another?

We're outgrowing our house with a 11 and 5 yr old. It's a small 3 bedroom, 1 bath house w/2 car detached garage that my DH built. It's on a dead end, big yard, long driveway and great school system. Also view of a lake. But still too small inside.

We now have $100K in equity. The problem for us is that we found another home we LOVED, it was a oversized split, finished basement, HUGE yard, much much more living space and same school system - BUT the downfall was electric heat, no garage or storage and minimal parking and the seller would not accept an offer lower than $229,000.00. Our present home offers us everything like privacy, the school sytem, great neighborhood where we've lived for 14 years, everybody knows us and vice versa. If we did buy that house, after paying the realtor their money and closing costs and even after putting in our profit from our house, it would have been a huge jump in our payment every month.

My DH has renovated every room in the house, built decks, put in skylights, tiled my floors, carpeted the others, landscaped,etc. and my kids call this place home.

SO! What we did and it was just completed, was put a 2nd floor on the house. The 3 bedrooms are now upstairs, my master is 15x24 and each kids room are 12x12, also a 2nd bathroom and my laundry is upstairs now too. Once the upstairs is completed, we're knocking down walls to expand living space downstairs. We had the floor trussed and built for this purpose.

My mortgage is still less than what it would cost me to move to a newer home and all the other extras are already here.

It sounds like your happy where you are but maybe just looking for a change? Maybe adding on to your living area, etc. may be what your looking for?

I know it's a tough decision, but much harder when you have children to consider. My kids were really bothered at the thought of moving and it also made me literally sick to my stomach signing my house away to someone else.

Sorry to ramble, but wanted you to know we were in a similiar situation and the only way you can make this decision is go with what your heart tells you...

 

[SplshMtn99]

OMG...we've been losing sleep over this very decision ourselves!

We are 38 yrs old. No kids. We've been in our 3 story 1300 sq ft condo for 10 yrs. Have less than 8 yrs left on mtg. And the rooms are finally just the way we want them.

Here's the reason to possibly move. My parents are getting older & live over 2 hrs away. My 50 yr old brother is in no position to help them when they get older with dr appts or a place to live (rather than a nursing home). Also couldn't live in their house to help them -- which would mean me & DH quitting jobs & moving there. Nope.

So, we've all discussed it. If we found a larger place, they wouldn't be opposed to living with us IF they got to a point in their life where they needed to. So.... do we buy a place with enough bedrooms & baths & private space JUST in case??? But what if they don't move in....then we've got this BIG house for just DH & me (no kids)...and a large mortgage payment for 30 YEARS (putting us close to 70 yrs old -- ughh --- rather than being mortgage free at 47 yrs old!)

DH's only requirement is that it be on a lake.....so that of course makes the price $$$$$$$$$$$$$$$$!!!! LOL

We've actually found a condo unit on a lake (with boat dock) for $260,000 which fits our criteria. We missed the first unit that came up for sale, but now another is for sale. We live in a condo now....and like not having to worry about maintance. If I'm busy looking after parents.... then I won't have to worry about looking after the maintance too....so it sounds good.

We can sell our condo....and leave with about $115,000 equity. It all sounds good. But the thought of moving / packing / painting / re-decorating....and going to a 30 yr mtg (we had a 15 yr mtg)....makes me sick!

Arrrgghghhh!!!!!!!!!! I feel your pain!!!!
I wish we could take our current condo, chop it up & spread it out to eliminate the stairs for my parents....and add onto it ....while moving it to a lake! THERE, EVERYONE'S HAPPY!!!!!!!!

 

[laceemouse]

My personal opinion... best school district is THE most important thing once you have kids! When we moved here 3 years ago we were sick to death of fixer-uppers! We wanted a new house something fierce! New house in our price range were further out from the city and NOT the best schools. We decided to get another fixer-upper and the highest school ratings we could possibly muster. Then, we did the whole update an ugly house thing for the 5th time. We already had 4 kids when we got here so we knew we needed gifted programs, etc...It is much harder before you have kids to make that decision, but keep it in mind or you will be moving again when your kids start school. Also, if you work, consider if the mortgage you get will mean you always HAVE to work. I love staying home with mine and don't miss the rat race one bit!! Good luck...Lacee

 

[Cindyluwho]

For the record, any Real Estate Agent who won't take the time to help you evaluate your situation is less than useless. Here's my theory: As a realtor it's my job to help you figure out if buying a new home is right for you at this time. It shouldn't matter to an agent if the answer is "no", because if they've done their job well you'll give them the business when it IS the right time to buy. Any agent who tries to hustle and hurry you into buying isn't looking out for your best interest and you should be looking for another realtor. I'd like to say that all the agents in my office look at the business this way, but it would be a lie BUT, there are good agents out there. Although, I'll admit, you sometimes have to look really hard..... talk to your accountant or financial advisor, he or she will give you a solid answer. And as another poster said, being in the neighborhood with a good school is THE most important thing if you're going to have kids. You'll end up saving 100's of dollars a month on private school tuition.

 

[tkyes]

We looked at a couple houses last night. None of them really thrilled us.

Now we've started to talk about the posibility of building, but we have to do some research on that too.

Yes, we could add on a bit to our current home, I don't know if we could add on enough to make us comfortable space wise. We can't add on another garage stall which is a big thing for DH.

Again - the best school district around would put us in an apartment or a dump of a house so we can't look in that area. The school district we are in now is where DH and I went to school and we didn't turn out too badly

Oh the joys of being an adult huh?


tamie

 

[zulaya]

I can tell you that we primarily moved into our two homes because of the schools. We knew we would have kids someday - which we now do - and we deliberately searched by school district to find what we liked.

I don't know where you are right now, nor if you are considering moving to another part of the cities, but check out some different school districts that have a good reputation and check to see what their housing is like.

I live within the Centennial School District (#12). It has a very good rep, good test scores, National Schools of Excellence, etc. Usually you can search on the Dept. of Education website and find test scores, etc for the different school districts in the Metro. You can at least narrow down areas to stay away from, if not find a list of areas to check out.

I think it's one of those things you just have to make the decision and go with it. It's almost like having kids. There's never a perfect time to have them, but you make it work when they get here. I am sure that if you stay in your current house, or move to a different one, everything will turn out fine.

 

[caitycaity]

We're actually debating whether we should move, since we think our current house is a little small 4000sq ft, and need more space.

WOW! 4000 sq ft is small?!? you must have a large family!

 

[Disney Doll]

You know, this is such a personal decision, and difficult to make.

First of all, despite everyone else on this thread's stated opinions about realtors, there are some good and honest ones out there who will guide you in the right direction. My husband is a realtor, and I have heard him tell people that they should not buy a house(efeectively losing his oppportunity to earn money)because they are not in the right financial position to do so. Talk to other people you know who may have used a realtor recently and get recommendations from them. Ask them how they liked their realtor, did they think their realtor was inherently honest and interested in assisting them to make good decisions. I know my DH has actually angered people by telling them they should not buy a house.

A couple of things to think about, and this is in no way any judgement on anyone here on the DIS, including you.

A house is a major investment, the most major investment the average person makes in their lifetime. But at a certain point, enough has to be enough. You need to sit down and decide what you ABSOLUTELY must have in your perfect house, and what you can live without. And I mean MUST have. I don't mean "would be nice to have". Let me give you my personal example. DH and I live in an approxiamately 1800 square foot house. It is a Cape Cod style, with 2 bedrooms and a full bath upstairs and a kitchen, livingroom,diningroom,full bath, and small(probaly 12'x12')den. We have a decent size yard(probably 125'widex75'deep). When DH and I were house hunting, certain things were a must:the towns we would live in, the price we were able to pay,the # of bedrooms(had to have the ability to have 3 bedrooms, which we could do if we converted the den as necessary),the style of house (I wouldn't live in a raised ranch, wouldn't be thrilled about a ranch but would do it if necessary,loved a Cape or colonial). Those things were the MUSTS.

Then there were the "would be nice" thing:a fireplace, a garage,a wraparound front porch. When we found our house, it had the area we wanted to be in, the 3 bedrom capability,the right price,a fireplace in the livingroom, a one car garage,it was a cape. It had all of our "musts" some of our "would be nices". It doesn't have a great yard...it's kind of hilly, it's on a busier street than I would have liked(we live on a secondary road that connects 2 main roads). It is convenient ot both our jobs, and it's a manageable size for us to take care of, without being a slave to the house.


When my DH got a promotion to Associate Manager of his office, we gave brief consideration to moving, but we decdied that for our purposes, our house was enough, and we weren't going to move because "he's in management now and neds to live in the right type of house"(something one of my acquaintances actually said to me). I guess my point in this long drawn out dissertation is that you need to separate the "musts" from the "would be nices". You need to look at the real estate market in your area. Right now in my area, while the mortagae rates are low, house price are exorbitantly high. It is a seller's market here, meaning that if you are selling your house, you'll get a great price for it, but you're also going to pay a large price for the house you're buying. Here houses sell quickly...usually within 1-3 weeks if they are priced properly.

A good realtor (and they do exist) will be able to help you determine your financial capability, the value of your current home, the prices of homes comparable to what you might like to purchase. and how much of a mortagage you would qualify for.

Remember, there is more to a house than the material aspects. Your house is oyur home, it's your sanctaury from the world, it's where you may raise your family someday if you are lucky enough to be able to have children. Be where you will be comfortable, both financially and emotionally. Size isn't always everything.