Question about buying a house

**disneysteve** · 10-17-2010, 03:19 PM

1. A house is not an investment. An investment is something you buy for the purpose of making a profit. That shouldn't be your intent when buying your primary residence.

2. You should buy a house when you are ready in all respects including financially ready and life situation ready. If you don't have a 20% down payment and a 6-month emergency fund, you aren't ready. If you don't have a stable job or are in an uncertain relationship, you aren't ready. Don't let a good deal sway you from proper planning. There will always be good deals out there.

**greenskeeper** · 10-17-2010, 03:50 PM

Originally posted by skives View Post

Is a house still a good investment. I mean long term if I'm going to stay in it for at least 15 years? Also if a house comes up that I like and is a really good deal and I am still 2 years away from when I planned on being ready to buy a house should I rethink my plan or stick to it and pass on the house?

If you are in for 15 years, yes the house is a good investment

**maat55** · 10-17-2010, 05:08 PM

As Steve said, a house is not an investment. After you pay interest, taxes, upkeep and insurance it is at best an interest less savings account. IMO, housing will still fall further, renting and saving is a good option for the next year or two.

**disneysteve** · 10-17-2010, 05:27 PM

Just to further address your question, yes, I think if you buy a house today, it is almost certainly going to be worth more in 15 years. That still doesn't make it an investment because, as maat55 points out, there are many expenses associated with ownership that offset the price appreciation. Still, if you are ready to buy a house, now is certainly a good time to do so. If, however, you are not ready yet, don't let market conditions dictate your decision.

**cypher1** · 10-18-2010, 05:42 AM

I say stick to your original plan and save for 2 more years. A lot of us don't take into consideration of how much time we typically invest for upkeep into a house. As I was bagging leaves/mowing lawn, cleaning gutters over the weekend, I kept thinking how nice some of my friends have it for renting. If something breaks, they go to their landlord for repairs, not including home owners with HOA. Lots of people think only think about maintaining lawns for summer, and shoveling driveway for winter. As a first time buyer, in the last 18 months I've replaced my water softener unit, garbage disposal (most disgusting optional appliance IMO), a bathroom faucet, finished my garage for paint and shelving, and restored my deck (stabilize, pressure wash, sand,and stain). Actually those 2 last were optional projects, than a need, but the point was how much time I put into all these tasks. If you're young, single, energetic, and motivated (like myself

to work on your house with your time, then go for it. Otherwise keep saving and make a list of fees and maintenance needed for a your future place.

**littleroc02us** · 10-18-2010, 06:05 AM

A house is a place to live. Yes it can be an investment if you play your cards right. But you have to remember that it can be a risky investment if you were to buy one and then later on it is selling for less than you bought it for. My parents bought a small house on a 100 acre farm in 1971 for $28,000. In 1997 they sold it for over 1 million. Then they took part of that money in 1987 and built a brand new house for 154k and sold it in 2003 for 600k. They have built much of their money from real estate.
If I could do it all over again, I would have rented for a long time and saved up a 40% down payment. Having a large mortgage payment really does drain your resources. The more you can put down and the lesser the term the better. (15 year) According to a lot of experts the housing market won't recover for at least 5 years, so you should be able to get a deal within that time. Good luck.

**Ima saver** · 10-18-2010, 06:29 AM

I bought my first house in 1966 for $13,000. I sold it in 1974 for $40,000. Then I built myself a new house. Since I was 32, I have owned my house outright, with no payments. Each time I sell, I move up in house. As long as I have no payments, I feel that owning a house is a good investment. We built our current house about 15 years ago and it is worth about $500,000. It too is free and clear of any mortgage. (It does help that my husband is a builder)(And knows how to fix everything)

Question about buying a house