Thinking about buying\building. can i afford it?

[rbusch]

Hello all, been a lurker but first time poster. My question is...what would be the pro and cons of buying or building? Can I afford it? I have been married for 2 years. I'm 29 and my wife is 27. We bring in an combined income of $60000per year. Our first year of marriage we payed her student loans and car loan off. I have 55000 in savings, 25000 in stock market and 50000 in my retirement, my wife is a teacher and I am not sure on her pension at this time. We currently have no kids. We have no debt and we drive 2 lower mileage vehicles that should last multiple more years. Our monthly expense is around 1800. 575 of that being rent. I'm looking to buy/build a 1600 to 1900 sq Ft home. In my area I expect this to run around the 190000 mark. I personally would like to rent longer save more for a larger down payment. I know many are against renting rather than paying to own. Your suggestions, comments and thoughts are welcomed. Thanks

[MonkeyMama]

Rent and save for a down payment. At that pace it doesn't sound like it would take very long?

Buying is sometimes (not always) a better long term solution. It varies a lot regionally. But renting sounds like it is affording you a high savings rate. So of course I would rent while I saved 20% down payment. It's a short term situation, but also seems to be a savings booster for you.

[Retired To Win]

A Foreclosure Might Save You Loads

If one goes by the "replacement value" of homes that insurance companies build into their home policies, buying an existing house always seems to be a better deal. Not to mention that the financing is a lot simpler (hah!) for a home purchase than for a home construction. AND you won't have to wait months and months -- and months -- for a house to be build. (And think of the dealing-with-contractor headaches!)

I would suggest you look into available foreclosures in your area. The last 3 properties I have purchased (2 main homes, 1 vacation place) have all been in foreclosure and the appraisals have all come in WAY above what I've ended up paying for them.

Good luck...