Rent or buy.

[Eugene]

In 92122, bubble denial is still strong and prices have barely moved since 2005. It’s too early to buy there. And it’s overpriced anyway. Come on, 2br for 450 grand?

If you don’t have to buy, don’t buy. If you have to buy, buy in a distressed area and make a point not to pay more than 2003 price. Try MLS 078069665.

[stansd]

Seems like your rent is pretty high as a comparison point. I quickly ran this through the model I have set up assuming a 420K purchase price. If you ignore the 80k down (I always do this because that money can earn interest in the bank), at a 5.75% 30 year fixed, your monthly payment including principal, interest, taxes, and insurance, and assuming $100 for HOA is a bit over $3,000. You get a tax deduction (assumed at 33%), but you’ll also have upkeep you won’t have on a rental (assumed at 300/mo.). Factoring this in, you are a bit under $2,600. Add to that the equity that you are paying down, and you are at about $2,100 a month.

From that perspective it’s a toss up. Most folks around here, though, will assume prices will continue to decline.

It comes down to what you think will happen to prices and rents in the upcoming years, and whether you are truly apples to apples on what you could rent for $2,000.

With the equity, your “all in cost” comparable to the $2,100 is a bit under $1,900, but I’d argue that is not a fair comparison.

[stansd]

Seems like your rent is pretty high as a comparison point. I quickly ran this through the model I have set up assuming a 420K purchase price. If you ignore the 80k down (I always do this because that money can earn interest in the bank), at a 5.75% 30 year fixed, your monthly payment including principal, interest, taxes, and insurance, and assuming $100 for HOA is a bit over $3,000. You get a tax deduction (assumed at 33%), but you’ll also have upkeep you won’t have on a rental (assumed at 300/mo.). Factoring this in, you are a bit under $2,600. Add to that the equity that you are paying down, and you are at about $2,100 a month.

From that perspective it’s a toss up. Most folks around here, though, will assume prices will continue to decline.

It comes down to what you think will happen to prices and rents in the upcoming years, and whether you are truly apples to apples on what you could rent for $2,000.

With the equity, your “all in cost” comparable to the $2,100 is a bit under $1,900, but I’d argue that is not a fair comparison.

[stansd]

Seems like your rent is pretty high as a comparison point. I quickly ran this through the model I have set up assuming a 420K purchase price. If you ignore the 80k down (I always do this because that money can earn interest in the bank), at a 5.75% 30 year fixed, your monthly payment including principal, interest, taxes, and insurance, and assuming $100 for HOA is a bit over $3,000. You get a tax deduction (assumed at 33%), but you’ll also have upkeep you won’t have on a rental (assumed at 300/mo.). Factoring this in, you are a bit under $2,600. Add to that the equity that you are paying down, and you are at about $2,100 a month.

From that perspective it’s a toss up. Most folks around here, though, will assume prices will continue to decline.

It comes down to what you think will happen to prices and rents in the upcoming years, and whether you are truly apples to apples on what you could rent for $2,000.

With the equity, your “all in cost” comparable to the $2,100 is a bit under $1,900, but I’d argue that is not a fair comparison.

[stansd]

Seems like your rent is pretty high as a comparison point. I quickly ran this through the model I have set up assuming a 420K purchase price. If you ignore the 80k down (I always do this because that money can earn interest in the bank), at a 5.75% 30 year fixed, your monthly payment including principal, interest, taxes, and insurance, and assuming $100 for HOA is a bit over $3,000. You get a tax deduction (assumed at 33%), but you’ll also have upkeep you won’t have on a rental (assumed at 300/mo.). Factoring this in, you are a bit under $2,600. Add to that the equity that you are paying down, and you are at about $2,100 a month.

From that perspective it’s a toss up. Most folks around here, though, will assume prices will continue to decline.

It comes down to what you think will happen to prices and rents in the upcoming years, and whether you are truly apples to apples on what you could rent for $2,000.

With the equity, your “all in cost” comparable to the $2,100 is a bit under $1,900, but I’d argue that is not a fair comparison.

[stansd]

Seems like your rent is pretty high as a comparison point. I quickly ran this through the model I have set up assuming a 420K purchase price. If you ignore the 80k down (I always do this because that money can earn interest in the bank), at a 5.75% 30 year fixed, your monthly payment including principal, interest, taxes, and insurance, and assuming $100 for HOA is a bit over $3,000. You get a tax deduction (assumed at 33%), but you’ll also have upkeep you won’t have on a rental (assumed at 300/mo.). Factoring this in, you are a bit under $2,600. Add to that the equity that you are paying down, and you are at about $2,100 a month.

From that perspective it’s a toss up. Most folks around here, though, will assume prices will continue to decline.

It comes down to what you think will happen to prices and rents in the upcoming years, and whether you are truly apples to apples on what you could rent for $2,000.

With the equity, your “all in cost” comparable to the $2,100 is a bit under $1,900, but I’d argue that is not a fair comparison.

[SD Realtor]

I know this area and the listing very well. My brother lives in UC. UC is a small area and the nicer homes in UC have held up fairly well. How long they will continue to do so is a good question. The lower end homes in UC (which I classify this as) have started to crack. I am always concerned when people by a 2/2 home. Even though the kids are out of state when they do come to visit it will be a tight squeeze. The other issue is if you ever do meet a significant other, you will outgrow the home quickly. Similarly 2 bedroom homes do not make for good rentals.

My advice, independent of the good post Stan made about the rent verses buy cost, would be that if you absolutely feel you have to buy now, try to stick to at least a 3/2 if you can. As always, if you can wait, I would try to wait for another few years. If you cannot then I understand, try to buy a home with a look at the big picture rather of what you will do with it if you have to move, rather then the immediate picture.

SD Realtor

[SD Realtor]

I know this area and the listing very well. My brother lives in UC. UC is a small area and the nicer homes in UC have held up fairly well. How long they will continue to do so is a good question. The lower end homes in UC (which I classify this as) have started to crack. I am always concerned when people by a 2/2 home. Even though the kids are out of state when they do come to visit it will be a tight squeeze. The other issue is if you ever do meet a significant other, you will outgrow the home quickly. Similarly 2 bedroom homes do not make for good rentals.

My advice, independent of the good post Stan made about the rent verses buy cost, would be that if you absolutely feel you have to buy now, try to stick to at least a 3/2 if you can. As always, if you can wait, I would try to wait for another few years. If you cannot then I understand, try to buy a home with a look at the big picture rather of what you will do with it if you have to move, rather then the immediate picture.

SD Realtor

[SD Realtor]

I know this area and the listing very well. My brother lives in UC. UC is a small area and the nicer homes in UC have held up fairly well. How long they will continue to do so is a good question. The lower end homes in UC (which I classify this as) have started to crack. I am always concerned when people by a 2/2 home. Even though the kids are out of state when they do come to visit it will be a tight squeeze. The other issue is if you ever do meet a significant other, you will outgrow the home quickly. Similarly 2 bedroom homes do not make for good rentals.

My advice, independent of the good post Stan made about the rent verses buy cost, would be that if you absolutely feel you have to buy now, try to stick to at least a 3/2 if you can. As always, if you can wait, I would try to wait for another few years. If you cannot then I understand, try to buy a home with a look at the big picture rather of what you will do with it if you have to move, rather then the immediate picture.

SD Realtor

[SD Realtor]

I know this area and the listing very well. My brother lives in UC. UC is a small area and the nicer homes in UC have held up fairly well. How long they will continue to do so is a good question. The lower end homes in UC (which I classify this as) have started to crack. I am always concerned when people by a 2/2 home. Even though the kids are out of state when they do come to visit it will be a tight squeeze. The other issue is if you ever do meet a significant other, you will outgrow the home quickly. Similarly 2 bedroom homes do not make for good rentals.

My advice, independent of the good post Stan made about the rent verses buy cost, would be that if you absolutely feel you have to buy now, try to stick to at least a 3/2 if you can. As always, if you can wait, I would try to wait for another few years. If you cannot then I understand, try to buy a home with a look at the big picture rather of what you will do with it if you have to move, rather then the immediate picture.

SD Realtor

[SD Realtor]

I know this area and the listing very well. My brother lives in UC. UC is a small area and the nicer homes in UC have held up fairly well. How long they will continue to do so is a good question. The lower end homes in UC (which I classify this as) have started to crack. I am always concerned when people by a 2/2 home. Even though the kids are out of state when they do come to visit it will be a tight squeeze. The other issue is if you ever do meet a significant other, you will outgrow the home quickly. Similarly 2 bedroom homes do not make for good rentals.

My advice, independent of the good post Stan made about the rent verses buy cost, would be that if you absolutely feel you have to buy now, try to stick to at least a 3/2 if you can. As always, if you can wait, I would try to wait for another few years. If you cannot then I understand, try to buy a home with a look at the big picture rather of what you will do with it if you have to move, rather then the immediate picture.

SD Realtor

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