I'm 22 in Everett, Wa. Making $13/hr currently. I have $11k saved and my supportive parents want me to save it to buy a house which so far I have not spent any of it. Well where I'm currently renting the landlord wants me out by March. I'm so far looking into Condos but I am basically being blown off by realtors and lenders alike by my pathetic income, not working full time fore a year yet, and my measly budget (one pre-approval of $95k) My parents will gift me the rest for a 20% down payment but they still want to hold off on co-signing which makes no sense given how fast I need to move out. Apartment payments seem about the same as owning a home. Is a condo really that great of an investment? I'm starting to feel like taking an apartment and look next year to be taken more seriously, maybe try using my $11k for something else to try and make use of it somehow. What do you think?
I'd always advise renting at your age, particularly since you don't make oodles of cash and your economy's improving. If you get a great job offer halfway around the country, not having a house where you are would be a godsend.
Source: 29 and still renting, but I'm in Canada where the answer's a bit more cut and dried..
you really have to ask yourself if you're ready to want to be a homeowner. Google up some homeowners stuff and ask yourself if youre ready for it.
Since you're in a situation that needs to be fixed fast, I would suggest renting a place for 6 months and using those 6 months to calmly looking into being a homeowner.
don't make hasty decisions
you are a native english speaker, a highly prized skill in the east. i spent a few years teaching english to chinese kingergarten aka fucking babbys and saved 13k usd while living it up and cultivating substance abuse habits. google daves esl cafe thats THE spot for esl jobs.
I live in Sydney, Australia, so there's no fucking way I'll be able to afford a house until my parents both die or the housing bubble finally bursts.
But if the latter happens I'll probably be even more fucked.
Okay, I'm 42 and live across the puget sound from you, purchasing a house in my 20's is the best investment decision I made. I have a big chunk of equity and a place I can rent out for positive cash flow.
If your folks will get you to 20% so you don't have to deal with mortgage insurance and you are in a real estate market that is trending up, you will have a very nice asset in 5 years.
Also consider renting out a room. The mortgage will be much more manageable.
I also got blown off at your age by realtors bankers and car dealers. And when not blown off I felt treated like I might be taken advantage of because of my youth and perceived naivety.
Try to find people to work with that are friends or friends of friends. If you have a friend that works in a bank, have him or her introduce you to the mortgage dept. And see about getting a promissory note from your folks to cover part of the down payment with before you walk into the bank. It could really help you out when you are getting a credit check for a pre-approval.
Realtors are paid on commission, they won't won't be scrambling to you for a 100k home or condo no matter whats your age. Go to the MLS(multiple listing service) online and do your own searching.
I'm also in Everett. You could probably buy a piece of land for 20k and build a cheap house with shipping containers or other cheap materials for 80k. Look into building your own home.
IIRC isn't having someone give you the money for a down payment and then not having them appear on the mortgage illegal? Not that it would be easy to catch but regardless it's a bad idea. If you can't afford the down payment you generally have no business taking the loan.
It's not illegal, but you have to be able to document the sources of the funds. They need to be identified as a gift or a loan. If a loan, they will count against your debt to income ratio. If a gift, the giver may be subject to gift tax.
It's always a good idea, if you know you're going to buy a home, to season the funds for 6-12 months. Lenders typically don't go back more than 12 months on bank accounts, so if the money sits there 13 months, they won't ask where it came from.
it's likely the worst investment you will do in your lifetime
If you're the typical american, with no savings and no self control that waste their money on impulse purchases, then you should buy a house because it's a way of forcing you to save money by putting it into your home equity.
Is now really a good time to buy a house or a condo? With the Chinese markets tumbling, isn't there a decent chance that the US real estate market will also falter? I've heard that a lot of the wealthy Chinese have invested in US real estate, and they may look to cash out some of their US real estate.
if you can find an affordable condo in the area, go for it. you'll be able to build equity on it and take further loans against it in the future; something not possible with a rented apartment.
on a second note... $11k is actually a pretty good down payment for an average condo around here (reppin the 425 as well). one of my friends paid 65k total about 3 years ago for a nice 3-bedroom in one of the gated communities on w. casino, so you should be able to find at something at least.
Buying a condo when you make $13/hr doesn't strike me as a very prudent decision. You're still very young. Find a cheap place to rent for a few years while you continue to save and focus on increasing your income.
Hey bro check out earthbag home and yurts! Both are cool and I built both saved me toons of money no mortgage and now I own a home! My yurt was cheap cuz it was built from willow with grows everywhere and my earthbag home only cost me under 20,000 to build and it's as big as a 100,000 usd home and u cant even tell it's made from bags of dirt ;)
They can be troublesome to rent out, HOA are always an issue. Many of them are poorly run, bickering neighbors etc.
Condos are the equivalent of an entry level job, its something you want to do but not linger for too long. Lots of people get stuck in them for long/lifetime and act like idiots about it.
I paid 72k for mine and it just sold for $140 same area as OP
Chiming in that it's too early to buy. Your life can very well change drastically in several ways. Rent for now, save more, and get a more solid bead on where you want to be and what you want to be doing. Houses are a money pit that lock you into a geographic location and a certain way of life for forever unless you're lucky. Also condos are a waste. Rent an apartment and save. Best of luck anon