Should we buy a house .... In view of the current volatile situation....
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Posted on: 05-08-11 23:30:00
We have finalized a house.... And are now looking at closing the deal and arranging funds.... In 90 days.....
However, we are now worried whether we should go ahead and buy the house or walk away from it..... To defer the buying decision.....
Please advise..... We have been through one too many recessions....
We believe that anyways we will be paying rent.... And other expenses.... So why not mortgage???? But the mortgage is really the max we can pay at the current levels..... If there is any change.....like increase in interest rates..... Plus, after putting all savings in down payment..... We would be living on a month on month basis.....meaning, begin savings from scratch.....
We simply love the house..... Which has everything we would want in a home.... Location....size....etc....
Will this situation blow over or is this a signal..... I remember the rumblings for months.... Before the Lehman brothers collapse..... And now the S&P ratings.....
If this is your first house and you can afford it..sure go ahead. The affordable house where you will live, is recession-proof. There may be ups and downs but since you live there it is irrelevant. As an investment..I would wait rather refrain. Good luck!
In todays market you should buy a house only if u can afford it..
When i mean affort it u should have sufficient balance in ur accounts to pay mortage for 1.5 years.
Interest rates are unlikely to go up in the current economic scenario, housing prices are likely to go down too considering the low affordability..
I personally think the next recession is round the corner.. i would think twice to buy in the current economic scenerio..
That said if u are renting , buying a house cannot be a wrong choice especially if ur payments including untilities will be equal or slightly more than ur rent.
Hi,
Our elders always used to advise, it is
When buying house, or precious metals, they are never expensive.
You shall never go wrong, in the long run you shall end up winner
You always have to do your math, before taking any major decisions, however in the hindsight you also tend to get this questions , you are asking.
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mor
Whenever you experience joy, peace, security, equanimity or purity, it is only because you are aligned with ALMIGHTY.
In today's point of time, we can afford this house.... However, if we are on the edge of a recession, then what can one say about job security etc...... Plus, if the value of the property devalues.... We can keep aside a 4-5 month mortgage buffer..... But that's about it....
The mortgage+utilities+taxes will be almost double the rent we are paying right now....
The cost of owning a house (Mortgage, property tax, maintenance, utilities) are over 50% of your household income, it starts to become riskier. As it grows, it gets much riskier.
Quote:
Originally posted by geetakhanna
We have finalized a house.... And are now looking at closing the deal and arranging funds.... In 90 days.....
However, we are now worried whether we should go ahead and buy the house or walk away from it..... To defer the buying decision.....
Please advise..... We have been through one too many recessions....
We believe that anyways we will be paying rent.... And other expenses.... So why not mortgage???? But the mortgage is really the max we can pay at the current levels..... If there is any change.....like increase in interest rates..... Plus, after putting all savings in down payment..... We would be living on a month on month basis.....meaning, begin savings from scratch.....
We simply love the house..... Which has everything we would want in a home.... Location....size....etc....
Will this situation blow over or is this a signal..... I remember the rumblings for months.... Before the Lehman brothers collapse..... And now the S&P ratings.....
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The cowards never started,
The weak died on the way,
Only the strong arrived.
http://www.youtube.com/watch?v=_yK1i9cLAMM
Quote:
Originally posted by geetakhanna
In today's point of time, we can afford this house.... However, if we are on the edge of a recession, then what can one say about job security etc...... Plus, if the value of the property devalues.... We can keep aside a 4-5 month mortgage buffer..... But that's about it....
The mortgage+utilities+taxes will be almost double the rent we are paying right now....
Don't forget repairs and renovations. Also don't forget that your mobility in case you want to change jobs in terms of cities is pretty much gone. The transaction costs of buying and selling in the short term are high.
Doubling your rent is a huge shock in the short term.
