patrick.net

Kevin says

Yes, and it’s something that we’re considering, but it’s hard to justify doing that now with the market insanity firmly entrenched. If it comes down to no other choice, I’ll probably tap the 401k, although at most that’s only about $40k (the actual limit is $50k or half of your total, and I’ve only got about $80k in mine — and yes, I’m maxing out my contributions and I have a 50% match). My wife doesn’t work and has no 401k.
Unfortunately I’m already over $200k this year because of some good luck with my company stock plan, so it’s unlikely that I’ll qualify for the tax credit. If they keep the limit at $170k I might be under next year.

In this case I would say: wait till you have at least $110k in your 401k. This would allow you using extra $60k for down payment, closing etc. But make sure you take a loan from your 401k, try to not withdraw from it. If your job is secure you can repay $50k loan quite easily in 2 years. If it's not - no reason to buy.

Tude,
Have you been up here to physically look at properties? The real estate world via "internets" is a place of dreams with very little reality attached, at least in my experience. Maybe like Cali FOR nia. I've looked around quite a bit there too.
Seattle area listings are usually never as they seem. I'm on my 3rd year looking for a decent place at a value based price without that "fatal flaw". Yes, I'll admit I'm picky. I'm not into old meth labs, houses in slide zones, mold infested fixers, properties right next to gas stations or neighbors who have a bad case of OCD. If it's a decent house in decent condition for a decent price its gone in days, even in this so called slow market. If you want it you'd better run to look at anything you think you'll like and looks legit in terms of marketing.
If that property on Vashon you refer to in your post is really as it appears on Redfin you better bust a move 'cause it will likely be STI very soon.
Vashon properties, especially waterfront tend to be very expensive. 425k doesn't add up. I guess it's remotely possible prices are correcting very steeply over there.
My wild guess is that's one of those Vashon places that doesn't have vehicle access to the house. The Redfin listing states 'no parking' if you look closely. Yes, you might have to walk all your stuff back and forth down a pedestrian trail or boardwalk. Charming, I'm sure. Great for a weekend/summer place, but otherwise in November when its cold and pouring down rain even as a retiree you'll be enjoying yourself slogging along that walk with your armload of soggy groceries luxuriating in those 'panoramic Sound views'....
Maybe California really IS THAT BAD but for someone who has lived in the Puget Sound area since the mid 90's, it just seems foolish to participate in this ongoing mania. The housing hasn't changed but for the worse and the heady delusional days when that common refrain "I'm going to be a multi-millionaire' HAS. You could even buy an "affordable" house during THOSE times. You at least had the option of buying something out of the city and commute in for your work. Has anyone noticed the prices lately of those places out in the backwaters that used to just generate Seattlelites' snickers and sneers?
I'm beginning to come to the conclusion that the west coast property market is permanently hosed.
And that makes me very sad.

Well at least in California, the estimate is to double the population by 2020 or something insane (I believe that was a quote about 5 years old?).

Those back water places might be unrealistically expensive now, but if your options in a few years are to commute 1 hour or 4 hours into work, those back water places might start to look pretty good. The sheer number of people moving into California should help revive the market, even if it requires 10 years, it won't be permanent.

pkennedy:
Some of those backwaters I referred to sometimes ARE the 4 hour commutes today especially if you are on the "wrong" side of the water. If the price of gasoline ever goes beyond what it was in the summer of '08 it will make even less sense.
Will you be able to afford not only the time but the fuel for such a horrendous commute? I doubt it will look much better as a deal than today, maybe worse....
To clarify, Vashon Island is not IMO a backwater, it's a nice place within a short ferry ride to downtown Seattle.

The statement that California is going to double in population by 2020 seems like an argument related to the old "buy now or be priced out forever" . Anyway, I thought California was losing population not working on doubling it. In this economy? Guess that's good for all those in the Golden State. IMO at some point more is not better it just causes scarcity and crowding. We have that here already. I guess it can get much worse.
If all the Californians do decide to move to Washington State to find "cheap" housing, I guess they'll get it. Seems at least a good number have the perception that housing should cost more than most working people could ever hope to be able to pay! Then there is that pesky problem called local markets that kicks in based on those local job wages. Once you move here and find a job here its all relative anyway.
But like I said before, I'm afeared the whole west coast property market is hosed for some of us.

lyoungblood says

10caipirinhas says

I told my wife that “if she wants to buy now it means divorce”. Plain and simple, the look on her face was priceless.
Told her that “I can get laid for $100 whenever I want, and if I work at it, for free, so that I was not going to spend $100K+ down and $3-4K a month”…….”just to keep her nesting hormones happy” (my exact words), given the state of our economy and house prices (here in Canada we are at 7.3 times income and you guys were at 5.4 or something similar when your bubble burst, and ours has not burst yet). We are currently saving $2,700 a month as renters……and have been for years. Said if she wants to ruin herself financially she is perfectly entitled to do so on her own, and she can if she wants to, from a financial perspective, as she also has her own money, as do I. Been married since 2001, and I think we’ll be married for the rest of our lives.

There is no reason to ruin oneself financially whatsoever just because your wife’s brain isn’t working properly. If buying a house is cheaper than getting a divorce, in your situation, you may have to reevaluate your scenario, but in my case it is not by a long shot.

You must be a real hit with the ladies… lol… If I told my wife those things I probably would have to pay for sex.

You probably already do in any number of ways. We all "pay" for sex in various ways, not just cash. Of course, these days some believe and seek to leglislate "budgets"/money control as emotional abuse in relationships. One of the biggest reasons for divorce... financial issues. Who do you think would/will take the heat after the ARM reset of the couple in the "Suzanne researched this" century21 ad? I doubt it will be suzanne or the wife.

Maybe that one place on Vashon on the water has "fatal flaws" but there are several properties on Vashon on acreage for less than 500k I have been watching for a while that don't seem to be selling
http://www.redfin.com/WA/Vashon/11330-SW-220th-St-98070/home/520827
is right next to the equestrian park, and has been on the market for a year.
How about this? An acre, has parking, near the water, a little more but trouble selling?
http://www.redfin.com/WA/Vashon/8950-SW-146th-Pl-98070/home/522094
Personally, with your $$ and income I would be looking at the upper end of you budget but making lowball offers until one sticks.
What zipcode are you looking in anyway?

pkennedy says

Why have you moved 4 times in such a short period? Was it to better position yourself for work? Better rent? Job changes? And the big question: Are these reasons likely to exist after you make a 20 yr commitment???

AZ -> CA for work, moved twice in CA because we had two kids in 2 years, and moved to WA about a month ago to escape the insanity of the bay area.

michaelsch says

In this case I would say: wait till you have at least $110k in your 401k.

That would require another 18 months (unless the market does really well), which would be pretty painful (Maximum contribution = $16.5k + 8k for the match). I could do something crazy to pad the beginning of the 2011 calendar year early, but that's still going to take at least 12-13 months.

AltonS says

You probably already do in any number of ways. We all “pay” for sex in various ways, not just cash. Of course, these days some believe and seek to leglislate “budgets”/money control as emotional abuse in relationships. One of the biggest reasons for divorce… financial issues. Who do you think would/will take the heat after the ARM reset of the couple in the “Suzanne researched this” century21 ad? I doubt it will be suzanne or the wife.

Some of you people have very bizarre relationships with your spouses. That's not healthy.

Vashon is nice, but it's also an hour+ commute from my office (in Southern Kirkland), and I like getting home before my kids go to bed.

Still saw well over 100 homes in the Kirkland area that are 4+ bedrooms for less than 500k. All look like really nice homes too. I can only conclude that you are another person complaining that they cannot find a home in a specific 5 block area for what they want to pay, therefore it's impossible to find a home in their special area.

I hear it about the "Bay Area" too. Nothing less than 800k people say, then you find out they too good to live anywhere but Piedmont... Whatever.

Kevin says

For instance, I’d really like to pay off my car. We owe about $18k on it, and are paying around 8% interest. Paying it off would give us an extra $500 a month, but we’d also be taking a $18k hit on our down payment money and it would take three years to make up the difference.

I'm sure you realize that "option" will cost over $2,300 in non-deductable interest. If you are pretty sure you will not buy for at least a year, you are paying $2,300 to have an extra $12,000 in down payment money.

Kevin says

"Some of you people have very bizarre relationships with your spouses. That’s not healthy"

Uuuhhhhh wrong........not being able to take a stand when you are correct is unhealthy in a relationship. Especially when the stakes are this high. Financial ruin is not to be messed with for the sake of a cuddle.

Sex is the one tool that women hold over us, take it away from them and they are completely disarmed. She had to fight the battle with logic, facts and reason at that point, and guess what.

Basic psychology 101.........Alton has it right. If you believe that being a plaid plant wearing sensitive metrosexual is the path to harmony, you deserve to get steam rollered. So go ahead, buy now, despite all the evidence to the contrary, and I guarantee that you'll probably be moving again in the future.........back into another rental and with no money in the bank.

I've got 2 friends getting divorced this year......both who bought last year........one of them told me he was wrong not to take my advice, all he wanted to do was "make his wife happy". Well now he is out divorce costs, divorce settlement costs and $100K of cash he put down. The other one won't talk about it. I've got better things to do than make this crap up. I'm not trying to be rude Kevin, it's the internet, you can't see my face or read my body language.

Good luck.

Kevin:

Give it another year or so. If you've only lived in seattle for a couple of months, you may end up changing your mind.... Many people won't like this next bit, but I grew up in Vancouver and finally left when the weather got out of control. 10 months of rain, every day. Not drizzle, but wiper blades on full every time I would get in the car. 10 months. That was from el nino, and a bad year, but 200 days a year is the norm for rain in Vancouver, which is similar to Seattle in weather patterns.

I came to California and the weather is just amazing. As most people know :) I went half way backup to Portland and it was the same thing, all over again. Lots of rain and cloudy days. Funny story, I almost had to pull over on the highway once because I couldn't get the rain off windshield fast enough. Then I thought about it for a few seconds and realized I had never done that before, and this couldn't be the worst rain I had ever experienced. The problem was I had moved my wiper setting from min intermittent to max setting. I forgot I could even turn them on all the time, because I hadn't used them in years. In fact I didnt know how to turn them on in that car, I had to look around because I had never used them.

It might not seem bad right now, it might be a novelty for you. But make sure it's what you really really want. Grey clouds for 200 days of the year can get to you. Blue is a calming color, and when the entire sky happens to be blue, having sunny days can really effect your life and emotions beyond "it's sunny!".

As you've moved to escape things, believing you are in greener pastures, I would recommend waiting the year.

Kevin says

kentm says

The things to consider: are you really loosing anything by renting,

Absolutely:
1. Nice rentals are still pretty pricey (not that much cheaper than buying, to be honest), and cheap rentals are, well, cheap.

The kids wont care, nor remember whether it was cheap or not. The parents will?

2. I want a place for my kids to grow up in. We’ve lived in 4 places in 4 years. That’s not exactly good for their well-being.

Again, this is the adults thinking.

3. It makes it much more difficult to plan out anything else in life.
For instance, I’d really like to pay off my car. We owe about $18k on it, and are paying around 8% interest. Paying it off would give us an extra $500 a month, but we’d also be taking a $18k hit on our down payment money and it would take three years to make up the difference.

This is bad. You should really pay it off, or refi at a credit union. Where else will you get a 8% return?

We also want to start contributing to our children’s college savings, but it’s hard to budget for that when you’re trying to save as much as possible towards the house.

Why? If saving for a house is interfering with saving for your child's college fund (or retirement), then you are not ready to buy a house, IMO.

Even simple things like buying a new TV or sofa are tough decisions. If we spend $1500 on that sectional are we going to be another month away from our objectives?

Don't buy those things, then.

Lastly, there’s a very good chance that I’m going to get hit with AMT next year, so the mortgage tax deduction does start to look very attractive.

Really? Why is MI ded. so attractive because of AMT? Do the math, and see how much of a difference AMT vs regular tax is. Getting hit with AMT is just not a sufficient reason to buy a house. MI is deductible in AMT world, but property taxes are not.

StillLooking says

You mean for $2500-3000 per month you can’t find a great place to rent where you want?

Oh, I certainly can find a place for $3000, but that’s about what it would cost to buy. If I’m going to waste $3000 a month that I’ll never see again, I might as well buy a place and at least get the tax deduction.

There is however a case where it still makes sense. Suppose the choices are
(1) You pay 3000 rent
(2)You pay 2000 (net, after tax deduction) as house payment, but house prices (in your range) drops 50K in a year.

Renting for one year, and buying after that saves you 38K, and saves you more over the life of the mortgage, because of the lower mortgage amount.

About me. I rent. 3 bedroom condo, for last 4 years. Best school district.3 kids. 2,5,8 yrs. All my friends family own. Immense pressure to buy, but now, now after 4 years, all think I was smarter.

My priorities are different. I think I need a (1) reasonable place to live (2) kids get educated now (3) kids get to go to college (4) save something for retirement. (5)enjoy life a bit (6) save what is left. I realized long ago that buying a house would conflict with those things, and I was forced to chose what I wanted in life. I chose not to buy a house, and still have a full life.

My family has more fun and freedom than all my house-locked friends. We will buy a house when we can have the same life in spite of owning a house. We are much closer to that now, ironically because we decided to postpone buying a house.

You can have a life without owning a house. But don't rent and squeeze you life dry with scrounging to buy a house. In the long run, you will have a better chance of buying a home.

You have a certain expectation of life as it will be, when you own a house. Say you bought a house now. What if owing the house prevents you from having that life? Is it worth buying?

I'm just tossing a thought up here, but if a person fits into the general population where they live more or less pay check to pay check, regardless of income plus or minus a few % for savings or going into debt, a house is going to cost the same no matter when you buy. It will cost you roughly 30 years of your pay check. It will be the maximum you can afford more or less.

The reasoning for this thought is that people will take advantage of whatever options are available at the time and use them to purchase their house. If interest rates are low, then they'll pay more for the house and max out their mortgage ability. If they are high, they will pay less but still max out how much they pay for the mortgage. If there is an 8K credit, they will add that on top of their mortgage and they'll end up with a 30 year mortgage +- 5 years or so? If they save up, they will buy more or cut down a few years on their mortgage.

For most people, it probably doesn't matter when they buy in terms of cost, because the clock will start counting down WHEN they buy. It will take the 30 years or so to pay off in any economy. Of course this doesn't include the massive "bubble" where people got into positions they simply couldn't deal with, but anyone who could afford their house in 2000's will keep paying off their expensive house for the next 30 years. Anyone buying now with lower prices, will be doing the same thing.

Really, it seems to only matter if you don't fit in with the general population. Eg you can live below your means and actually do it. Then pricing, rates, down payments and other items actually effect the decision making process.

Those people are most likely the people on this board. While we has a dislike for NAR in general, their constant matra of it's the right time to buy is probably true for most people, because the sooner you start the 30 year clock, the sooner you'll be done with it.

pkennedy says

their constant matra of it’s the right time to buy is probably true for most people, because the sooner you start the 30 year clock, the sooner you’ll be done with it.

One significant problem with your view, is that Americans RARELY live in the same house for 30 years. They get to year 7 on average. Perhaps have to sell an underwater house due to jobs, divorces, medical issues, etc. The view that everyone remains frozen in place for 30 years from the moment they buy a house is simply not the America we have right now, and switching to that model would be significant change. It impedes the flow of labor to where the jobs and skills are needed at that time.

Vicente:

To some degree yes. But not "everyone" was flipping homes. There were a good number, yes. But there are a huge number of home owners out there, and a huge number who don't move around much. It would be nice to have some information on the average time a person spends in a home, removing the flipped and speculative buyer from those statistics.

Job loss can be bad, but a lot of people simply won't move when their job moves, they'll just accept their new commute. Like renters, people don't like moving. LL's count on that when raising rents. I'm assuming here that many people will just eat the new commute on their new job.

While we do have a 10% unemployment figure, the flipside is 90% are employed. My comment was more about the average person. The average person has a job, as the 90% figure states. Average people who move into a home to nest aren't looking to filp and will try and avoid it. If they do flip every 7+ years, then they're probably moving into larger homes and starting over, but with a large home when they finish the whole 30ish year pay off.

Cranker makes a good case.

Kevin:
“Some of you people have very bizarre relationships with your spouses. That’s not healthy”

Not married, not in a relationship. 32 years old, somewhat happily single for the moment. Seen and heard too many horror stories not to take these issues very seriously. As an aside I found it rather amusing when I was looking seriously 2 years ago that most of the female RE agents/dev. salesgals thought I was odd for wanting a bigger house. "Thats a lot of space for a single guy!" I'm sure some thought I was possibly an investor type but many seemed surprised that I might be thinking of the future (family, mother retiring and needing to live with me) and that locally most of the best deals were for the 1800+ sq ft homes.

To some degree yes. But not “everyone” was flipping homes. There were a good number, yes. But there are a huge number of home owners out there, and a huge number who don’t move around much.

The numbers say otherwise. You will see the pendulum swing increasinlgy more toward mobility in the coming years.

Kevin,

Definitely pay off the 8% car loan immediately, before you do ANYTHING else.

You surprised me a bit today. I see you analyze (and debunk) complex political questions with great ease and elegance, but this car thing is an absolute no-brainer.

I understand that it may be sort of a "dry powder" argument about having the down payment ready, but still ...

Best of luck.

@justme,
I have been in position to pay off my car loan that is at 4% .... but chose to hold my cash due to the very real possibility (in my mind) that things could get really bad and eating would be more important than no car debt, plus having a fat account looks good at DP time should a REwhore feel I deserve to place a bid on a home. It is a tuff choice to make, as the money sitting only gets .75%, so I'm losing a little each month, but I still have the bulk of the cash .... dang it, it is a tuff one. The bright spot is, I pay it off in Jan either way. yaaa me.

Bap33, I see what you mean. But if one had 100k in the bank you'd still have 82k afterwards. One could live on that for a while, I'd say.

Justme, you are absolutly correct about that .... I aint THAT guy!! lol

I try to keep 6 months wages on hand for job-loss and emergency, and that is not easy. I can't imagine $100K in the bank.

pkennedy says

I came to California and the weather is just amazing. As most people know I went half way backup to Portland and it was the same thing, all over again. Lots of rain and cloudy days.

Do you have as many forest fires as we have... do you have droughts as we have ? Having water which is essential to people and irrigation of crops has evolved as a commodity in California.

Having 'great' weather doesn't give you any kind of edge over other regions highly productive workforce.

Keep a lot of sunblock on hand or suffer the aging spots and skin cancer.

cranker says

The kids wont care, nor remember whether it was cheap or not. The parents will?

A 'cheap rental' usually means an apartment or a run-down SFH. I didn't bust my ass in college and at work to live in a crappy little apartment. Life's too short to not enjoy it.

cranker says

Again, this is the adults thinking.

There have been plenty of studies on the effects of unstable home location on childhood development. Kids do better in school, are more likely to attend university, and are less likely to commit crime when they live in the same location for most of their childhood.

cranker says

This is bad. You should really pay it off, or refi at a credit union. Where else will you get a 8% return?

8% is pretty typical for an auto loan, unless you're buying new straight from the manufacturer. Refinancing it might save $80 a month or so, but that sure as hell isn't going to make any real difference in my financial situation. Even at 0%, 18k is still running $390 a month, and there's no bank that's going to refinance a car at 0%.

cranker says

Why? If saving for a house is interfering with saving for your child’s college fund (or retirement), then you are not ready to buy a house, IMO.

My kids can always get student loans if we haven't saved enough by the time they go to school and they don't get scholarships. I borrowed about half of my financing for college and it was paid off after a year of work. No big deal. So, yeah, saving for my kids college education is a lower priority than housing.

cranker says

Don’t buy those things, then.

I could just not buy anything -- maybe go live in a cardboard box. But I'd have lots of cash! I could roll in it, fold it up into paper airplanes, or maybe swim in it, scrooge mcduck style. The possibilities are endless.

There's really no point in working if you're not going to enjoy the fruit of your labor

cranker says

Really? Why is MI ded. so attractive because of AMT? Do the math, and see how much of a difference AMT vs regular tax is. Getting hit with AMT is just not a sufficient reason to buy a house. MI is deductible in AMT world, but property taxes are not.

Oh, I've done the math. Once the gap between the "loss" of rent and the "loss" of interest falls below $1100 or so, the interest is cheaper. AMT is going to cost me at least $20k next year, so yes, being able to reduce that by $8k or so would be great.

cranker says

There is however a case where it still makes sense. Suppose the choices are
(1) You pay 3000 rent
(2)You pay 2000 (net, after tax deduction) as house payment, but house prices (in your range) drops 50K in a year.

Renting for one year, and buying after that saves you 38K, and saves you more over the life of the mortgage, because of the lower mortgage amount.

Yes, if I was only planning on staying in a place for 1 year that makes complete sense. However, since I'm not a seer and I really don't give a shit about short term losses, I don't care. Once I've got a house payment that I'm comfortable with and that will never change, I can focus on real investments.

You seem to be under the impression that buying a house would make me not have money for other things, which is very strange considering that I already stated that I make in excess of $150k a year and we're talking about a monthly housing cost of justme says

Definitely pay off the 8% car loan immediately, before you do ANYTHING else.

You surprised me a bit today. I see you analyze (and debunk) complex political questions with great ease and elegance, but this car thing is an absolute no-brainer.

I understand that it may be sort of a “dry powder” argument about having the down payment ready, but still …

It's not really a 'no-brainer'. Paying off the car would definitely reduce my available funds for down payment, repairs, etc., and 8% isn't enough to lose sleep over. Plus, the car is one of the only things I've ever bought on credit in my life, so it's helping improve my credit score. It turns out that if you don't use credit, you don't really have much of it :)

Kevin, the only other thing that I would add is that, unless you are intimately aware of the area, rent awhile until you are sure where you want to live. The area you belive is best now might not be what you want in six months. IMHO, of course.

I and my sister grew up in rental accomodation from birth to adulthood. We moved 4 times, to 4 different ciities, and 2 different countries during that period, yet neither of us have committed any crimes and are considered normal, well developed, and responsible adults.

Imagine that.......another REIC home ownership myth debunked.

10caipirinhas says

I and my sister grew up in rental accomodation from birth to adulthood. We moved 4 times, to 4 different ciities, and 2 different countries during that period, yet neither of us have committed any crimes and are considered normal, well developed, and responsible adults.
Imagine that…….another REIC home ownership myth debunked.

Not sure one success story disproves the theory. There's a sample size issue there...

And real estate only goes up you know......

I was an "army brat" and there are a probably a million of us combined (army, navy, AF) on the continent.

...okay, I lied. He didn't actually look at me, but he was wrong...

10caipirinhas says

I and my sister grew up in rental accomodation from birth to adulthood. We moved 4 times, to 4 different ciities, and 2 different countries during that period, yet neither of us have committed any crimes and are considered normal, well developed, and responsible adults.
Imagine that…….another REIC home ownership myth debunked.

I now live in a small town and it's full of people who've lived in the same town - hell, their parents are in the same house - since they were born. I moved so much, I've never had that. I'm sure it didn't affect me none.

Other than robbing a bank, being busted x4 for peddling drugs disguised as kiddie porn, and shivving a dude in prison 'cause he looked at me wrong, I've grown into a normal, well-developed, responsible adult...

living on a military base, or near one while active, is very similar (other than weather) no matter what soil you are on. In my humble opinion.

Bap33 says

living on a military base, or near one while active, is very similar (other than weather) no matter what soil you are on. In my humble opinion.

This is actually quite intentional. To keep a semblance of "home", military-provided homes are all designed to be very similar. You can find a property in Germany, one in Japan, and another in Kansas and they'll all look very similar. It's the same reason why they have standard programs like 4-H.

Military children as a population have some of the highest rates of mental health problems in the world. While you can certainly attribute a lot of that to having a parent deployed, even in times of peace this has been shown to be true.

Plenty of people who move a lot turn out just fine -- but why take that risk for a tiny potential financial gain?

I just know that it sucked to move so much. It was always in the middle of the night or before the rent was due... I didn't like being the new kid in school every year.

Home ownership isn't for everyone, but it worked for me. Of course, I bought a tiny place and put a chunk down on it. I still have some equity, but I certainly kick myself for not selling at the peak. I'd have $200k in my pocket, but would've had trouble renting with farm animals.

kevin

you might want to look more seriously into those "studies". What I've seen in follow up says that what matters is not renting versus owning but moving that's the "problem". Kids of parents who have moved into a new rental in the past year tend to do more poorly than kids who's parents moved into a new owned home.

But, 1) after 3 years of staying in the same place the differences dissappear.
and 2) generally speaking moving into a rental indicates financial or other hardship that would be weighing on the family, moving into a home is correlated with a family doing well/better financially.
Thus the researchers concluded that all the studies about renting/owning and kids "doing well", when combined together on a meta level, actually showed nothing more than the obvious which is that families under financial duress are stressful.

Which is a big fat duh.

You're providing a loving and caring and stable environment for your kids, dont' hide in studies of an aggragate of families to self-rationalize buying. Do it when it makes sense for you. Don't blame it on your kids.

Kevin says

There have been plenty of studies on the effects of unstable home location on childhood development. Kids do better in school, are more likely to attend university, and are less likely to commit crime when they live in the same location for most of their childhood.

I think that's what he's saying. Moving is the issue.

tatupu70,

And what exactly is forcing him to move 4 times in 4 years? The choice is not between moving again every year until they finally find a home to buy. It's about moving once now, or moving once later.

Statistical generalities do not apply to individuals particularly well. That's not even what they're intended to inform. The purpose of the studies is to determine if our government's strident policies subsidizing homeownership have had any positive effect or not. It's not actually supposed to be applied to individuals. You move when you need to move, you create a loving environment for your own family my limiting and mitigating and coping with and overcoming stressors.

This is not a lead paint kind of issue, where causation is clear, this is a correlation kind of thing.

cara--

Wow. I can't speak for Kevin and his reasons for moving. I just thought you misunderstood his reasoning and wanted to clarify what he posted.

I disagree with you about how to apply the study--but it's a discussion best left for another topic...

kevin:
Refinancing it might save $80 a month or so, but that sure as hell isn’t going to make any real difference in my financial situation...

However, since I’m not a seer and I really don’t give a shit about short term losses, I don’t care...

I could just not buy anything — maybe go live in a cardboard box. But I’d have lots of cash! I could roll in it, fold it up into paper airplanes, or maybe swim in it, scrooge mcduck style. The possibilities are endless

There’s really no point in working if you’re not going to enjoy the fruit of your labor

You seem to be under the impression that buying a house would make me not have money for other things, which is very strange considering that I already stated that I make in excess of $150k a year

Huh? Why the vituperation? Is this the same person who claimed ....

Paying it off would give us an extra $500 a month, but we’d also be taking a $18k hit on our down payment money and it would take three years to make up the difference.

We also want to start contributing to our children’s college savings, but it’s hard to budget for that when you’re trying to save as much as possible towards the house.

Even simple things like buying a new TV or sofa are tough decisions. If we spend $1500 on that sectional are we going to be another month away from our objectives?

You are buying a house. May you have a good life in your house. Good luck to you.

I'm a dog on the internet.

"vituperation" ???? did this come up on your deasktop's "word of the day"? lol. Just kiddin.

Well, thanks to the mini bubble in the market it looks like we actually managed to scrape together quite a bit more than we had planned. As a result, we're now under contract and set to close in mid-december.

The end result is that my monthly payment is going to be about $2300 (sans taxes), which is what I was paying in rent for a place less than half the size (and much lower quality overall) than what we're buying in the bay area. We went for new construction, since everything built from 1940-1990 or so seemed really low quality (poor insulation, asbestos, etc.), and the only houses we could find built before WWII were either too small or needed too much work.

Now if I can just get over writing a check for $120k in a few weeks, I think we'll be OK.