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I just bought a house and it will cost half as much to own vs rent same house
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2012 Oct 12, 8:54am 112,339 views 412 comments
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bdrasin
2013 Mar 26, 9:18pm
Price: 875k
$ Financed: 700kLoan: 5/1 Interest Only ARM at 2.875 with .25 points (union bank)
What is the fully indexed rate? Like 8.874%?
PockyClipsNow
2013 Mar 27, 4:33am
Yes I have contemplated waiting until the 2 year mark for taxes.
BUT I am still going to get the remodeling done and put it on market in June to see what its worth. This will motivate me to gitter done (mostly all painting/tile I'm doing myself).
Then if I get a 1.2m offer I will take it, anything less I would think about and probably wait a year.
One issue is I closed escrow in late november. SO if i want to hit the 2 year mark for tax selling that means closing in december 2014 - have to basically list it in September..... 6 months after the spring rush when you normally get top dollar. This market is far from normal now though.
So in theory probably best to wait until spring 2015 to sell if prices keep rising and in regards to minimize taxes/maximize sales price. Thats pretty far off.
PockyClipsNow
2013 Mar 27, 4:59am
All good points.
Well if i dont get a fat offer then my choice is made for me.
Also probably a good idea to list your house every spring to 'see what its worth'.
The only reason i bought this damn thing was to make money/keep up with inflation in housing. I was actually happier in a 1 bedroom apt bubble sitting. Now my weekends are home depot and lowes...used to be at the beach and travelling or finding cool bars.
Well 20% price appreciation is pretty sweet. I will let you all know what my best offer is - plan to sell in June.
How'd you make out?
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I hope this is a real world math lesson for some of the 'should I buy now' crowd. Its a tough decision.
Price: 875k
$ Financed: 700k
Loan: 5/1 Interest Only ARM at 2.875 with .25 points (union bank)
Payment: 1677
Prop tax: 912
total: 2588
(im in 28% effective tax bracket so 2588 * .72 = 1863 'after tax write off payment')
Add fire ins of 129 per month and total pmt after tax write off = $1992
This is a custom built, recently remodeled huge estate home on acreage and zoned for horses - would rent for 3800 to 4200 based on craigslist comps.
If I change jobs I can make 1k per month easy in profit when renting it out. Its not a great rental though, but an awsome to live in property.
I sold four homes off in 05/06 and the plan was wait for 50% drop then buy back in. Well prices only came down to 70% of peak fraud prices - close enough with the low intrest rates (which I am betting are permanent, as in the rest of your life. If rates spike in 5 years I will simply pay off the loan, refi, or get a loan mod - no worries here.)