Would I be able to afford it?
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From: Delaware
Exactly about the buying of a house. I want my parents to buy me a house on my college campus becuase i know it can be rented out b/c students always need housing. And for me the already pay for my rent so why not just get a hosue. Now this is something i'd have to really look into with them, but its a good idea if you have the funds to do it.
Im really glad this thread has come up with good information
Im really glad this thread has come up with good information
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From: Ridgefield, CT
Originally Posted by bassholic
Exactly about the buying of a house. I want my parents to buy me a house on my college campus becuase i know it can be rented out b/c students always need housing. And for me the already pay for my rent so why not just get a hosue. Now this is something i'd have to really look into with them, but its a good idea if you have the funds to do it.
Im really glad this thread has come up with good information
Im really glad this thread has come up with good information
just kidding
Student housing provides some of the highest real estate returns there are to find right now. A company just went public that does that and military housing. Good thinking and good luck.
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From: Its not where, its who?
Originally Posted by KingOfJericho
Anyone in this entire thread who is paying rent has ABSOLUTELY NO RIGHT to give any kind of financial advice to someone thinking about buying a car.
Ok, Lets say that in most places to get a place on your own (your own apartment, house, etc.) you'll be paying between $600 and $1500 per month on rent. That comes out to between $7,200 and $18,000 per year that you're just flushing down the toilet. Let's say you have a FULLY loaded 6MT, you'll be paying mid $500's to maybe $600 per month plus roughly $150 to $300 per month on insurance (if you pay more than that, sell the f*cking car, I'm 23 and pay $166 a month with FULL coverage), that's $650 to $900 per month, max.
Now, thinking long-term, in 5 years of "saving" by not buying the car and paying rent, you will have BLOWN between $36,000 and $90,000 on rent. Say "bye bye!" to that money forever and the worst part is that you've got ABSOLUTELY NOTHING to show for that.
In purchasing the car you would have paid roughly $41,000 over the 5 years including interest, plus the $9,000 to $21,000 on insurance (no matter what you need to have a car, it cost me $15 more per month to drive the G over a Subaru Outback, insurance is a FIXED cost of living). That's a total of between $50,000 and $62,000 of total car expenditures, less gas.
NOW, for the past 2 years our cars have been listed as one of the top ten cars to hold its value (they have stated that the car will be worth approx. 56% of its original cost). That leaves you with a $21,560 ASSET (based on a fully loaded 6MT @ $38,500 sticker) in addition to whatever money you have saved. Now you can sell the car and put the money toward another investment (ie. house or apartment, the best investment of anyones life).
Finally, taking the exact average of both scenarios, you could either BLOW $63,000 and get nothing for it, or you could spend $56,000 less the value of the asset after payoff, you've spent $34,440 on the car... that's almost $30,000 you've saved yourself from spending on rent.
Now! Since insurance is a FIXED cost, I will now run the same scenario without the cost of insurance since you NEED to drive a car to get to ANY job (this doesn't count if you live in a city with mass transit, in which case this argument would never be happening).
CAR: you've spent $18,440 (if you choose to sell the car after 5 years) or $41,000 (if you choose to keep the car after 5 years) to drive the G over a Subaru Outback or whatever sh!tbox you currently drive.
RESULT: You've got a G!
RENTED APARTMENT:you've spent $36,000 to $90,000 on rent with nothing to show for it.
RESULT: You've got an Outback and FAR less cash!
YOU TELL ME WHAT THE BETTER INVESTMENT IS
Ok, Lets say that in most places to get a place on your own (your own apartment, house, etc.) you'll be paying between $600 and $1500 per month on rent. That comes out to between $7,200 and $18,000 per year that you're just flushing down the toilet. Let's say you have a FULLY loaded 6MT, you'll be paying mid $500's to maybe $600 per month plus roughly $150 to $300 per month on insurance (if you pay more than that, sell the f*cking car, I'm 23 and pay $166 a month with FULL coverage), that's $650 to $900 per month, max.
Now, thinking long-term, in 5 years of "saving" by not buying the car and paying rent, you will have BLOWN between $36,000 and $90,000 on rent. Say "bye bye!" to that money forever and the worst part is that you've got ABSOLUTELY NOTHING to show for that.
In purchasing the car you would have paid roughly $41,000 over the 5 years including interest, plus the $9,000 to $21,000 on insurance (no matter what you need to have a car, it cost me $15 more per month to drive the G over a Subaru Outback, insurance is a FIXED cost of living). That's a total of between $50,000 and $62,000 of total car expenditures, less gas.
NOW, for the past 2 years our cars have been listed as one of the top ten cars to hold its value (they have stated that the car will be worth approx. 56% of its original cost). That leaves you with a $21,560 ASSET (based on a fully loaded 6MT @ $38,500 sticker) in addition to whatever money you have saved. Now you can sell the car and put the money toward another investment (ie. house or apartment, the best investment of anyones life).
Finally, taking the exact average of both scenarios, you could either BLOW $63,000 and get nothing for it, or you could spend $56,000 less the value of the asset after payoff, you've spent $34,440 on the car... that's almost $30,000 you've saved yourself from spending on rent.
Now! Since insurance is a FIXED cost, I will now run the same scenario without the cost of insurance since you NEED to drive a car to get to ANY job (this doesn't count if you live in a city with mass transit, in which case this argument would never be happening).
CAR: you've spent $18,440 (if you choose to sell the car after 5 years) or $41,000 (if you choose to keep the car after 5 years) to drive the G over a Subaru Outback or whatever sh!tbox you currently drive.
RESULT: You've got a G!
RENTED APARTMENT:you've spent $36,000 to $90,000 on rent with nothing to show for it.
RESULT: You've got an Outback and FAR less cash!
YOU TELL ME WHAT THE BETTER INVESTMENT IS
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From: Ridgefield, CT
Originally Posted by Babiephat
Hey... I read it too... but can I get the "Cliff Notes" version of that?? LOL
After I typed it all up I scrolled up to proofread and gave up halfway through thinking "If I wrote it and I'm giving up halfway through, I'll be shocked if anyone reads it at all
" J-Cliff Notes are going to print as we speak.
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g and m3?
Originally Posted by iLLG35
Well i live in my parent house, im 19 and my second year of college. I work for my father basically full time and go to school full time, i dont make ALOT of money but enough to afford the new payments on my M3 with a chucnk of money down adnd help with insurance, yes i am greatfull and have it pretty well off but i am also working my *** off to pay the car off!
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Originally Posted by KingOfJericho
CAR: you've spent $18,440 (if you choose to sell the car after 5 years) or $41,000 (if you choose to keep the car after 5 years) to drive the G over a Subaru Outback or whatever sh!tbox you currently drive.
RESULT: You've got a G!
RENTED APARTMENT:you've spent $36,000 to $90,000 on rent with nothing to show for it.
RESULT: You've got an Outback and FAR less cash!
YOU TELL ME WHAT THE BETTER INVESTMENT IS
RESULT: You've got a G!
RENTED APARTMENT:you've spent $36,000 to $90,000 on rent with nothing to show for it.
RESULT: You've got an Outback and FAR less cash!
YOU TELL ME WHAT THE BETTER INVESTMENT IS
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Originally Posted by KingOfJericho
That doesn't really help me GET the house... that is where the problem is.. I was a finance major in college and work in finance currently. I've taken real estate courses out the wazoo... I KNOW I SHOULD BUY A HOUSE NOW, that's obvious, the problem is how the hell can I afford anything when the BARE MINIMUM I would be paying is in the $300,000's... FHA loans don't even come close to covering this type of purchase.
"Buy whatever you can afford!"
The burning question is: What do you buy when there IS nothing affordable?
I make great money (for someone my age) and I could buy a great place anywhere in the country... except where I live! My goal (which I think is reasonable) is to own a place by my 26th birthday, that gives me 2.5 years... I just don't want to save for 3 years and have prices double AGAIN!
"Buy whatever you can afford!"
The burning question is: What do you buy when there IS nothing affordable?
I make great money (for someone my age) and I could buy a great place anywhere in the country... except where I live! My goal (which I think is reasonable) is to own a place by my 26th birthday, that gives me 2.5 years... I just don't want to save for 3 years and have prices double AGAIN!
Here's a different angle to look at buying a house where the interest rates are low, I got this pamphlet from a professor before I graduated, it has 9 myths about home buying, just something interesting to read, I may not agree completely but it's definitely a different view and that's what my professor wanted me to do, think outside just a tad:
Myth# 6: I can't afford not to buy with these low interest rates.
It sounds counterintuitive, but low interest rates can actually make housing more expensive, not more affordable. How? Well, if low rates bring a lot of new buyers into the market, housing can turn into a seller's market. Now that there are more prospective buyers competing for the same houses, sellers can demand higher prices. So, interest rates may be low, but they haven't made housing more affordable if they have also pushed up sales prices.
Plus, if interest rates increase, the seller's market could quickly turn into a buyer's market. If you paid the peak prices commanded during the seller's market, you could find yourself having to sell your house for less than you paid for it if higher rates reduce the number of prospective buyers.
The lesson here is that while interest rates matter, you should not feel compelled to buy just because they are low. You may be overpaying for that house just to lock in a low rate.
Reality: Low interest rates may actually serve to make buying more expensive.
IMO - I don't think this applies to every situation, but makes sense.
It depends on the market. Some have supply and some just don't no matter what interest rates are. Philly and LA are examples of this. Having more money to spend on a home because of interest supplies some fuel to the value increases but it also has to do with the millions of new entrants into the market looking to get out of renting and realizing the value of home ownership. Don't wait to buy real estate that is proplerly evaluated...ever. Now is the time just like last year and the year before...
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From: Ridgefield, CT
Well since we've started talking about this stuff I have put the G up for sale and started looking into properties. With my present income, less the expense of the G, I can afford a $325,000 mortgage so I decided that the best thing for me to do would be to sell the G and buy the condo... I am going to drive my other car (BMW 318is, the reason I will never buy german again) for a few months then pick up a used ES300 or something (reliability is more important than hp right now).
Just giving you guys an update. Renting was never an option for me because it never needed to be but I do see how it is a necessity for others. I'll keep you guys informed as to my progress. Anyone looking for a 2004.5 coupe loaded black on black 6MT with 11K (Navi, Prem, Full Aero, Brembos)?
Just giving you guys an update. Renting was never an option for me because it never needed to be but I do see how it is a necessity for others. I'll keep you guys informed as to my progress. Anyone looking for a 2004.5 coupe loaded black on black 6MT with 11K (Navi, Prem, Full Aero, Brembos)?
Last edited by KingOfJericho; Jan 12, 2005 at 12:02 PM.
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From: Chicago
Originally Posted by SixFive
dam all from reading this thread?
lol...lol....because of this thread...my hunt for "G" is now on the back-burner.
I live in Chicago and pay $1200 a month for a 3 bedroom, 2 car garage, apartment. The "little misses" and I are now looking for a house.
This thread got me to do a lot of "reflecting" and "thinking" about my priorites.
Thanks guys!!!!
Looks like the "G" is going to have to wait another year.
