"100% of people who do not save money do not have any!"--Dave Ramsey

[Isaac Zachary]

Originally Posted by Xist

I wondered in what situations a tiny house would make sense and he just said not to buy mobile homes, they don't appreciate because there is limited demand for them.

My moile home has increased 70 times in value since I bought it. It originally cost me $500. Now it's worth almost $35,000 according to my property taxes. And I didn't put anywhere near $35,000 of improvements into it. There are also some similar to this one that have sold for over $150,000. Maybe I should put it on the market for that amount and see what happens. A $150,000 down payment on a $300,000 condo would make it considerably cheaper.

[redpoint5]

Originally Posted by Xist

Dave says to not buy a house until you can afford 20% down and to pay it off in 15 years.

He's wrong about that.

You missed the best opportunity to buy in recent times. VA loans are super good, and it makes total sense to buy with 0-5% down and accept the PMI when interest rates are 2.5% on a 30 year loan.

You don't want to pay off a tax deductible interest rate like that, you want to carry it as long as possible as a hedge against inflation.

So long as the government insists on screwing responsible savers, you want low interest fixed rate debt; the more the better.

My 4 bed, 2.5 bath, 2100 sq/ft house purchased in 2010 for $217k on a 30 year loan is $1,200/mo including taxes and insurance. I've never paid the $1,200 because roommates took care of it.

Zillow says it's now worth $500,000+ and I'm still only paying $1,200/mo. Low interest fixed-rate debt is your friend.

If housing prices fall (which is unlikely), it would be a good opportunity to buy and simply refi the loan once you have 20% equity and interest rates drop (to eliminate the PMI payments). You can always refi the loan, but you can never refi the purchase price.

Originally Posted by Isaac Zachary

Don't pay more for buying (monthly) than you would on rent. If $2,000 per month is too much for renting, it's too much for buying. It doesn't matter if it's a 15 year loan or a 30 year loan.

Second, don't buy a house if you will probably move in a couple of years.

If you're a single guy, you want to buy the biggest house the lenders will approve you for and rent out the other rooms, making your house free. You want the 30 year loan because the cash you save every month with a lower payment can go into the stock market, which outperforms the low interest you're paying on the loan.

[freebeard]

If you're a single guy, you want to buy the biggest house the lenders will approve you for and rent out the other rooms, making your house free.

Been there, done that, lost the shirt. I had some interesting housemates.

[JSH]

Originally Posted by Piotrsko

I churned houses to the same effect. Worst house in the better neighborhood.

Nice explanation of Roths and Iras. Thanks

Did they fix the ferry issues in Scotland?

Not yet. We sat in on a session of the Scottish Parliament and the first topic was ferries and the recent grounding.

This was a public transit trip for us but no ferries. We flew into London but spent most of our time in Edinburgh. Public transit is much cheaper and faster than a car in those areas. We were a bit worried about getting out of London today (May 6th) due to the coronation but besides a 15 minute ground stop at Heathrow for the flyby no issues.

[Xist]

How many years ago did you buy your mole home?

Thirty-five thousand isn't enough to buy an empty lot within Show Low city limits. The cheapest one I found is $41,500, but only 6,098 square feet, although there is a quarter acre for $44,000.

Here is a mobile home on a quarter acre 15 minutes away: $139,000 2 bedrooms, 2
baths, and 924 square fee It is the cheapest mobile home I can find without an HOA and not in a 55+ community.

I have looked at rundown mobile homes before and thought it was perfect for demolishing. I could buy the property for the cost of a lot and it comes with connections!

This one is as old as me, but I think that it looks too nice to tear down.

For how long would I need to rent it out for that to change?!

The problem is that I need one renter who will trash it over like 10 years.

If they trashed it in one year I would call the cops and sue them!

Let's say they do just enough damage in 10 years that it isn't worth fixing. You keep the deposit, they take you to small claims court, and you hand the bailiff an entire photo album of 100 parts of the house before and after. Then you say "Your honor, it was a total loss, here are pictures of its demolition.

I guess that you shouldn't pull permits for a larger site-built house before you go to court!

[Isaac Zachary]

Originally Posted by redpoint5

If you're a single guy, you want to buy the biggest house the lenders will approve you for and rent out the other rooms, making your house free. You want the 30 year loan because the cash you save every month with a lower payment can go into the stock market, which outperforms the low interest you're paying on the loan.

If you're single and would or wouldn't rent a $2,000 per month 3 bedroom appartment with a couple of roommates, then the same should apply to a $2,000 mortgage on a 3 bedroom condo in my opinion.

But yes, there may be more of an incentive to get a bigger house and more help to pay for it.

In my case I have children with special needs that I don't see would work with having someone else in my house who isn't family.

Originally Posted by Xist

How many years ago did you buy your mole home?

In 2011

[redpoint5]

Originally Posted by Isaac Zachary

If you're single and would or wouldn't rent a $2,000 per month 3 bedroom appartment with a couple of roommates, then the same should apply to a $2,000 mortgage on a 3 bedroom condo in my opinion.

But yes, there may be more of an incentive to get a bigger house and more help to pay for it.

In my case I have children with special needs that I don't see would work with having someone else in my house who isn't family.

The buy vs rent conundrum depends on many factors, but the general rule of thumb is that buying is the better financial choice if one plans to live there at least 5 years. Less than 5 years, and renting usually pencils out better (due to closing costs and realtor fees when buying).

Subletting rooms tends to be more appropriate for single people. That said, I maintained 2 roommates for the 3 years following my marriage, but no kids at that time. I'm still open to renting rooms now that I have 2 kids as we don't need all 5 bedrooms and 3 bathrooms. We hardly ever go downstairs as it is. Renting the 3 rooms out down there would easily cover the entire cost of this (in my opinion) extravagant house.

Some rental agreements prohibit subletting.

[Xist]

Originally Posted by Isaac Zachary

In 2011

There has been 34.19% inflation since then. https://www.in2013dollars.com/us/inf.../2011?amount=1

How the heck did you buy anything larger than a doghouse for $500?!

[Isaac Zachary]

Originally Posted by redpoint5

The buy vs rent conundrum depends on many factors, but the general rule of thumb is that buying is the better financial choice if one plans to live there at least 5 years. Less than 5 years, and renting usually pencils out better (due to closing costs and realtor fees when buying).

Subletting rooms tends to be more appropriate for single people. That said, I maintained 2 roommates for the 3 years following my marriage, but no kids at that time. I'm still open to renting rooms now that I have 2 kids as we don't need all 5 bedrooms and 3 bathrooms. We hardly ever go downstairs as it is. Renting the 3 rooms out down there would easily cover the entire cost of this (in my opinion) extravagant house.

Some rental agreements prohibit subletting.

It seems to me that if I can earn 7% in the stock market I would be better off doing that, but that's my circumstances.

If I buy a 2 bedroom condo that also binds me to no subletting for the first 8 years for $300,000, I'd be spending well over $1,000 more per month than lot rent here for a 2 bedroom trailer on a rented lot. In 30 years the price of the condo will be about $500,000 if it goes up 2% per year on average. But at current interest rates I will have spent over $700,000 in those 30 years meaning I'd have only saved some of that money, not earned anything, unless the kids move out after 8 years and the wife and I can rent the other room to someone to put towards the mortgage.

But if I put that more than $1,000 per month towards the stock market and earn 7% per year on average then after 30 years I'd have over $1 million but will have spent the same $700,000 on both rent and investment. However, here I can't sublet the other room. There's also the question if lot rent won't go up past $1,000 per month in those 30 years.

[Isaac Zachary]

Originally Posted by Xist

There has been 34.19% inflation since then. https://www.in2013dollars.com/us/inf.../2011?amount=1

How the heck did you buy anything larger than a doghouse for $500?!

Terrible condition, strict landlord, knowledge of construction, lots of buddies who help me grab scraps from remodels so I can renovate for free off of someone else's garbage.