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We’re not buying a house

May 30, 2014

At least not any time soon!   We went to a few open houses, and have been seriously talking about it, but I just don’t think it is the right time.

Reasons to buy a house:

  • We live in the general area we will most likely live for a very long time
  • Irrational or “soft” reasons, such as:  “I don’t know, I just want to!”
  • Interest rates are very low.
  • We have the cash ready.  Basically.
  • I don’t intend to rent for life, I plan to stay in this area, so why wait?

Reasons not to buy a home:

  • Prices are really high.  Even if we can afford something suitable, that doesn’t mean we should.
  • I should be more firm in my long term plans  for my job.  I have no plans of leaving, but it is typical for people to leave after ~2 years.  I’m not saying I will, but I am just not sure what the future holds.  If I do end up looking for a new job, where we live would drive my geographic radius for job searching.
  • Houses are expensive and higher maintenance.
  • We are still pretty new to the area and are figuring out neighborhoods and what we want.
  • Moving is stressful.  I can’t imagine how stressful buying a home, THEN moving would be.
  • No, but seriously.  $750k? And we are still pressed for available houses?  What is this???

I’m trying to limit my time looking at houses on RedFin, because I’ve always been horrible at window shopping.  I shop with a purpose, not just to see!

Did you (or will you ) decide to buy a home based on life conditions (you were ready / “needed” a house”), market conditions, or both?  I think I should wait for both, but I hate being patient!

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12 Comments leave one →
  1. May 31, 2014 11:49 am

    I hadn’t really thought about buying a place because I most definitely did not want a house for the foreseeable future and I didn’t really think about buying a condo since where I grew up, condos didn’t exist (hello suburbs).

    Once I had enough cash saved though, I started looking and ended up buying a place within 6 months or so. I didn’t really have a strict plan to home ownership, nor a commitment to living in this place for that long other than figuring I would probably live in an apartment for at least 5 years. It seems to have worked out okay so far! I love not worrying about rent increases (though my property taxes did go up a lot this year). I probably would have spent more time thinking about it if it was a house though since that would have resulted in higher utility bills, more cleaning, more furniture, etc.

    • June 1, 2014 1:08 pm

      Yeah, the math for yours seems a little simpler!

      Condos aren’t something I’ve looked into much. They aren’t as available where we are looking, but they exist. Right now my thinking is that that if we are not buying because it seems like a bubble, a condo is also in a bubble, it is just a bit less exposure to it…

  2. May 31, 2014 9:25 pm

    Buying a house is overrated. As long as you’re saving money and investing in an asset that is earning more than 5% a year, forget real estate. I invest in REITs in my Roth so I’m diversified into real estate without it tying me down to any one location. I love renting. Maybe one day when I have kids I’ll buy but not a day sooner.

    • June 1, 2014 1:06 pm

      We are a little closer to having kids (but still a ways out), and we are basically tied to this area / ready to settle.

      I’ve never really been that excited about owning, but now is the first time it has started to make sense. Unfortunately, the market disagrees with me.

  3. June 1, 2014 1:08 am

    My reasons for:

    We live in the general area we will most likely live for a very long time
    Irrational or “soft” reasons, such as: “I don’t know, I just want to!”
    I don’t intend to rent for life, I plan to stay in this area, so why wait?
    We know this city and we know the areas we would want to live
    I personally doubt prices are going to fall (perhaps stabilise a little, but the trend over the past 20 years has only been in one direction and it’s UP)

    Reasons not to buy a home:

    Prices are really high. And we can’t currently afford them.

    I think prices in SF may generally be a little higher than Auckland (although I am not sure what you guys define as SF – having been there I would say we are looking in what would be the equivalent of South San Francisco, this area used to have its own city council and was technically a different ‘city’, and is a similar distance from CBD). You’d be lucky to find a very basic starter in the late 400s/500s out this way and it goes all the way to million plus. In the central burbs a starter would be more like 700 these days.

    • June 1, 2014 1:05 pm

      Yeah, SF proper is crazy, I think I’ve seen $750k or so for a 2 bdrm condo… at the low end of the spectrum. And up from there. In the areas we are looking, I think it would be $700k minimum, but we could get a proper house for that. I guess we’ve been holding the price constant (at $750k or so) and seeing what we could get in various areas. It’s discouraging.

      • June 2, 2014 4:21 pm

        Forgot to add that interest rates here are on the rise (and of course here we do not have 30 year rates, maximum 5 years at a time, but that’s just how it is). So that’s another negative.

  4. June 1, 2014 7:33 am

    Being in Canada, with the housing market correction on the cusp of happening within the next 5 years, we’re waiting until it bottoms out. Plus I need more money.

  5. June 1, 2014 9:06 am

    When I moved to the Bay Area, I watched the house prices start at “insanely high” and just go up from there. I had resigned myself to not ever owning a home in this area. Also, I was still on work visas, and so my employment position was not stable.
    Eventually I got my green card, which allows me to work for any employer, and the market crashed. House prices were suddenly within the realm of *possible* – and interest rates were a good deal! Plus I was getting *really* tired of the housemate loop – having to advertise and interview people every 6-10 months was getting OLD. And I’d had a few bad experiences with housemates by then.

    I spent a long time looking, but I ended up in a townhouse that I really like, and with a mortgage payment that I can afford.

    • June 1, 2014 1:03 pm

      Yeah, I’m thinking we’ll just have to wait it out until there is another dip. It may take years, but it seems like there are always times when it drops a bit, and we’ll be ready. I wish we were more ready in 2009/2010, but our lives just weren’t in the right place.

      Congratulations on finding something that works for you!

  6. June 3, 2014 11:52 am

    Well, the rent/buy ratio is way out of whack in our town (buying is a lot cheaper) and buying is one of the easiest ways to avoid living near students. And houses are super cheap around here. And we were tired of moving. And we had 50K saved up and the mortgage payments were less than what we were paying in rent in grad city. We picked out and bought a house in 3 days.

    If we ever move to SF we’ll be renting for a long time before buying.

    • June 5, 2014 1:16 pm

      That’s awesome. Despite this post I’m (rather suddenly) interested in owning. Logically, it seems like a poor move…

      And 3 days! That is my dream. I told my husband to just buy me a house, but I don’t think that will work.

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