Which home to buy "Need some expert advise"

[Scab]

My advice, based on 44 years of marriage, is to go with the one that makes your wife happy.Jim

Bingo. Get the acreage.

 

[Fencer]

Forget what I said earlier.

Get the larger place.

+ the covenants of the trac home prob don't allow for the toy hauler (and neither will the yard with the back property being 31 feet from the rear of the home.)

Even if you fence it in, most covenents make you stop at either the back corner of the house 80%, but some let you go to the midpoint of the house. Even fewer to the front corner of the home.

 

[Waaane]

My advice, based on 44 years of marriage, is to go with the one that makes your wife happy.Jim

This is excellent advice

I am no expert but I am doing some similar thinking with houses in the Auburn CA area. I kinda see it like this...

The number one question to ask yourself is which house do you want to live in. It seems that the answer to that is the 2.5 acre place. If that is true you have to figure out what the real difference in cost is.

The price of the KB is $380K. The asking price for the 2.5 acre is $150K higher. You say you are going to rip out and upgrade the kitchen counters and some other stuff in the KB house? You will be spending some serious money here. This may be wrong but for the sake of arguement lets call it $50K. Granite is not cheap. So now you have a $100K difference.

You are in a buyers market. Have you seriously explored the true market value of the 2.5 acre place? The "asking" and "selling" prices for homes in my part of cali are rarely the same these days. Is it being sold by a bulder or a private party through a listing agent? How many days has it been on the market? Are there similar places for sale near by? If so are they selling or sitting? My guess is that they are mostly sitting.

If that is correct find an agent down there and write them an offer for something like 15% less then the asking price. All they can do is say no, but they will probably send you a counter offer. If you land the house at 90% of asking or around $480K you are really only paying something like an extra $50K for the house you want.

Assuming you will be using a conforming conventional loan at around 6% every extra $50K you borrow will cost you about $300 a month. If you can make a deal go for it.

The $7K you have in the KB home will probably have to be written off. As long as you are under contract to the KB home you would have to make the offer on the 2.5 acre home contingent on the resale of the KB home. What are the chances of you selling that house quickly without incurring costs thart are greater then $7K? Probably not real good.

Good luck.

 

[donaldb]

Jesuspalamena!!!!!!!!!!!! :blink:

My whole house would fit in that garage.........Welp, at least mine is paid for. It's nice not having a mortgage. Our 3 bed 2 bath modest brick home on 7 acres is still our little piece of heaven.

If'n I was you I'd go with the bigger house given your circumstances, it would seem to fit your needs the best and in the end that is what is most important. Once the kids are gone you can always downsize if thats in your future play book.

I think maybe you might want to consider adding a tree or something, every guy needs one to pee on.

 

[motorgod]

Location Location Location. Dont buy the best house on the block and dont ask for advise from people where the only thing you have in common is a motorcycle.

 

[Murph]

I tend to agree most with rangerK9 and motorgod.

How much risk do you want to incur in your life? Go with an affordable home payment .... nothing more than 35-40% of your total household income is what most financial gurus advise. Betting that you will continue to increase your earnings is just that .... a bet. You never know what is going to happen so I think it's best to go with what you can afford now...not what you will better be able to afford in X number of years.

It sounds like you are unsettled about the KB house. For that reason alone, I would not go thru with that deal and would try to recover as much of the $7k as possible.

As for the other house, remember that there are many great houses out there. It is a buyer's market right now. Keep in mind that, the more you sell yourself on one house, the more likely you are to pay more than you have to for that house. Remain objective and don't cost yourself more money because you're sentimental about one property.

 

[Bounce]

It's a doable mortgage but might be tight for a year or two.

that's the same thing all those people said who are now defaulting. buy with an eye for losing your job next week. if you lose your job and have to look for another, how long can you last before losing the house? 3 years? 1 year? 1 payment?

 

[gypsy]

KB does not have a good reputation among my many fellow tradesmen. But, of course, one can find critics of anything --- except Guinness.

I don't like Guinness...and I have tried it in Dublin and still didn't like it!! <_<

gypsy

 

[shokdimn]

Wait a minute... You are looking at a $4-500k house, plus you have a 40' toy hauler (which, I assume, includes a mongosso truck and requisite toys) and you really don't care about losing $7k? And this is on a fireman's salary? Do I have this right?

You're on the trail. :detective2:
But, did you miss?

My pay will just keep increasing with promotions, step raises etc so either one would be better with years.

I shoulda been a fireman. :dribble:

Me too...Me too. :yes: OTOH, I new someone that was getting a job as a fireman somewhere in CA when he got out of the "service" . That counts for something, right?

I’ve heard it said, “there’s no replacement for displacement”. :bike:

 

[rangerk9]

I tend to agree most with rangerK9 and motorgod.
How much risk do you want to incur in your life? Go with an affordable home payment .... nothing more than 35-40% of your total household income is what most financial gurus advise. Betting that you will continue to increase your earnings is just that .... a bet. You never know what is going to happen so I think it's best to go with what you can afford now...not what you will better be able to afford in X number of years.

It sounds like you are unsettled about the KB house. For that reason alone, I would not go thru with that deal and would try to recover as much of the $7k as possible.

As for the other house, remember that there are many great houses out there. It is a buyer's market right now. Keep in mind that, the more you sell yourself on one house, the more likely you are to pay more than you have to for that house. Remain objective and don't cost yourself more money because you're sentimental about one property.

Also, here is something to consider and a good tool for retirement planning:

Retirement Calculator

I hope this helps someone.

Rex

RLTW!!

 

[okmac]

It is hard to put oneself in another persons shoes, however you asked so here goes.

I would consider it a no brainer, Go for the 2.5 acres. I have 4 acres with a small home and would never trade it for a larger home with no land.

1. You will have room to build a new garage when the time arrives.

2. You will have room to park the trailer.

3. Most important, you will have room for the kids to play , with the other one they would have to go someplace else . Keep them where you can not only see them but enjoy playing with them as well.

Regards

Mac

 

[evil_henchman]

Also, here is something to consider and a good tool for retirement planning:
Retirement Calculator

California firefighters don't need no stinking retirement calculators! They get CALPERS at 3% at 50.

Base pay at age 50 x .03 x years of service.

Example: Get hired at age 20 and retire at age 50 with 30 years = 90% of your base pay AND you get annual COLA raises!

Hell yes I'm jealous! I only get 2% at age 55! :lol: But then I don't put my *** on the line every day either. Enjoy that retirement buddy you earned it!

 

[JoshHefnerX]

As long as you KNOW you can make the mortgage, go for the acreage. The best neighbors are the ones not living right on top of you....

Josh

 

[radman]

I'd give rad the truck, then you won't have that big expense to worry about.
New Guy

Wow, that guy really makes sense here, doncha think?

 

[mdisher]

Hands down if you can swing Home #2 go for it. You'll never, ever be sorry you had too much land. By the looks of it, not a lot of grass to cut And lots of room for dirtbikes and good clean red-neck fun.

Just don't go into debt up to your eyeballs to get it.

-MD

 

[Bounce]

But, did you miss?

My pay will just keep increasing with promotions, step raises etc so either one would be better with years.

step raises, promotions, and even COLAs aren't a certainty. there's an assumption of them because they've come regularly in the past but city/state/fed are all in fiscal binds these days so any administrator may choose to freeze increases on a whim.

 

[hardluk1]

I would listen to Murph. Sounds like you try to live a high life and a 500,000 dollar house should top that off real fine. Look around and buy an older home that might even need some TLC. The cost of that big house could place you in a bad way real quick. AND don't live above your ablity to produce income. To many people have lost there a** to stupid purchases. Not try'n to be a smart *** but besure your wife can deal with everyday life if you die on or off the job. Would you want that same big 500,000 dollar house then. Live well with in your means.. Then you can still play .. I'm 52 semi-retired and don't owe anything to anybody and I did it not living above my means or keeping up with anybody named jones. Just remember it's still just a house.

 

[lacofdfireman]

Just finished talking to the bank and this is what we were told.

Home #1.

Cost $380k and we will be putting down $100k so will be financing $280k. Payment is about $1700 at an intererst rate of 5.75% which is the current rate for a Residential 30 year conventional loan. Plus around $400 for taxes and insurance per month so Payment total of $2100. No PMI would be paid on Home #1 because I would have over 20% to put down.

Home #2

We figured the cost at financing $417k. Reason for that number is because anything over $417k is considered an Jumbo loan and interest rates are .75% higher than a conventional loan. Payment before Taxes and PMI is $2433. Plus we had the taxes and insurance figured out at about $585 per month for a total Payment of $3018 per month.

That's a difference of about $900 per month. I have to admit I was thinking it was going to be a little closer in payment that that. But I guess the taxes are more than I figured because of the Value of the 2nd home.

Like many others have expressed we are in the drivers seat in this market. Our KB Home will not be finished until April or May so we have some time to decide either way. We will continue to look around and see what else is out there in the area.. Thanks for all your insight.

Last thing I want to do was to be House Poor. I think we will sleep on this awhile and not make a hurried decision.

Also as far as the Semi truck pulling my Toyhauler that is long gone. I bought another on after I owned that one. Both were investments and I made money one each and both were bought and paid for cash. I have a hobby of buying and restoring Class 8 trucks and reselling to pull RV trailers. These trucks were both bought for under $25k, restored and sold for $35-40k. There is no better way to pull one of these Monster toyhaulers. I currently pull my toyhauler with a Dodge Dually 1 ton and that trailer will push my truck anywhere it wants. I am currently looking to buy a Peterbilt 387 to restore and Register as an RV again to pull my Trailer. When I say restore I mean these are truck with alot of miles 700-1million miles and I gut the interiors and redo and repaint the exteriors, build a bed on the back etc....

 

[FJRMGM]

going against the grain here - for the kind of money you are talking about you could live in a rented condo for a long time and have a hell of a life without being house poor from a $350k mortgage payment.

Maybe home prices appreciate greatly where you live but in Houston a house is not a great investment.

The more I think about it the less I like living in and paying for a house and all its associated costs like insurance, maintenance, property taxes, etc.

 

[twowheelnut]

going against the grain here - for the kind of money you are talking about you could live in a rented condo for a long time and have a hell of a life without being house poor from a $350k mortgage payment.

Brilliant!