My life took a turn I never thought it would - I am about to move in with a guy. I had been setting a personal timeline in my mind to move out by the time I am at the end of the 2nd year of my job. Housing prices are crazy here in California, so I figured I would be moving into an apartment for a short time.
I have been looking at houses recently on a website and eyeing a particular neighborhood, an older neighborhood, built post WWII and the houses in the area range from 1946-60. The houses range from 1,000 to 1,600 square feet. The houses are all well kept and almost all have redone kitchens and bathrooms. The costs range from $140-180k.
I don't plan to be moving into one of these as I'm about to move into a nice modern house with my BF, but I have been encouraged by our friends J&B to have a house as a rental. Mike says it should be local so I don't have the problems J&B do.
Being a teacher I can qualify for some special programs for low down payments etc. I have been playing around with some statistics and seeing what I can afford using online mortgage calculators.
$15,000 down (9%)
Loan left is $150,900
Interest rate about 2.75-3%
Term - 30 years
Monthly payment would be about $616.04
Property tax rate about 1.25% to be about $2,100 a year
Insurance about $1,000 a year
Monthly payment about $872 including taxes/insurance
The house could be a good investment, a place to move into if things were to not work out... Would be nice to rent out because I am local and can keep an eye on it - not like J&B who have investment properties all over.
I know that no more than 1/4 to 1/3 at most should be dedicated to your house payment, and that would be a little less than 1/3 of my income.
Should I save for a larger down payment and more expensive house?
Thoughts? I'm sure this won't be in the next couple months, but something I think about over the next several months. There is one house though, that I REALLY like at the moment and has a Palm Springs look and feel to it with modern updates and this funky Victorian bathroom. The bathroom would need help.