Itchy to buy a house on sale!!!
Hi All -
I currently own two homes, I rent one out for a small annual profit (and I get to write off my annual trip to Hawaii to work on it!) This home is in an excellent rental location, very easy to keep rented. I bought this home as a result of a job transfer.
I live in the other property which was my residence when transferred. We kept the home as we were worried that if we wanted to come back to CA (which we did), we may not be able to afford it if we sold the home. (hindsight is 20/20 - boy do we wish we sold!!!) This has dropped in value by nearly 1/2 since I pulled $$ to buy the other home. While we had 20% equity at the time of the refinance, we are underwater now.
We are in no financial trouble as a result of any of this and are fine with all payments. We have no CC debt, pay off all balances monthly. We have one car loan. DH and I make very good salaries.
I am itchy to buy one of the beautiful homes in the area that have forclosed & are a tremendous value. I would rent out the home that I am currently in until the market turns (I understand that could be a while). We have sufficient savings for a down payment and would not need equity from the other properties to buy the new house.
While being a landlord isn't my most favorite activity, I have done it since 2005 with no problem.
When I look at older folks who have lived through the depression, those who purchased real estate seem to be the most financially secure today. I feel like this could be the key to investing today. Am I nuts?
Am I missing something? What down payment is required these days? We have the $$, but I am hesitant to liquidate too much stock in the current market, so would like to hold as much as possible. Does anyone have a spreadsheet / calculator for multiple property ownership that can help me evaluate / play with the numbers? All I can find online is a basic tool - I need more!
I have read some posts that sound fairly negative about buying homes as investments, and I am curious as to where that comes from?