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Started By
Message
Selling a House and buying a new one with these interest rates.
Posted on 8/28/23 at 11:32 am
Posted on 8/28/23 at 11:32 am
Just wondering what y’all would do with the interest rates being 7% and buying a new house.
This is a corporate relocation so moving expenses and closing costs on both houses will be paid. Current mortgage rate is 2.6% and hope to get anything below 7% on new house.
Option 1: Would be take equity in current house which is somewhere between 450k to 525k and put another 100k out of pocket and buy a house cash between 550k and 625k. Keep in mind all closing costs are paid on this house. But this won’t be a house I will be in for longer than 3 to 5 years.
Option 2: Buy what I really want and finance no more than 350k and this will be a house I’m in for 10 to 15 years which would put me at 57 in 15 years and retirement age.
Option 3: Rent for a couple years then build a house I want when I have a better understanding of the area. Problem is I lose out on the relocation closing costs and that will be on me in a few years.
Moving from Baton Rouge to the Woodlands/Spring area.
This is a corporate relocation so moving expenses and closing costs on both houses will be paid. Current mortgage rate is 2.6% and hope to get anything below 7% on new house.
Option 1: Would be take equity in current house which is somewhere between 450k to 525k and put another 100k out of pocket and buy a house cash between 550k and 625k. Keep in mind all closing costs are paid on this house. But this won’t be a house I will be in for longer than 3 to 5 years.
Option 2: Buy what I really want and finance no more than 350k and this will be a house I’m in for 10 to 15 years which would put me at 57 in 15 years and retirement age.
Option 3: Rent for a couple years then build a house I want when I have a better understanding of the area. Problem is I lose out on the relocation closing costs and that will be on me in a few years.
Moving from Baton Rouge to the Woodlands/Spring area.
This post was edited on 8/28/23 at 4:15 pm
17
Posted on 8/28/23 at 11:37 am to Rize
I lean towards renting for a little bit then building or buying. If it's a new area you don't know much about I think I'd like to scope out the area for a year before I decide where I build\buy my 10-15 year home
Posted on 8/28/23 at 11:40 am to Rize
Sell current house
Put 20% down on new house
Put remaining cash in short term treasury fund at fidelity
Negotiate with seller for lower price - it has turned into a buyer market
If rate is an issue, have them lower rate with more up front basis points in closing fee since it is being paid by someone else
You have liquidity in case any problems arise
You should be able to get a nice house at a lower rate
Check with your cpa on interest deduction
DO NOT overspend for a new house - try to find a nice house well below budget and give yourself enough money to save long term each month
Put 20% down on new house
Put remaining cash in short term treasury fund at fidelity
Negotiate with seller for lower price - it has turned into a buyer market
If rate is an issue, have them lower rate with more up front basis points in closing fee since it is being paid by someone else
You have liquidity in case any problems arise
You should be able to get a nice house at a lower rate
Check with your cpa on interest deduction
DO NOT overspend for a new house - try to find a nice house well below budget and give yourself enough money to save long term each month
Posted on 8/28/23 at 11:53 am to Rize
Option 2 or 3.
If you really don't know the area that well, plus whether or not they'll be any chance you relocate again or new job etc. Then renting for a year or two at least leaves you where you don't feel trapped because of housing give opportunity to reassess and build a new home.
But if you have a general feel for the area. I would buy the long term home. It's where you'd want to be, plus if interest rates do go down again, you can refinance when needed.
If you really don't know the area that well, plus whether or not they'll be any chance you relocate again or new job etc. Then renting for a year or two at least leaves you where you don't feel trapped because of housing give opportunity to reassess and build a new home.
But if you have a general feel for the area. I would buy the long term home. It's where you'd want to be, plus if interest rates do go down again, you can refinance when needed.
Posted on 8/28/23 at 11:53 am to Rize
Double post
This post was edited on 8/28/23 at 11:54 am
Posted on 8/28/23 at 12:06 pm to Puffoluffagus
quote:
Option 2 or 3. If you really don't know the area that well, plus whether or not they'll be any chance you relocate again or new job etc. Then renting for a year or two at least leaves you where you don't feel trapped because of housing give opportunity to reassess and build a new home. But if you have a general feel for the area. I would buy the long term home. It's where you'd want to be, plus if interest rates do go down again, you can refinance when needed.
My wife is already there working weekly and coming home on weekends. She will be doing this for a few months so I’m hoping I have a better idea of where to buy once my house sells.
One problem is I’m not really set up good for renting because I’ve got a Great Dane and Great Dane boxer mix so it may be difficult to find a place to rent with such large dogs. Another is I have a Tesla and I refuse to charge at a public charger so I would need to install one in a rental.
This post was edited on 8/28/23 at 12:08 pm
Posted on 8/28/23 at 2:53 pm to Rize
quote:
won’t be a house I will be in for longer than 3 to 5 years.
Don’t buy, rent.
Posted on 8/28/23 at 4:03 pm to Rize
If they are paying closing and relocation, I’d do option 1. You should have no mortgage and will be living for essentially free with an asset you can sell later. You are paying cash in a climate where other buyers have 7% mortgages so you get better value. This option means there is no rush to find land if you decide to build. This is also your best option given your large dogs and need for charging.
The other thing you could think of is buying a large house that needs work and is underpriced in your dream location (say 450k max) and then renovating it while you rent. Doesn’t solve your rent issues but would give you best value and you’ll have exactly what you want in the end.
The other thing you could think of is buying a large house that needs work and is underpriced in your dream location (say 450k max) and then renovating it while you rent. Doesn’t solve your rent issues but would give you best value and you’ll have exactly what you want in the end.
This post was edited on 8/28/23 at 4:24 pm
Posted on 8/28/23 at 6:31 pm to KillTheGophers
quote:
it has turned into a buyer market
Not at these prices. People still not budging.
Posted on 8/28/23 at 8:20 pm to Rize
Option 2.
But in lieu of negotiating down the price - negotiate for seller concessions, use the concessions toward a 2-1 buydown, or a 3-2-1 buydown. It’ll save you more than negotiating down the purchase price.
Then, hopefully in 3 years, rates have come back down, you refi. Our company is offering lender-fee-free refis for purchase loans closed with us, and then refinanced with us.
I’m also located in Houston. Happy to chat, let me know if you’d like to talk.
But in lieu of negotiating down the price - negotiate for seller concessions, use the concessions toward a 2-1 buydown, or a 3-2-1 buydown. It’ll save you more than negotiating down the purchase price.
Then, hopefully in 3 years, rates have come back down, you refi. Our company is offering lender-fee-free refis for purchase loans closed with us, and then refinanced with us.
I’m also located in Houston. Happy to chat, let me know if you’d like to talk.
Posted on 8/28/23 at 8:27 pm to Rize
Option 2 then refi cash out when rates drop to get your money back to buy bitcoin
Posted on 8/29/23 at 9:58 am to SDVTiger
quote:
Option 2 then refi cash out when rates drop to get your money back to buy bitcoin
I’m done with crypto
. Posted on 8/29/23 at 9:59 am to Rize
quote:
Option 2: Buy what I really want and finance no more than 350k and this will be a house I’m in for 10 to 15 years which would put me at 57 in 15 years and retirement age.
I'd probably go with this one. Do you think you'll want to spend retirement in this area?
Posted on 8/29/23 at 10:25 am to Sterling Archer
quote:
Option 2: Buy what I really want and finance no more than 350k and this will be a house I’m in for 10 to 15 years which would put me at 57 in 15 years and retirement age. I'd probably go with this one. Do you think you'll want to spend retirement in this area?
I’m not sure if it will be in the Houston area. I’ll probably have a place in Texas to be my main residence and maybe have another place in the mountains or beach house.
Could see it being the Hill Country or San Saba area in about 15 to 20 years. My wife is 45 and talks about maybe retiring in 10 years but 15 at the most.
This post was edited on 8/29/23 at 10:29 am
Posted on 8/29/23 at 10:29 am to Rize
me personally? I aint doing shite unless I can do it all in cash/equity. My 2.6% 15 year mortgage is great and I would be a fool to take on a new mortgage right now.
Posted on 8/29/23 at 11:49 am to notsince98
quote:
me personally? I aint doing shite unless I can do it all in cash/equity. My 2.6% 15 year mortgage is great and I would be a fool to take on a new mortgage right now.
Ideally I would have liked to stay in my current house for another 5 years or so and then I could pay cash and not worry about interest rates. That’s not going to work with my wife working in Houston now. Outside of me not selling my house for what I want I’ll be moving. I’m not willing to drop my house too much though. If that’s the case I’ll get her arse an apartment in Houston
This post was edited on 8/29/23 at 11:52 am
Posted on 8/29/23 at 8:52 pm to Rize
Woodlands property tax is around 2% and they reassess annually.
Also if you need to get into the city daily, don't be in the woodlands.
Also if you need to get into the city daily, don't be in the woodlands.
Posted on 8/29/23 at 9:26 pm to down time
Where would you recommend?
Wife’s office is around 45 and 1960.
Wife’s office is around 45 and 1960.
This post was edited on 8/29/23 at 9:43 pm
Posted on 8/29/23 at 9:32 pm to Rize
Magnolia
Tomball
Tomball
Posted on 8/29/23 at 9:49 pm to Rize
We are in a very similar situation, selling an upper $800K house and 3 acres and with even 50% down on the houses we’re looking at, the remaining balance would have over $4000 note.
We’re signing a 12 month lease tomorrow, it’s a nice neighborhood, not where we’d build a home but established, well maintained and kept and house had 3 garage spots and bonus room to help store some of the stuff we have in our bigger home. This will get us off the road, give us time to sort and downsize and watch for building prices to drop.
We’re signing a 12 month lease tomorrow, it’s a nice neighborhood, not where we’d build a home but established, well maintained and kept and house had 3 garage spots and bonus room to help store some of the stuff we have in our bigger home. This will get us off the road, give us time to sort and downsize and watch for building prices to drop.
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