It's 3am and I'm trying to make a decision. So I am talking out loud here chewing on anyone's ear who is bored, just humor me...
So my husband and I decided to build a new house (buying something already built isn't really an option. There is more demand in our neighborhood than supply and houses are selling in less than a week. We also have a timeline thing I'll discuss later. Building a custom home isn't an option because we don't have that much cash laying around).
Ok, so of course I found a few beautiful homes in the $330K range. We could swing it, but we would be barely able to make the down payment/escrow/closing cost and the monthly mortgage would make us house poor. It would drastically change our lifestyle.
Today we found a home model for $230K that's 5 bedrooms, in an addition that allows my husband to have his six foot tall privacy fence and meets most of our checklist. The house isn't fancy, but it's a basic house. The mortgage pretty much would be the same as our current rent. We could easily afford the down payment and I could go in tomorrow to get the process started. Our lifestyle wouldn't be effected by a stretched budget. Now, the only downside is the addition just seemed "chaotic" to me. The location was great, it's right in line with everything we have going on (so no crazy commute or anything). There were a lot of unsupervised kids playing in the streets though, the houses are close together, and there are numerous Sikh families in the addition. Historically the homes have a good resell value (the addition has been there for 15 years we are in the last section). So I think it could be a good "starter home" investment. I'm just concerned that the addition seems, not "junky" but definitely not, "oh wow, nice".
The timeline bit: I have two factors playing here. One is we are coming out of bankruptcy from medical debt (we didn't own assets then). Our date we can officially qualify for a mortgage is the end of October. The second issue is we have baby three on the way. It's due in early Jan and we have no room in our rental home. The reason we are going with a new build is because the companies will accept us on contract now (with an installment of a down payment) and start building. In all the additions we looked at, the houses can close the day after we officially quality for the mortgages again and would be ready to move in the middle of November, which is good for the baby timeline. If we wait until Oct and try to secure a traditional mortgage: we might not qualify off the bat and have to wait longer, and with the demanding market we might not be able to snag something before the baby is due.
So it boils down to...kill ourselves being house poor to invest in a guaranteed nice addition...or stick with the more reasonable modest build and hope that I am just misreading the "junky" feeling of the addition???
Anyone have any experience, lessons learned with this? I should mention this would be our first home, we are in the Midwest, and average home prices are $250K for four bedrooms or more.
It's 3am and I'm trying to make a decision. So I am talking out loud here chewing on anyone's ear who is bored, just humor me...
So my husband and I decided to build a new house (buying something already built isn't really an option. There is more demand in our neighborhood than supply and houses are selling in less than a week. We also have a timeline thing I'll discuss later. Building a custom home isn't an option because we don't have that much cash laying around).
Ok, so of course I found a few beautiful homes in the $330K range. We *could* swing it, but we would be barely able to make the down payment/escrow/closing cost and the monthly mortgage would make us house poor. It would drastically change our lifestyle.
Today we found a home model for $230K that's 5 bedrooms, in an addition that allows my husband to have his six foot tall privacy fence and meets most of our checklist. The house isn't fancy, but it's a basic house. The mortgage pretty much would be the same as our current rent. We could easily afford the down payment and I could go in tomorrow to get the process started. Our lifestyle wouldn't be effected by a stretched budget. Now, the only downside is the addition just seemed "chaotic" to me. The location was great, it's right in line with everything we have going on (so no crazy commute or anything). There were a lot of unsupervised kids playing in the streets though, the houses are close together, and there are numerous Sikh families in the addition. Historically the homes have a good resell value (the addition has been there for 15 years we are in the last section). So I *think* it could be a good "starter home" investment. I'm just concerned that the addition seems, not "junky" but definitely not, "oh wow, nice".
The timeline bit: I have two factors playing here. One is we are coming out of bankruptcy from medical debt (we didn't own assets then). Our date we can officially qualify for a mortgage is the end of October. The second issue is we have baby three on the way. It's due in early Jan and we have no room in our rental home. The reason we are going with a new build is because the companies will accept us on contract now (with an installment of a down payment) and start building. In all the additions we looked at, the houses can close the day after we officially quality for the mortgages again and would be ready to move in the middle of November, which is good for the baby timeline. If we wait until Oct and try to secure a traditional mortgage: we might not qualify off the bat and have to wait longer, and with the demanding market we might not be able to snag something before the baby is due.
So it boils down to...kill ourselves being house poor to invest in a guaranteed nice addition...or stick with the more reasonable modest build and hope that I am just misreading the "junky" feeling of the addition???
Anyone have any experience, lessons learned with this? I should mention this would be our first home, we are in the Midwest, and average home prices are $250K for four bedrooms or more.
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