Housing Advice.

[jackdanson]

Currently I'm living in an apartment, I'm 26 and my wife is starting to get the baby itch.  We are planning on waiting another year or so before starting to "try" for a baby, but I'd like to get our housing worked out beforehand.  We are currently in a small 1 br apartment.  We love our location and are quite happy with our complex.  Obviously I'd love to buy a house, but I don't know if we could pull it financially.  Let me clarify, we COULD quite easily find a house in our price range, but it wouldn't be in an area we want to live in.  So I'm trying to decide what to do and have it narrowed down to 3 options.  The way I am budgeting now I am looking for something to hold us over for four or five years until I have a good chunk of cash to put down on a house.  By then our incomes should be quite a bit better too.

1.  Get a 2 bedroom apartment at our complex.  As I said, we are quite happy with our complex, they fix everything lickity split and our rent is pretty cheap, it would only be a bit more to get a 2 bedroom.  Obvious con is that we are just tossing money away.

2.  Buy a trailer.  My mom's friend is selling a mobile home less than a mile from where we are now.  For all intents and purposes we would be getting the mobile home for free.  We would only have to pay lot rent.  The park that it is in is extremely nice, by mobile home standards, and we would be literally across the street from my sister-in-law.  (this is good)  The trailer itself is older, but in pretty good shape.  All we would have to pay is lot rent, taxes, and utilities; meaning we could save quite a bit of cash.  The con of this is that I can't get over the stigma of living in a "trailer park".  I don't look down on people who do, but I know there are those who do.  If we went this route I would definitely want to be in a a conventional home by the time our child gets into school.

3.  Buy a condo.  There are some condos around me that are in our price range.  They are fairly nice, about the same size as a 2 br apartment.  Obviously we would get more out of this long-term than the other options, although we would still have to pay every month for condo fees.  Cons are that this is the most expensive option.  Condos are hard to sell, from what I hear.  I'd hate to get stuck in a condo and want out of it when it comes time to buy a house.

Anyway thanks for any advice you can give, oh wise folks of APS.

[Boomhauer]

Personally I'd take the trailer or larger apartment option. The way I see it, this is a few years only arrangement, so I wouldn't want to take on the possible burden and expense of a condo for that short period of time...

Course, I don't know much. I'd defer to some of the more experienced folks on this board...

[Sergeant Bob]

I've lived in them all, and I would go for the trailer as a temporary option. If people are going to stereotype because you live in a trailer, then they are total @$$wholes anyway and it doesn't matter what they think.

[Boomhauer]

I've lived in them all, and I would go for the trailer as a temporary option. If people are going to stereotype because you live in a trailer, then they are total @$$wholes anyway and it doesn't matter what they think.

Hell, if you're white and don't live in a city (a proper city, like NY, Chicago, Boston, LA, San Francisco, etc) you are automatically assumed to live in a trailer anyway.

[Nick1911]

I've lived in them all, and I would go for the trailer as a temporary option. If people are going to stereotype because you live in a trailer, then they are total @$$wholes anyway and it doesn't matter what they think.

Well said.

Personally, I'd stay in an apartment, but that's because I like having other people fix things, and apartment living is familiar from my college days.

[Northwoods]

1.  Get a 2 bedroom apartment at our complex.  As I said, we are quite happy with our complex, they fix everything lickity split and our rent is pretty cheap, it would only be a bit more to get a 2 bedroom.  Obvious con is that we are just tossing money away.

Probably your best bet.  However I'd only make the move once she's cookin' that bun and even then only once you're reasonably sure it'll be a healthy pregnancy.  Even then you could just stay where you are at until the kid was a year old, give or take.  They won't know the difference, and won't be mobile enough until then for the apartment to be a problem anyway.

2.  Buy a trailer.  My mom's friend is selling a mobile home less than a mile from where we are now.  For all intents and purposes we would be getting the mobile home for free.  We would only have to pay lot rent.  The park that it is in is extremely nice, by mobile home standards, and we would be literally across the street from my sister-in-law.  (this is good)  The trailer itself is older, but in pretty good shape.  All we would have to pay is lot rent, taxes, and utilities; meaning we could save quite a bit of cash.  The con of this is that I can't get over the stigma of living in a "trailer park".  I don't look down on people who do, but I know there are those who do.  If we went this route I would definitely want to be in a a conventional home by the time our child gets into school.

If, IF, the trailer really is free, AND in decent condition, then this could be a reasonable deal.  But if it's needing any work of significance I'd pass even if it is free.

3.  Buy a condo.  There are some condos around me that are in our price range.  They are fairly nice, about the same size as a 2 br apartment.  Obviously we would get more out of this long-term than the other options, although we would still have to pay every month for condo fees.  Cons are that this is the most expensive option.  Condos are hard to sell, from what I hear.  I'd hate to get stuck in a condo and want out of it when it comes time to buy a house.

Better than terminal renting, but not a great choice for a short term transitory state.  Selling any property (inc condo's) is not free.  Plan on at least 8% of the sale price being lost to realtor fees and other closing costs.  Condos in many markets also don't appreciate as fast as a similarly priced detached house. 

Also you have to figure in condo association dues, which can be pretty significant, in addition to property taxes and homeowners insurance when figuring monthly payments.  If you put <20% down add some PMI as well.  Once you get that total payment figured, and look at the portion that's going to loan principal you may wish you were renting.  Especially when crap starts breaking and it's your dime to fix rather than a landlord's (when you own the home and plan to stay there long term that's not such a big deal though).

Regardless of what you choose to do, though, make a concerted effort to have an emergency fund set up in addition to your down-payment fund before you buy.  That emergency fund should have 3-6 months of normal living expenses in it.  That will cover your ability to deal with any problems that might crop up after you buy the house.  If you get a sudden freeze one night a month after you move in and a pipe bursts flooding a couple rooms destroying a few thousand dollars worth of flooring and drywall and furnature you'll be able to deal with it without the stress of how to pay for it, or the stress of payments on new debt incurred as a result.

[roo_ster]

We bought a fixer-upper (house) a year or so before kiddos and we don't regret it one bit.  Similar apartment space would be much more expensive than our mort+tax+ins. 

If it were me, I would not get a larger apt or condo.  The condo will cost to buy and to sell and will have downsides similar to an apt WRT kids.  The greater apt rent will make it more difficult to save for a house.

Status quo (sitting tight in current 1 BR apt) is viable for a couple years of childhood, until you want to be able to take the kiddo out in your own yard & whatnot and you want kiddo in his own room.  Frankly, until then, kiddo can sleep in a bassinet or crib in your room.  If you wife intends to breast-feed, a cobbled-together mini-bassinet attached to her side of the bed will do the trick until the kiddo is done breast feeding.

The trailer is intriguing.  If it truly is nearly free, and the other monthly expenses are less than your current apt, it might be the best financial bet.  If the trailer park/neighborhood is nice, don;t worry about what other folk think.  A buddy of mine owns a trailer park where he rents out units and he has some wisdom to impart:
1. Single-wides rent & sell more easily than double-wides.
2. Fumigate the ever-loving shinola out of it before you move in.  We're talking three courses of bug bombs, different brands/poisons for each course.
3. Thoroughly clean the sucker, top to bottom before moving in.  Same with carpet, paint, etc. if you are to do that.
4. Where he lives, $15K is the minimum for a decent single-wide.  You can pay less, but you'll have to spend the different to fix it up.

[cassandra and sara's daddy]

2. Fumigate the ever-loving shinola out of it before you move in.  We're talking three courses of bug bombs, different brands/poisons for each course.

with last course being 10 days to 2 weeks after first course   look for one that leave an egg killing chemical

[Jamisjockey]

Depends on the trailer park.  Go stake it out after dark.  Some parks are very quiet during the day, and scary at night.  Some parks have HOA like standards, which keeps them nice and quiet and keeps the rif raff out. 
When we lived in Utah, I had plans to move my Mom out from Kalifornistan, and we were in a position to afford purchasing her a trailer and helping pay the space fees, etc.  Checked out two parks throughly, one was a little creepy at night.  The other, I'd have considered living in myself.

[Brad Johnson]

1.  Get a 2 bedroom apartment at our complex. 

2.  Buy a trailer.  My mom's friend is selling a mobile home less than a mile from where we are now.  For all intents and purposes we would be getting the mobile home for free.  We would only have to pay lot rent.

3.  Buy a condo. 

1) If you can't find a suitable home to purchase in your price range, and the living conditions at the apartment are acceptable both physically and financially, do it.

2) The situation you lists is about the ONLY way I would ever suggest a trailer.  Trailers are consumables.  They are like a battery, you buy them to use them up.  They depreciate just like a vehicle does.  Plus, they are a PITA to get financing for, and if you do it will he hellaciously expensive.

3) NO! NO! NO! NO! NO! NO! NO!  The only time I recommend a condo is for people who can buy them outright.  Aside from condo's being hard to finance (changes in mortgage regs made sure of that) they tend to be hard to market in some areas.  Plus, your condo association fees are often as much as the payment.  You are also beholden to condo rules and regs, and don't be surprised when they hit you with an assessment for some emergency repair.

The first thing you need to to is set a budget for your total house payment (principal, interest, taxes, insurance - PITI).  Then meet with a lender and see if your budget number and your ability to be approved are compatible.  Then investigate the market in your area and see if there is a property that meets your budget and geographic requirements.

Also, don't fall into the "Big Down Payment" trap.  In most areas the principal and interest part of the payment runs roughly 60% of the total payment.  If you put 10% down you aren't knocking 10% off the payment.  You are knocking 10% off of 60% of the payment.

Also, count on interest rates going up.  We've become spoiled to fixed interest rates in the 5-6% range.  That's low.  Very low.  The 30 yr average for fixed rates hovers around 8%.  Okay, so you saved for two years and have a 10% down payment, but the interest rate is now 7%.  Will the downpayment savings offset the increased interest?  Are you factoring in market growth/shrink in your area?

Examples:

Typical current 100k FHA guaranteed mortgage
3.5% down
5% ficed rate
Estimate $350/month taxes and insurange
P&I  $518.03
PITI $868.03

Same loan, but at 10% down and 7% interest
P&I $483.14
PITI $833.14

You save $418.68 per year on the payment by waiting so that would be the good thing to do, right?  Not so fast.  There's more to the equation.  Let's say your area is experiencing an average market growth of 3% (30 yr average).  That's $3000 a year in market appreciation. 

But wait, there's more...!!

In some areas the market is still slightly depressed (from 5-20%, depending on market and how the evaluation is calculated).  For the $100k above you might be able to find a house that will appreciate faster over time due to market depression rebound.  (History says it will happen).  Let's be conservative and say that you will realize an extra 2% annual appreciation, an annual total of $5000.

There's lots of stuff to consider other than just the downpayment and interest rate.  Do your research before making the leap.

Brad

[BridgeRunner]

Yea, we lived in a very nice trailer park.  Didn't stop my neighbors (two houses' worth, not sure how that worked out) from having a screaming, scratching, wrestling, cat-fight on my lawn at four in the morning.  I'm guessing alcohol was involved.  Too bad I didn't her about it until the next morning, because it would have been real amusing calling the cops.

Then there was the charming gentleman who told me that he was going to take a sledgehammer to my windshield--whether I was in the car or not--the next time he saw me get too close to his landscaping.  Apparently someone in a car that looked vaguely like mine had torn up six inches of his lawn.  At the time, I drove a black Neon.  'Cuz there were no other black subcompacts in the trailer park, of course.  

And the dog that barked non-bloody-stop from 8am-5pm every weekday, in the adjacent trailer, about twenty feet from my bedroom window.  I worked evenings/weekends.    

You can get bad neighbors anywhere.  Somehow we got a slew of 'em.  All belligerent, all without any sense of decency or respectability.  We theorized that it was a combination of innate unpleasantness combined with trailer park defensiveness. I'm no longer a fan of trailer-park living.  

Now the trailer itself, on the other hand, was great.  

[eyebrows]

2.  Buy a trailer.  My mom's friend is selling a mobile home less than a mile from where we are now.  For all intents and purposes we would be getting the mobile home for free.  We would only have to pay lot rent.  The park that it is in is extremely nice, by mobile home standards, and we would be literally across the street from my sister-in-law.  (this is good)  The trailer itself is older, but in pretty good shape.  All we would have to pay is lot rent, taxes, and utilities; meaning we could save quite a bit of cash.  The con of this is that I can't get over the stigma of living in a "trailer park".  I don't look down on people who do, but I know there are those who do.  If we went this route I would definitely want to be in a a conventional home by the time our child gets into school.

About ten years ago I bought a 2br mobile home(already in a fairly nice park) for $2,000. It was a little rough but it didn't leak and stayed warm in the winter. My lot rent was something like $285 a month, with lot rent, utilities, and food my total bills were less than $500 a month.
I lived there building my credit and banking my money for 4 years. In the end with the down payment I could make and my credit score I got a very good deal on the house I'm sitting in right now.

There is nothing wrong with temporarily living in a trailer park. Your friends might get a little jealous when they learn what your monthly expenses are and how much you can save.

[sanglant]

You can get bad neighbors anywhere.  Somehow we got a slew of 'em.  All belligerent, all without any sense of decency or respectability.  We theorized that it was a combination of innate unpleasantness combined with trailer park defensiveness. I'm no longer a fan of trailer-park living.

some people just attract them, welcome to the club.

[The Lone Haranguer]

I suggest the larger apartment if you can't quite swing a house.     Remember that there are a lot of other costs besides just the mortgage payment.     A mobile home in a rented space has all the burdens of home ownership (repairs, insurance, taxation, etc., while still paying rent on the space) and none of the benefits (buildup of equity).      Don't ask me how I know this.        A condo is little better.

[cassandra and sara's daddy]

not sure where you want to live.  we found a great place by going hunting. drove around inthe country stopped at every lil store and checked the bulletin boards. then asked the clerks if knew anyone renting. checking with the local skypilots is also good. the best places go word of moth.  we ended up with a 2 bedroom trailer on 3 acres for 400 bucks. about 150 a month in total utilities plus phone.

[The Lone Haranguer]

The only time I've been burgled was in the mobile home park I lived in.     The "neighborhood watch" probably knew what color my girl's undies were, but when someone (who turned out to be two of the neighborhood teenage punks) carted my TV, VCR and guns down the front steps, nobody saw jack. 

[grampster]

Stretch yourself a bit.  Buy a house.  Prices have been drastically forced down.  Interest rates are low.  You qualify for the $8000.00 rebate.  Repos abound for good deals.  You'd be surprised once you start checking around at how many good deals there will be in good neighborhoods.  Go on Craig's list and look for other sites that may have for sale by owner deals.  Some folks are trying to get out from under a mortgage and want to avoid a repo.
You are not in a hurry, so consider the house hunt a part time job that will pay you $8000.00 plus .

[Scout26]

You forgot two other options.

4. Move in with parents.  Yours or hers.

5. Refrigerator box under a viaduct.


(What grampster said.....Plus, once you find something you can come back and pick Brad's brain.)

[Hawkmoon]

You can get bad neighbors anywhere.  Somehow we got a slew of 'em.  All belligerent, all without any sense of decency or respectability.  We theorized that it was a combination of innate unpleasantness combined with trailer park defensiveness. I'm no longer a fan of trailer-park living. 

All of which only proves that "trailer trash" is more than an empty metaphor.

[French G.]

If I ever have to move again and don't see it as being permanent, nice travel trailer, good dually to pull it, find a nice campground with lots of semi-permanent residents. The usual campground atmosphere is often more cheery than a trailer park. And if you don't like it, hook up the 5th wheel and be gone. Once you settle down in a house you still have a nice vacation set-up.

[S. Williamson]

If I ever have to move again and don't see it as being permanent, nice travel trailer, good dually to pull it, find a nice campground with lots of semi-permanent residents. The usual campground atmosphere is often more cheery than a trailer park. And if you don't like it, hook up the 5th wheel and be gone. Once you settle down in a house you still have a nice vacation set-up.

That you will never use again.