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To buy or to rent?

The BF and I had a talk last night about what we should do about our living situation. Currently, we are renting a basement suite owned by my parents for the ridiculously low price of $500/month (including utilities). We have to be out of the suite by November, since it was just a temporary arrangement while I found permanent employment.

My commute to my new job will be about 1 hour each way, because I’m on my scooter. There are also no buses that run out that way, so it’s out of the question to commute with public transportation. I really want to move out closer to work, so I suggested we try to rent a place out that way. Rental apartments or suites are going for $800-$1500/month out in that area. The BF doesn’t really want to rent and thinks we should buy a place instead. We each make the same amount of money, so combined we have an annual income of $110,000. I have no doubt we could afford something easily, and it’d be a great investment, but I’m a little uncertain.

I’ve talked about it before, and buying property is a huge commitment, and one I don’t really feel comfortable doing right now because I don’t have the proper down payment set aside. But, when we discussed it, we talked about how we could put in the contract that if we were to ever break up, we would sell the property and split the profits 50/50 (or have the option to buy the other person out). I could probably borrow money from my parents to match the amount he’d put down for the house, and then pay them back in monthly installments.

It’s definitely something to think about. A co-worker said that there’s a gorgeous townhouse for sale in her complex for only $379,000. We looked it up on MLS, and it has 3 bedrooms, 2.5 bath, a huge yard, and a garage. There’s beautiful hardwood floors, french doors, gas fireplace, skylights, a private patio … and a new roof put on last year. The strata fees are somewhere between $150-$175/month, and to find a townhouse for less than $400k is a pretty good bargain. But I also think it’s a great price because it’s on a peninsula about 45 min. away from downtown, and you have to take into consideration the time it’ll take to commute into the price of the property.

My co-worker also said it’s been on the market for a while and the sellers are desperate because the husband is in the military and is getting stationed somewhere else very soon. So I’m sure the price is going to be flexible. Ideally, we’d want to spend $350,000 max. And if we could get together $35k for a 10% down payment, our mortgage payments would be affordable with our salaries. We could probably even put 5% down and still be okay. I don’t have any debt, and the only debt the BF has is his truck payments which are $420/month. Both of us also have pretty good credit scores.

The property is also in a great location because I’d be 5 minutes away from work, and there’s a bus stop right outside the complex that would go directly downtown to the BF’s work. It would be a 45 min. commute for him by bus into downtown, so it would be him sacrificing for my comfort.

Anyway, we’re going to probably go see my co-worker’s unit on Sunday, since they’re all exactly the same. I mostly want to get a feel for what we can buy with our money, and whether taking the plunge and buying now at this point in my life is a smarter decision than renting for a year or two.

Open houses

Yesterday I left the office a few minutes early to check out two open houses I saw signs for on my ride out to work. I know it’s premature to even think about buying anything, but it’s nice to get a feel for what an open house is like, and how much my money will buy me.

The first house was a cute townhouse for $310,000. It was built in 2005, has 2 bedrooms, 1 1/2 bath, a garage, and a really nice kitchen. Granite countertops, and stainless steel appliances. It was the townhouse closest to the street though, but it had a cute enclosed backyard to make up for it. I really liked it, but clearly it’s out of my price range for the time being.

The second house was just across the street, and it was a condo for $217,000. This is in my price range. It was built in 2004 (or 2005, I forget), has 1 bedroom, 1 bath, and an “office nook” which is attached to the main living area. A nice kitchen, too. The place was okay, but not spectacular. In my opinion, it’s overpriced for only 700 sq. ft., but it’s in a nice area. The strata fees were almost $250/month.

It’s kinda depressing that $220,000 will only buy a tiny condo in this city. If I bought with my BF, we would definitely have more money to work with (combined, we make over $110k annually), but I really want to buy by myself, and build up my own equity. Plus, if we ever broke up, neither of us could afford to pay for the mortgage of a more expensive property. I guess big decisions and changes lay ahead of me in the next year or so!

I’m really wanting to buy in a year, but I’m also thinking about renting in order to save up more money. If I rent for a year or so, I would be able to save up at least $1,000 a month if I find a job that pays me what I’m making now. It would be great to be able to put down the entire 25% down payment required in order not to pay that stupid mortgage insurance, but I doubt I could save up that much, that fast. But I guess it depends on what the market is like, my job situation, and other variables.

Doubled the debt today, and still smiling!

Well, there goes my dream of getting a free computer. The transaction finally posted to my Visa, which is making me pretty depressed. Just when I was less than $3k in debt, I had to go and double it. I don’t regret the purchase, because I know I’m going to love it, but still. At least on a positive note, by May 25th at the latest, I should be completely 100% out of consumer and student loan debt. So the computer basically added on 6 weeks more of living with debt, and when I think about it that way, it’s not so bad after all! :)

I met some really important deadlines at work today, which I’ve been stressing out about for the past few weeks. To congratulate myself, I went shopping online. Well, not really. I didn’t buy anything, I just lusted after things. Clothes, mostly … but also funky accessories, and home items I’ll never be able to afford. Browsing online was probably the worst thing in the world I could have done for myself, because I love shopping. So to calm myself down, you know what I did? I logged onto my city’s public library site, and put Shopaholic & Baby and Save Karyn on hold. Normally, I would have just popped down to Chapters and bought myself both books, but I saved myself a ton of money and will borrow them instead. Even though I’m hold number 196 of 196 for the Shopaholic book, and they haven’t even gotten any in circulation yet since it just got released. Sigh.

After I finished torturing myself by pretend-shopping online, I went pretend house-hunting online instead, and hit up my favourite real estate sites, MLS.ca and comfree.com. Most of the homes in my price range are ugly and dated, or super small and cramped. But there are some gems out there. I am really looking for a chic loft in the city, or a condo/townhouse in the suburbs that isn’t completed dated. At this point in my life (while I’m young and just starting out), I think the city loft sounds more appealing, but most of them are so small (500 sq. ft or less). I guess you have to sacrifice space to get city living.

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