Buy a cheap house or rent a nice apartment?
Saturday, May 30th, 2009
Pol-Enrico G asked:
I’m at a cross roads. For a while I’ve been thinking about not pissing money away every month and jumping into the market. The problem is that my income situation does not allow me to make house payments any larger than what I currently rent for +/- 100 bucks. I realize that in order for me to get into the market comfortably I’m looking at home prices <100K. Well, to no surprise the houses are old and dated and the neighborhoods are sketchy where I live (shreveport/bossier city, LA). For that same monthly payment I'm pissing away on rent, I live in a NICE apartment.
I’m at a cross roads. For a while I’ve been thinking about not pissing money away every month and jumping into the market. The problem is that my income situation does not allow me to make house payments any larger than what I currently rent for +/- 100 bucks. I realize that in order for me to get into the market comfortably I’m looking at home prices <100K. Well, to no surprise the houses are old and dated and the neighborhoods are sketchy where I live (shreveport/bossier city, LA). For that same monthly payment I'm pissing away on rent, I live in a NICE apartment.
So my question is: is it a fair sentiment to consider that the opportunity cost of throwing away money on a nice apartment (and have a good QOL) is worth the equity not being built on a sketchy house worth less than 100K? I concede renting is worthless money-wise, but I cannot sift through the listings and look at these neighborhoods and feel as though it's worth my time when I can be renting a nice place and have QOL.
CURA
