Moving to cali.. better to rent or just buy

[Mistawall]

so in the near future im plannign a move to the big cali forn I A. i already have a buddy out there who i was planning on getting an apt with. i been savin my money and will prob have about 50k when i go out there... so im curioius should i just rent an apt or look to make a down payment on a house and pay a Mortgage? i figure between the two of us paying the mortgage shouldn't be a problem and then if i move back to ct i figure i can either keep renting the house to my buddy and have him find a roomate or sell... any experienced thoughts? i have no experience with this stuff

[Pantless Spency]

what area of California?

[Mistawall]

probly so cal. my boys in oceanside currently and thats where he works so prob something in that area

[Farbin Kaiber]

Rent, sounds like you are taking about six to nine months of expenses.

Not to mention, your first foray into Real Estate in what I'm assuming will be you in southern California being a real big dumb move.

[ParsedOut]

Yup^^^ Unless you plan on staying in socal for a long period of time (dear god help you) then just rent a house/apt and make your life 10x less complicated. Yes, that's a proven figure, wait for the P&R trolls to drop in and demand I site my source...but I digress.

[mrsleeve]

nothing wrong with renting, dont for the love of god tie your self to SoCal with real
estate the taxes alone will eat you up

[Mistawall]

yeah thats what i was thinking but then someone put that idea of buying in my head so i figured half the people on this forum are from cali so they could give me some insight. might take me a bit to find a job and i could live for a few months off my savings but if things don't work out in 6 months ill prob just come home

[Stanley Rockafella]

sounds like a solid plan

[Dozyproductions]

Rent first. Plenty of people own houses in soCal, don't get scared ;) You can always figure out the job situation first and slow the role with your rock star lifestyle.

[FredK]

I'll echo what most of these guys are saying. You sound like a young guy, and it makes the most sense to remain mobile if your timescale looks like you might do a stint for a year or two in CA, and move back. However, I would not be so quick to say that taxes alone will kill you. In Oceanside it appears that HOA dues can easily be the same amount as RE taxes.

Real estate taxes in Oceanside do not look out of the ordinary, and there certainly seem to be some entry level homes that you should easily be afford for little more than a rent payment.

Here is a useful calculator to help you make that decision, and to see what kinds of things will play into the decision of rent vs. buy.

http://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html?_r=0

What's going great for you is that you're going to have a good sized downpayment. If you have a solid employment history and a good credit score, it will be that much easier to get a mortgage. If any of these things are lacking, you will have a much tougher time getting financing.

[blunttech]

No way Id ever buy a house with anyone unless they were servicing me.
If you arent getting some its not going to work out.

[Mistawall]

thanks for the feedback guys. just gonna keep saving till i make the move figure it out then prob end up renting see how i like it.

[FredK]

No way Id ever buy a house with anyone unless they were servicing me.
If you arent getting some its not going to work out.

Right, you will not want to have you and a friend's name on a mortgage. Say he wants to sell and you don't, or either of you loses a job and can't make a share of the payment. Things can get really contentious over money.

The mortgage should be in one person's name. That person should have sole responsibility of paying the mortgage, taxes, and association dues (if any).

thanks for the feedback guys. just gonna keep saving till i make the move figure it out then prob end up renting see how i like it.

You're likely going to have to rent to get an idea of the local market anyhow, if you do plan on buying.

You will want to also think about your exit strategy. Ask yourself, will it be easy to sell the house? Some markets are really slow, where houses can stay on the market for 3 - 6 months or more. It's hard to generalize about RE. Some areas are stagnant and others aren't. It really hinges on the stability, size, and expansion potential of the local job market. The more stagnant an area, the harder it will be to sell a house for the price you want to sell at.

[Mistawall]

yea i wasnt planning on putting my friends name on the mortgage only mine.

[gte175x]

I would NOT buy right away.....Take a little time and figure out if you like it and which areas you would want to be.

Depending on what you are looking for....housing can be quite expensive. 50K probably won't cover the 20% down to escape PMI, plus if it's a condo or something you will also have an additional expense of HOA, which can be as high as 300+/mo. this generally won't reduce your taxes so it's an additional ~$500/mo you don't get gov credit for. Having a roommate to help pay down your mortgage is nice and definitely the way to do it. But most likely in Cal, It is the only way most people can afford places - so then you are always stuck with a roommate unless you can personnaly cover the mortage, which is tough here. Cal rent aint cheap, but you do get a lot more bang for your buck if you rent something from someone who bought a while back. the rent is cheaper because their mortgage is cheaper, and you get more space. Not putting you off your dream, just give yourself a little more time to figure out if California is for you. It will eat all your money and then some, and you don't want to be a slave to it, at least until you've decided to make Cal your more permament home.