Reconsidering our decision to rent

[Pollyanna]

If you guys are leaning toward Oro Valley, that house is a steal. You wouldn't get Wilson but you would get Coronado (also a k-8, just not as good as Wilson). The high school is Ironwood Ridge and is fantastic. The Oro Valley Basis is less than a ten minute drive. Plus, for Oro Valley you are close to a lot of great shops etc, and it's in Rancho Vistoso. The only downside is your hubby's commute but if he is fine with it then it's really a non issue. A 100% mortgage for that home would be less than $1k/month (of course you need to factor in taxes and insurance) which is likely less than your rent at the other home. Plus, I would be willing to bet you could easily rent it out given it's location if need be in three years, and you will have three years of a mortgage deduction on your taxes. I would consider buying for sure (which I know everyone else will disagree with but this is a good investment property at a minimum if the inspection checks out).

ETA: Zillow still has the estimate at $378K, which is probably close to the fair price for that home in a good market. I agree that a home in Rancho Vistoso is not going to drop below what they have it priced at currently, and a slight uptick in the economy would allow that home to sell for closer to $250K. The more I think about it the more I think I would make an offer at this point, you clearly have good instincts. Note: I am the person who bought a house over the phone without ever stepping foot into it .

I also noticed that it is close to Northwest Hospital and a lot of activities for older adults as well so you will have a broad selling base if you end up leaving in three years.

[Vanquisher]

Are you planning on working?

It's a lot of money and house for a residents salary alone.

[houseelf]

BTDT-twice. We bought both times because the first rental market was RIDICULOUSLY tight and the second rental market was going to eat up 60+ percent of the take home salary. The first time we made a killing, the second time makes me naseous to remember. I've looked at this thread several times trying ot give you advice but I can't figure out for the life of me what the right advice is. I don't envy you.

[Pollyanna]

U of A salary is really really good especially considering the col. The benefits are also cheap but crazy good.

[v-girl]

Are you planning on working?

It's a lot of money and house for a residents salary alone.

That's what I was thinking.

[peggyfromwastate]

For most people I'd be like "hell no--- rent. Do not buy". But for you... You have so much real estate experience already. I totally get the desire to own and have it on your terms. And if at the end of the day you have acquired an "investment property" that's not the end of the world. Dh and I would be willing to keep our house as a rental except for the fact that it's located in maryland where there are ridiculous fees and taxes (well beyond normal) that add around $300 a month to the landlord, on top of really pricey prop management companies (starting at 8% plus first months rent all to them). It's just not worth it here--- but if that area is more landlord friendly... Why not?

[Deebs]

I agree with Heidi. Unless you have significant money to put down or a job in place I think you'd be hard pressed to get a mortgage and a tough time paying the mortgage plus upkeep.

[peggyfromwastate]

I was also going to add that it seems like my parents pool has some major issue every year. A leak, or a pump not working, or something. It's always a big job. True the pool is about 18 years old, but this has been going on for years!!! Probably since pool age 10--- there's been some major thing every year that runs at least 1000$. On top of energy, water (yikes the water bill when they found the underground leak?? Insane), and regular maintenance. Then there was my sons near drowning in their uncovered pool, so they installed an automatic cover which cost something like $8000.

Pools are for rich ppl. Like dawktors lol.

[ladymoreta]

Would you have the money or equity to sell it at the end of residency? It would likely be about $20k, right, with your realtor fee + $5000 buyer closing costs? That's what we're running into - we can't afford to close, even though houses in our neighborhood sell in about 2-3 weeks. How much would a property manager cost on top of the mortgage and maintenance if you kept it as a rental property? You'll also likely be paying out the nose for licensing, boards, interview travel, relocation, etc. at the same time.

I'd just rent... But we didn't put any money down on our house, so we're not in a great place financially right now. I'm wishing we'd rented.

[MDPhDWife]

Are you planning on working?

It's a lot of money and house for a residents salary alone.

I'm not currently working, but with the high rent we're contemplating, I've come to terms with the idea that I may end up needing to get a part time job. Tara, since you're local, how much do you think I should figure for taxes and insurance? I'm pretty sure even with those added in we would be saving $600 a month compared to the rental house. That would mean I likely wouldn't need to work, but with renting it's a big possibility. The expense of pool repair and maintenance seems to be the big X factor.

Tara is right, UA does pay better than most residencies. In fact, if IIRC they are the highest paying residency for Ophtho. We don't know how much medical ins costs yet which has me a little nervous.

As for downpayment, we could have put down 30K-35K, but since I didn't think we were buying, I sunk that money into paying cash for a car when DH crashed his a couple weeks ago. So now we may only be able to put 3% down. We don't have any debt other than school loans which are about 80K.

I wonder if DH would qualify for any first time homebuyer programs since he's never bought a house. I bought the house we just sold by myself before we met.

Kelly, what you said really resonated with me. This could very well be one of those decisions I'd regret either way I go. It eats my lunch to pay 63K in rent over three years and not have anything to show for it.

[Pollyanna]

I agree with Heidi. Unless you have significant money to put down or a job in place I think you'd be hard pressed to get a mortgage and a tough time paying the mortgage plus upkeep.

Except it will cost you more to rent in Tucson than it will to buy.

Charlene, sit down (or more likely text) with your hubby about this. The ONLY con about buying right now is having to sell at the other end (especially given your short time frame). But this house (providing it checks out) has the potential to be an amazing investment. That house is less than 10 minutes to Ventana Medical Systems which is a large employer in Tucson and recently acquired by Roche. Also, since Oro Valley is on the west side of Tucson your home would only be about an hour commute to Casa Grande. Many folks who work in Casa Grande live in Tucson. Another plus is that Oro Valley is next to the Town of Marana. Both areas now have forward thinking politicians in place that are moving developments forward and are working hard to attract businesses.

In the end, only you and your hubby can decide what is best for your family. How much money can you afford to leave on the table? Are you willing to throw money away on rent? Find out why this house is not selling. It could simply be the market. Coming from someone who has lived nearly her entire life in this city I'm not sure I would rent given the investment potential but I come at real estate from a completely different angle than most people. If you want to look into getting pre-qualified for a mortgage I can give you the name of a lady at Wells Fargo who is awesome. WF also does physician loans on new purchases in Tucson. Another good option is Mutual of Omaha. We have a loan with Compass but they suck IMHO.

[Pollyanna]

Taxes and insurance will likely run somewhere between $300-400/month total. You can get a good deal on your homeowners through the University. Health insurance is about $150/month, dental is $50, and vision is $16. These are all family plan EPOs and you will have very little out of pocket expenses (we pay for practically nothing). You can get cheaper dental but I pay for Delta because we love our dentist (Dr. Mooberry). Also, dh has had a salary increase every year beyond the standard bump from moving up to the next training level.

[spotty_dog]

Kelly, what you said really resonated with me. This could very well be one of those decisions I'd regret either way I go. It eats my lunch to pay 63K in rent over three years and not have anything to show for it.

As compared to paying $41K in mortgage payments and estimated $7200 in home maintenance costs and $14000+ in closing costs and about $9000 in property tax, and have about $14K in equity to show for it? And that's assuming the property value holds steady -- from what I've seen, while the decline in most of the country has slowed, and it sounds like Tucson didn't get hit quite as hard as say Phoenix, that doesn't mean that home prices are going to start going up again any time soon.

I'm sure it's tough to go from being a home owner to being a renter. But there's a lot of freedom in renting, too. Good luck!

[Vanquisher]

I'm not saying not to buy, FWIW, just that we were at a program with great compensation and our mortgage was 165, and no pool, low property taxes, and it was HARD.

I'm saying maybe lower your price range. I'd try to stick to 175 at the most.

[Deebs]

If you're really interested, I would call a lender. It will give you such a better picture once you know what you can get approved for. Loans have just really changed in the last couple of years. Looking at that house, I'd be tempted to buy it too, and it might be a great investment. You might even want to keep it and rent it when all is said and done, but until you talk to a bank, you really don't even know if you could get a loan.