Buy a house for 1M or continue to rent it for 3K ?

Jan 12 41 Comments

My landlord wants to sell the home we are currently renting for a good offer. We have been currently renting it for 2 years and have an option to either extend the lease for another year or buy it (Price is redfin estimate). We are debating whether to buy or continue renting.
Location is good for our commutes and schools are excellent. Home was built 6 years ago and is in good condition. I'm thinking we can negotiate the price a little bit (upto 6%) by avoiding seller and buyer agent commissions.

Mortgage estimate is 3.6-4K per month including HOA and insurance with 20% down.

what would you do?#redmond

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TOP 41 Comments
  • Get it

    U already like living there.
    Familiar with any problems the house might have etc. Rare opportunity I'd guess.
    Jan 12 0
  • Facebook fbfpahdn
    Unfortunately you are in wa. CA just passed a state wise rental control law that you can live there for ever if you want.
    Jan 12 11
    • Amazon qwertyAk
      Btw, the rent control is 5% gain which doesn't sound that outrageous to me. This law exempts single family homes so it applies primarily to large property owner entities (https://la.curbed.com/2019/9/24/20868937/california-rent-control-law-bill-governor). There is no relation between rent control law and not being able to sell a home, this is totally false.
      Jan 12
    • Google hi?
      I’m a little too high to reply to that right now, but I disagree. But since I’m high, I’m feeling inclined to just express my gratitude and appreciate for you, because you are obviously an amazingly kind person and I wish the world had more people like you. ♥️ But yeah I totally disagree - there is a widely agreed upon ~causation~ between rent control and fewer housing units being developed. If I am a company with fiduciary duty to my shareholders to deliver the highest profits I can, I will not develop housing in highly regulated rent-controlled areas when there are so many other places to build a new apartment complex that do not have those restrictions. It just mitigate risk and has a lot higher upside potential. Result - I don’t build new apartment complexes in San Jose because I can invest it in another city with a higher return, and new housing isn’t built. Oh but wait ! The government has a solution for that too - they’ll just subsidize developers to build in places they need more housing! 🤯 Wait a minute! So they have to pay the developers insane amounts of money to build and rent out housing to people so that the people can have their rent artificially capped at below market value! So the government pays part of your rent then! But wait!!!!! Who pays the government??? Ohhhhh shit now we have to raise state taxes!! Oh shit but WAIT!!! It almost like... it’s almost like... we are adding undue disturbances to the free-market economy that is causing it to be inefficient! Just remove these emotion-based policies and instead listen to the economists that know what they hell they are talking about! We liberals like to say that everyone is stupid for not listening to scientist about climate change! So let’s get our brains out of our asses and start listening to nobel-prize winning economists who have explained time and time again that the evidence is very clear.
      Jan 12
  • LinkedIn haterlands
    It depends on how long you plan on living there. $4000/month sounds pretty low for a million dollar house including HOA. You probably have to factor in property tax and home insurance as well, not to mention anything that needs repairs now falls on you. That might work out to $4500-$5000 a month.

    Over the long run you'll come out ahead, but not for a while.
    Jan 12 1
    • Apple LC->TC
      ^ this, there are many costs first time homeowner may not account for, and you won’t come out ahead for many years. If you still have comfortable budget then this should be a good mid-long-term investment
      Jan 12
  • Google / Mgmt sremus
    Buy it. Getting to live in a house and see the weird problems it might have before you buy it is amazingly valuable. I know as a home owner
    Jan 12 1
    • Facebook O(n!)
      OP
      That's my thinking too. We know all the issues in the house and not going in blind. But another option is to buy a similar new construction home in Sammamish. But commute won't be great. Schools are good there too.
      Jan 12
  • New / Eng
    DragonD9K

    New Eng

    PRE
    Goldman Sachs
    DragonD9Kmore
    You rent a 1M house for 3k a month so your landlord is making less than 3.6% annually. That means rent is too low or house price is too high.
    So that’s just an ok deal, find a better one
    Jan 12 4
    • Facebook O(n!)
      OP
      What's a better deal according to you? If my budget for mortgage is to be close to 4k per month?
      Jan 12
    • New / Eng
      DragonD9K

      New Eng

      PRE
      Goldman Sachs
      DragonD9Kmore
      If you really like the place then at least negotiate a better price. And then buy
      Jan 12
  • Salesforce _mojojojo_
    How is the mortgage only 3.6-4k for a million dollar house with 20% down?
    Jan 12 3
    • Facebook O(n!)
      OP
      Rates are low and I'm planning 7/1 ARM
      Jan 12
    • Facebook public2
      Get a 30, rate is almost identical
      Jan 12
  • LinkedIn U💰S💰D
    Redfin estimates are overpriced so you should just go to some open houses and buy with a fair price.
    Jan 12 1
    • Facebook O(n!)
      OP
      House next door with exact same dimensions sold for 1.15M couple of months the ago. So price estimate is accurate I think.
      Jan 12
  • Google / Eng
    .:

    Google Eng

    PRE
    Samsung Electronics
    .:more
    Given what you're saying here, it is ideal for you to buy the house you're residing in. Make sure you're paying fair price though.
    Jan 12 0
  • Buy it. Lake Washington schools are great and the housing prices in Seattle keep going up.
    Jan 12 0
  • Red Hat fh46xj
    Don’t. Buying condo is a pain in the neck, there’s a good reason your landlord wants to sell.

    If you really want something to be an asset or make something homely enough to live in buy something like a townhouse when you can afford.

    Only exception is when you are ok to take a dent for unforeseen maintenance expenses and you are 100% sure you can rent that condo out without much effort.
    Jan 12 3
    • Red Hat fh46xj
      Go for it
      Jan 12
    • Amazon newuname
      Y would a condo cost 1M in Redmond?
      Jan 12

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