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Buying a house
- Thread starter dbatt005
- Start date
I bought a house in Pensacola, its actually half of a duplex. 3 bed 2 bath, 1300 square feet, good size for a first time buyer. I figured why pay someone elses mortgage, and since houses here are VERY cheap compared to most other markets, I figured it would be a good time to get my feet wet in the world of real estate. I think P'cola is a great place for a starter house.
Also, several of my instructors who seem to know a lot about real estate say its a good time to buy here, because we will be getting 600 more airforce students here within the next few years, not to mention pensacola is growing in both young populous, and especially retirees.
I paid 92000 for mine, which is more than covered by BAH. My monthly payment is only about 700 bucks. If you can get a couple roommates (which I had for awhile) you'll make out like a champ, and it will be a lot cheaper for them than an apartment.
Some things to keep in mind though, once you get going with school, you'll realize how hard your mothers job was when you were growing up, and with everything going on at the squadron, you'll have a lot less time than she did. Being a bachelor, I'm a mess already. Having two others in there with you...prepare for constant mayhem (unless you happen to be a neat freak). And you will find that after a rough day or flight, the last thing you want to do is vacuum or mow the lawn. And theres always that whole hurricane thing too.
But all things being equal, I'm glad I did it. I'm going to try to rent it out when I leave here shortly. You will learn a lot about the process, and if you are not married, it will really give you a leg up when you end up buying a different house with your wife down the road because you will have some idea of whats going on. Plus you will build equity and your credit score will go up (assuming you pay on time). I think its a solid investment if you are willing to take on the added responsibility.
Oh yeah, I strongly recommend the Navy Federal Veterans Advantage mortgage. It was 1000 times better than Bank of America, and way faster on the approval as well.
Also, several of my instructors who seem to know a lot about real estate say its a good time to buy here, because we will be getting 600 more airforce students here within the next few years, not to mention pensacola is growing in both young populous, and especially retirees.
I paid 92000 for mine, which is more than covered by BAH. My monthly payment is only about 700 bucks. If you can get a couple roommates (which I had for awhile) you'll make out like a champ, and it will be a lot cheaper for them than an apartment.
Some things to keep in mind though, once you get going with school, you'll realize how hard your mothers job was when you were growing up, and with everything going on at the squadron, you'll have a lot less time than she did. Being a bachelor, I'm a mess already. Having two others in there with you...prepare for constant mayhem (unless you happen to be a neat freak). And you will find that after a rough day or flight, the last thing you want to do is vacuum or mow the lawn. And theres always that whole hurricane thing too.
But all things being equal, I'm glad I did it. I'm going to try to rent it out when I leave here shortly. You will learn a lot about the process, and if you are not married, it will really give you a leg up when you end up buying a different house with your wife down the road because you will have some idea of whats going on. Plus you will build equity and your credit score will go up (assuming you pay on time). I think its a solid investment if you are willing to take on the added responsibility.
Oh yeah, I strongly recommend the Navy Federal Veterans Advantage mortgage. It was 1000 times better than Bank of America, and way faster on the approval as well.
Yes, I am closing on a new construction in Cypress Creek at the end of this month (Marine SNFO). Buying is definitely the way to go for current FO studs (in my opinion) because the housing market is at a low point, and the supply is much higher than the demand. In most cases, you can place a bid on a home considerably lower than the sale price, and barter with the seller until you reach a happy medium. Case in point: The home we bought just appraised for 30K more than the final sale price. I think it would be sensless not to go into a home that already has substantial equity. Chances are, in a couple years the market will have improved for the seller, or you can rent it out.
Cheers,
Paul
Cheers,
Paul
Let me provide the counterpoint here. First a little background. Navy SNFO, currently in the A-pool, currently renting a house here in P-cola. My wife and I owned our house in Pennsylvania (where I was stationed for college). We loved owning our house, and we're going to buy again once we get wherever we wind up eventually.
Having said all that, we're renting down here, for a couple of reasons. Firstly, there is the ever present hurricane threat. It looks like we're not going to have any trouble this year, but next year, who knows. I would rather be out only the stuff inside the house, than I would lose the entire house, falling at the mercy of the insurance company to save my bacon as far as the actual house is concerned. Add to that the skyrocketing insurance rates themselves, if you can even find someone to insure you at all down here.
Next, we just don't know how long we're going to be down here. The oft-mentioned wait time for snfo's is getting much shorter. It used to be ~9 months or so. Right now, it's looking more like ~4 months, and that includes time to complete ifs. When you think about the fact that you could wind up selecting Maritime/Tacamo right after Primary, you could conceivably be out of here after as little as 12-15 months. Cordspec has some really good points, but remember, he's a Marine, so he's guaranteed Tacair.
So, leaving after only a year and a half could put you in a bad situation. It's true that the market is on a downswing right now, and there are some incredible deals to be found out there. But, I'm not convinced that the market has bottomed out just yet. i.e. you might wind up losing money on the house if you sell. If you go with the rental option, you put yourself up against the hurricane odds. Finally, if you rent, you're going to have to pay the taxes on anything you make on the house when you sell it.
Bottom line, it's all about how much risk you're willing to take on while you're here. It wasn't worth it to me; maybe it is to you or others. Again, just wanted to provide a counterpoint to what's been said already.
Brian
Having said all that, we're renting down here, for a couple of reasons. Firstly, there is the ever present hurricane threat. It looks like we're not going to have any trouble this year, but next year, who knows. I would rather be out only the stuff inside the house, than I would lose the entire house, falling at the mercy of the insurance company to save my bacon as far as the actual house is concerned. Add to that the skyrocketing insurance rates themselves, if you can even find someone to insure you at all down here.
Next, we just don't know how long we're going to be down here. The oft-mentioned wait time for snfo's is getting much shorter. It used to be ~9 months or so. Right now, it's looking more like ~4 months, and that includes time to complete ifs. When you think about the fact that you could wind up selecting Maritime/Tacamo right after Primary, you could conceivably be out of here after as little as 12-15 months. Cordspec has some really good points, but remember, he's a Marine, so he's guaranteed Tacair.
So, leaving after only a year and a half could put you in a bad situation. It's true that the market is on a downswing right now, and there are some incredible deals to be found out there. But, I'm not convinced that the market has bottomed out just yet. i.e. you might wind up losing money on the house if you sell. If you go with the rental option, you put yourself up against the hurricane odds. Finally, if you rent, you're going to have to pay the taxes on anything you make on the house when you sell it.
Bottom line, it's all about how much risk you're willing to take on while you're here. It wasn't worth it to me; maybe it is to you or others. Again, just wanted to provide a counterpoint to what's been said already.
Brian
ryann24
Ry
We bought a home here in Cantonment almost exactly a year ago and knew when we purchased it that we were keeping it as a rental. There aren't many places where you will be able to buy something (with 0$ down) and be able to rent the home close to your mortgage payment. We also felt that buying more north of Pensacola would make it much more safe for hurricane season. If you plan on keeping it long term, go for it. If you plan on turning around and making money in a year, probably not. We came from Va too, and it is defenitely not the same market as Va Beach. If you need any more info, pm me
Good luck!!
Good luck!!
USAA has a very affordable policy...well, then again, I live in Milton ~200' ASL...
Whatever house you buy...don't pay more than 90% of the asking. Unless it's new construction...than pay 100% of the asking IF they throw in a fence, irrigation and sodded lawn.
You think I kid, but I don't.
~D
Having been in the real estate market in Pensacola for years before relocating recently to glorious Meridian, I think it's a great time to buy there if you'll be around long enough to realize the investment and/or you plan to rent it out when you leave. It has been my experience that USAA frequently has sthe best price with both mortgages and homeowners (and rental) coverage. With regard to hurricanes and the risk involved, it's not always relative to location (i.e. north vs. south Escambia county). You should pay great attention to the flood zoning, both your risk and your insurance costs vary greatly based upon zone and it isn't always relative to the salt water only. Just my two cents.
Warning: I know between zilch and zero about owning a home. After having said that, I regularly read the Pensacola News-Journal (the local paper down here) and almost daily there are letters to the editor about how people are either having to move out of the area or live very, very tightly with their money because of how their housing insurance premiums have sky rocketed recently. One person wrote about how their premium went from just over $1,500 to over $9,000 recently. Like I said earlier though, I don't know squat about owning a home. I just thought you should be aware of what is happening to some people down here due to the insurance premiums. Hope this helps....
Been down this road a few times. Thoughts to consider:
- If a real estate agent is involved and the price appreciates at about 2-3% per year, then at 2-3 years when you sell it, you've broken even. But you really need to look at the total economic picture of your situation as to what break even means (e.g. BAH + "more dollars" to pay P&I, taxes, utilities and maintenance vs BAH to live in base housing + zero "more dollars). What would you do with those "more dollars" living on base).
- Base housing is something to take a look at. When you're a SNA/SNFO, fixing stuff in the house is no fun. Living on base was and still is a pretty good deal from my perspective if you're in the area for only a couple of years and especially if your on O-1 pay.
- What is happening in the local and national economy with respect to price appreciation? Don't ask the real estate agent this question. Look it up.
- One bit of advice that has served me well is when it's time to leave and the question is sell or rent, sell it if you're not coming back.
- You'll hear more stories about how folks "made out like a bandit" than you will hear about "boy was that a mistake". It's human nature to not brag about financial mistakes.
- Concur that USAA is great and you should compare them with www.afi.org . I'm with USAA and have been for a very long time.
- For mortrgages, NFCU (and maybe USAA) have programs where you put zero down and 3% down (like VA but the money goes against the principle). I don't consider VA a good deal for most people because when you give VA 3% it does not go to principle.
Cheers!
- If a real estate agent is involved and the price appreciates at about 2-3% per year, then at 2-3 years when you sell it, you've broken even. But you really need to look at the total economic picture of your situation as to what break even means (e.g. BAH + "more dollars" to pay P&I, taxes, utilities and maintenance vs BAH to live in base housing + zero "more dollars). What would you do with those "more dollars" living on base).
- Base housing is something to take a look at. When you're a SNA/SNFO, fixing stuff in the house is no fun. Living on base was and still is a pretty good deal from my perspective if you're in the area for only a couple of years and especially if your on O-1 pay.
- What is happening in the local and national economy with respect to price appreciation? Don't ask the real estate agent this question. Look it up.
- One bit of advice that has served me well is when it's time to leave and the question is sell or rent, sell it if you're not coming back.
- You'll hear more stories about how folks "made out like a bandit" than you will hear about "boy was that a mistake". It's human nature to not brag about financial mistakes.
- Concur that USAA is great and you should compare them with www.afi.org . I'm with USAA and have been for a very long time.
- For mortrgages, NFCU (and maybe USAA) have programs where you put zero down and 3% down (like VA but the money goes against the principle). I don't consider VA a good deal for most people because when you give VA 3% it does not go to principle.
Cheers!
MasterBates
Well-Known Member
Plus, if you are just renting, when you get divorced, it is FAR easier to get the lease changed to the ex's name, vs still having to pay for a house that you cannot live in..
$950 a month (and I had a cheap house I bought as an Ensign, most have more like $14-1500) adds up quick when you have to pay that and rent elsewhere.
$950 a month (and I had a cheap house I bought as an Ensign, most have more like $14-1500) adds up quick when you have to pay that and rent elsewhere.