Help me find a way to buy an apartment

[zipdoa]

So... I have been really lucky in the past couple years to inherit a fair amount of money. It's totalled up to about $30k in the past 4 years, and unforunately I blew all of it. I'll be inheriting another $25k in a couple years and want to put it towards something useful... you guessed it, a place to live.

I'm wondering if anyone can give me advice to get prepared to buy a home before i'm 25. I currently make about 38 000/yr and can expect that to be around 42 - 46k in a couple years. In my current budget, I have about $600/month of 'free' cash that I could do whatever with... meaning that after all is said and done (food, clothes, insurance, rent, etc), this is what is left over.

I was looking at place like pointe of view, who are offering incentives like $25 000 towards the purchase of a new Condo, and other cheap houses/splits/apartments in the NW. I would love to live in that new downtown apartment in eau claire, or something fairly similar.

I'm guessing that the real estate market is going to continue to decline, and this will bring more affordable oppurtunities my way. I am 20 right now, but am definitely not short-sighted about my future... I want to be comfortable financially and COMPLETELY independant before I am 25.

Any advice on how to make this happen/save money/programs that would work for me to get me into my own place would be greatly appreciated!

Thanks!

- Mike

[Tik-Tok]

I'm am by no means an expert on financing/realty... but you expect to make around $45g a year, and think you can buy a condo downtown next to the river? :rofl:

[A790]

Originally posted by zipdoa
So... I have been really lucky in the past couple years to inherit a fair amount of money. It's totalled up to about $30k in the past 4 years, and unforunately I blew all of it. I'll be inheriting another $25k in a couple years and want to put it towards something useful... you guessed it, a place to live.

I'm wondering if anyone can give me advice to get prepared to buy a home before i'm 25. I currently make about 38 000/yr and can expect that to be around 42 - 46k in a couple years. In my current budget, I have about $600/month of 'free' cash that I could do whatever with... meaning that after all is said and done (food, clothes, insurance, rent, etc), this is what is left over.

I was looking at place like pointe of view, who are offering incentives like $25 000 towards the purchase of a new Condo, and other cheap houses/splits/apartments in the NW. I would love to live in that new downtown apartment in eau claire, or something fairly similar.

I'm guessing that the real estate market is going to continue to decline, and this will bring more affordable oppurtunities my way. I am 20 right now, but am definitely not short-sighted about my future... I want to be comfortable financially and COMPLETELY independant before I am 25.

Any advice on how to make this happen/save money/programs that would work for me to get me into my own place would be greatly appreciated!

Thanks!

- Mike
Man, the best thing right now is to start saving that $600/mo for your purchase. Put it in something easily accessible, like a GIA account or something. You'll get a bit of a return on it and you can take it whenever you need it.

The bigger your down payment, the more manageable you'll be able to make this thing.



Originally posted by Tik-Tok
I'm am by no means an expert on financing/realty... but you expect to make around $45g a year, and think you can buy a condo downtown next to the river? :rofl:
Why not? If he can swing it, why can't he do it? Who's to say he won't get a roommate or something? I know people clearing less than 50g's/yr that are living in $400,000 homes. They aren't living ALONE, but they're still living there.

[zipdoa]

Originally posted by Tik-Tok
I'm am by no means an expert on financing/realty... but you expect to make around $45g a year, and think you can buy a condo downtown next to the river? :rofl:

I said I would LIKE to. Also take into account I will have a decent sized inheritance going towards the venture. Also take into account I would be looking at buying when I feel the market is at its lowest point. I was just throwing some ideas out there of the type of places i'm interested in, no need to be a downer.

[BigMass]

There are some decent 1 bedroom apartments for under $150k in downtown. I'd set that as my top-end budget with the money you're describing.

[calgarys_finest]

I am in the same boat as the op pretty much(except the inheritance). I have been saving for a while and will have 20k for a downpayment sometime around october your best bet is to put away as much as you can and keep building your credit. Alot of the places that offer incentives usually have a catch so be carefull with those talk to a relator they can help alot be honest with them and tell them the situation that your in. I am either looking for a apartment down town or depends whats around a townhouse in the NW somewhere.

edit: How much are you paying for rent if you dont mind me asking.

[teggypimp95]

Also dont be so worried at what the house prices are. Its going to be your morgage intrest rate that will make the big differnce on how big your monthly payments are. And currently there are some of the lowest interest rates that the banks have seen.

[BigMass]

Originally posted by teggypimp95
Also dont be so worried at what the house prices are. Its going to be your morgage intrest rate that will make the big differnce on how big your monthly payments are. And currently there are some of the lowest interest rates that the banks have seen.

That's not a good reason. Only realtors trying to get people to buy houses use that an an excuse and here's why.

When interest rates eventually do go up, and they will, house prices will drop to compensate for the increased rate. So in the end, if you have a big down payment, it's actually worth waiting for higher rates.

[max_boost]

Save up as much cash as possible and monitor your credit score. Everything will play a role in determining how much you can borrow and at what rates.

Find a place you like that you can purchase within your means. The market will be moving sideways for the next while so you don't have to rush.

[zipdoa]

Originally posted by calgarys_finest
I am in the same boat as the op pretty much(except the inheritance). I have been saving for a while and will have 20k for a downpayment sometime around october your best bet is to put away as much as you can and keep building your credit. Alot of the places that offer incentives usually have a catch so be carefull with those talk to a relator they can help alot be honest with them and tell them the situation that your in. I am either looking for a apartment down town or depends whats around a townhouse in the NW somewhere.

edit: How much are you paying for rent if you dont mind me asking.

I pay $250/month... it's my moms place, but she doesn't live there for the most part.

[teggypimp95]

Originally posted by BigMass


That's not a good reason. Only realtors trying to get people to buy houses use that an an excuse and here's why.

When interest rates eventually do go up, and they will, house prices will drop to compensate for the increased rate. So in the end, if you have a big down payment, it's actually worth waiting for higher rates.

True but i dont think it will be a bad thing. The OP is trying to get into a place with a low budget. Monthly payments are going to be his biggest challage. He can lock in his interest rate for 5 years. Buy now while interest is low and houses are pretty low. Come spring and summer things will go up a bit. And once we are out of this downturn in a couple years, houses will go back up and he could still be locked in with his low interest rate.
I would rather more money being paid towards my house then given to the bank with interest. Your equity will built up alot faster.

[ckangarloo]

^At $250/month, stay there! Condo fees will be around $250/month for a one bedroom anyway.
Don't rush into buying a condo. No point at all for the next year at the earliest.

Save your pennies, lock them into a GIC or a HI savings account.

Try to get at least have a 25% down payment when you do end up buying. No CMHC insurance necessary.

Renting is the way to go for the next while (can't you tell I'm glad I sold my place 11 months ago).

[saiyajin]

wow im pretty much in the same boat as well with about 600-800 per month savings too haha
EDIT: minus the inheritance, got nothing there

looking at either a car or a downpayment to a place... was thinking 175k would prob be my budget if i go it alone for a place(which i would prefer)

what areas realistically would be able to be obtained at that price point??

keep the advice coming!!!:thumbsup:

[ragu]

Originally posted by Tik-Tok
I'm am by no means an expert on financing/realty... but you expect to make around $45g a year, and think you can buy a condo downtown next to the river? :rofl:

Completely doable if you get your shit straight.

I have a friend (21) who goes to Uni, makes $2000 per month and should be able to get his career started in a year or so (Uni done)
He just bought a condo in DT with 50g down (all of it he saved, so you know he is mature enough) and is living alone and managing pretty well. Now obviously to keep expenses low he takes bus everywhere....:bigpimp:

[ckangarloo]

I see that attitudes have not changed much.
This is no longer 2006. Stop watching HGTV with all their quick flips, easy profit. Those days are gone. No more forty year mortgages. In my dad's generation, a twenty five year mortgage was considered insane and rightly so. How can 35 year amortization now be considered acceptable? 35 years is a long time!

Home ownership is something hard earned. Not too long ago, 30 somethings were the first time home buyers. People started saving up in their twenties and eventually had enough to purchase a small townhome then move up from there.

Things got out of whack after 2001 when credit was easy.

Things have just begun to return to normal.

[calgarys_finest]

Originally posted by ckangarloo
I see that attitudes have not changed much.
This is no longer 2006. Stop watching HGTV with all their quick flips, easy profit. Those days are gone. No more forty year mortgages. In my dad's generation, a twenty five year mortgage was considered insane and rightly so. How can 35 year amortization now be considered acceptable? 35 years is a long time!

Home ownership is something hard earned. Not too long ago, 30 somethings were the first time home buyers. People started saving up in their twenties and eventually had enough to purchase a small townhome then move up from there.

Things got out of whack after 2001 when credit was easy.

Things have just begun to return to normal.

Lol so because im 23 i should wait another 7 years to purchase a house because thats what your dad did?

edit i make 38k a year just like the op but i pay 600 in rent i own brand new car and have payments for that and i still manage to save about 1k a month so why shouldnt i buy a house when i feel safe at my job and have been working my ass off to build enough for a large down payment.

[ckangarloo]

Originally posted by calgarys_finest


Lol so because im 23 i should wait another 7 years to purchase a house because thats what your dad did?

edit i make 38k a year just like the op but i pay 600 in rent i own brand new car and have payments for that and i still manage to save about 1k a month so why shouldnt i buy a house when i feel safe at my job and have been working my ass off to build enough for a large down payment.

Sorry if you took offence to that. All I am trying to get across is that buying a condo right now makes little to no sense unless you want to live there forever. Most people purchase condos to begin with and move up to something bigger once they gain some equity out of the thing. Pretty hard to make any equity out of a condo when prices are dropping.

[saiyajin]

Originally posted by ckangarloo


Sorry if you took offence to that. All I am trying to get across is that buying a condo right now makes little to no sense unless you want to live there forever. Most people purchase condos to begin with and move up to something bigger once they gain some equity out of the thing. Pretty hard to make any equity out of a condo when prices are dropping.


well i think it should be somewhat safe if you plan to live there at least 3-5yrs :dunno:

[zipdoa]

Originally posted by calgarys_finest


Lol so because im 23 i should wait another 7 years to purchase a house because thats what your dad did?

edit i make 38k a year just like the op but i pay 600 in rent i own brand new car and have payments for that and i still manage to save about 1k a month so why shouldnt i buy a house when i feel safe at my job and have been working my ass off to build enough for a large down payment.


Wierd... I worked out a realistic budget, and there is no way I could be putting $1000 a month. I net about $1800 a month after all is said and done. Would you mind outlining your budget for me?

[max_boost]

At $250/month I would stay at home too. You should be able to save up quite a bit of $$$. Just coordinate it so when you bring a chick home, your mom isn't there. Or take it to the next level and bring her to the Westin Hotel, Tomco styles. :bigpimp:

[calgarys_finest]

Originally posted by zipdoa



Wierd... I worked out a realistic budget, and there is no way I could be putting $1000 a month. I net about $1800 a month after all is said and done. Would you mind outlining your budget for me?

i will pm you.

[civic_rida]

Good thread.
Since I have expensive taste I have to wait for things to drop some more.
I would hate to be in the situation that my mortgage is 500k even though my intrest rate is 4%

[Redlyne_mr2]

Even though condo prices are dropping it seems condo fees are constantly going up. When i was looking at condos it was common to see 300-500/month fees... forget that.

[Kloubek]

Seriously OP - if you can stand it, live at home and build up your savings. (That means - NO SPENDING NEEDLESSLY!)

I know it's nice to be on your own, and it'll come. But you pay a TON more to do so.... which means it's hard to save when every penny is going to your living expenses!

Anyway... am I the only one who feels it's strange you're "fortunate" to have gotten inheritances? I mean... this means someone died right? ;)

[saiyajin]

Originally posted by calgarys_finest


i will pm you.


want to hook up with your budget as well? looking for ways to cut down and increase savings :thumbsup:

[rc2002]

Originally posted by teggypimp95

I would rather more money being paid towards my house then given to the bank with interest. Your equity will built up alot faster.

If your house is depreciating in value faster than your monthly payments (which is the current environment we're in) then your monthly payments aren't going towards building equity.

Don't rush out and buy a place because of low rates. Nobody knows for sure but the general consensus is that the housing market is going down (or at best sideways). I predict down because the demand for overpriced housing in Calgary is going to drop once the layoffs start.

[Jim Rome99]

I would seriously think twice about buying a place right now, especially at your age and in your financial situation. I was in a similar situation when I was your age a few years ago, but I was making much more than you do now.

I've been renting the place I live in now since I was 20, so it has been five years now. I've saved up a tonne of money towards buying a place. I'm going to wait another couple of years, at least, to see how things shake out in the real estate market. Personally, I think Calgary hasn't even begun to see the downturn that is coming.

The only advice I can give you is to watch shows like 60 Minutes, Bill Moyers Journal, or Meet the Press in order to get a better understanding of the world financial situation and how it affects you. Seriously, do it, you'll save yourself a whole lot of headaches a few years down the line.

[zipdoa]

Originally posted by Kloubek
Seriously OP - if you can stand it, live at home and build up your savings. (That means - NO SPENDING NEEDLESSLY!)

I know it's nice to be on your own, and it'll come. But you pay a TON more to do so.... which means it's hard to save when every penny is going to your living expenses!

Anyway... am I the only one who feels it's strange you're "fortunate" to have gotten inheritances? I mean... this means someone died right? ;)

Since you asked so nicely...

I lost my grandfather in high school and got most of my inheritance just before he died, so we wouldn't have to wait for the lawyers to sort things out, and then I got the rest after he died. I blew it all.

I then got another sum of money just before my grandmother died in France, which I also blew.

I am now getting my last inheritance after my grand-ma's death and don't want to blow it all as well.

[rumeo]

Originally posted by zipdoa


Since you asked so nicely...

I lost my grandfather in high school and got most of my inheritance just before he died, so we wouldn't have to wait for the lawyers to sort things out, and then I got the rest after he died. I blew it all.

I then got another sum of money just before my grandmother died in France, which I also blew.

I am now getting my last inheritance after my grand-ma's death and don't want to blow it all as well.


sorry to hear about your losses, but cocaine is a terrible drug

[assram]

What about rent-to-own?

You pay more every month in total than renting, but most of that goes towards the purchase price of the place eventually.

Example.. 200k place.

Might rent for 1000, if rent only.

rent to own could be like 1600..
800 for rent.. 800 goes into purchase price of condo after a few years..

It's a good way to get into a place if you don't have credit..
And lock into a good purchase price while the market is low..

Of course these are just example numbers, they are adjusted depending on how much downpayment you put down, etc..

[RY213]

Originally posted by BigMass
There are some decent 1 bedroom apartments for under $150k in downtown. I'd set that as my top-end budget with the money you're describing.

There is? Show me where these condos are because I dont see much for decent downtown condos under the $235k range.

As far as budgeting goes, assume you have a $200k mortgage, you are looking at roughly $1000/mo mortgage payment. Add about $275 a month for condo fees, and about $50/mo for electric. Plus you also have cable, phone, internet, car payment, insurance, food, entertainment expenses and so on. You dont want to leave yourslef house poor with no money left over after paying all your bills. Trust me on this one I have been there and life sucks. If you are getting by now with $600 left over after paying your bills, you are nowhere near where you need to be financially. Like others have said, save some money, pay off all your debt and build your credit. Take advantage of your cheap rent now and be patient. Calgary condo prices are supposed to drop an estimated 7-10% this year.

There is a lot of good info in this forum as well, read through all the history and you will learn a lot from others who have been where you are and have made things happen for themself. Lots of helpful people on here too...

[The_Rural_Juror]

If you are in the position to stay at home and save money, do it! Skip the condos and their escalating condo fees and save up for something with some land if possible.

[zipdoa]

I would love to buy back my parents last home and rent it out to 5 buddies... 5983 Dalcastle Drive NW.

Has anybody ever done this kind of thing? (either rented a house with friends, or purchased a house with friends/everyone puts money towards mortgage). I'm not sure if this is even possible?

[Euro838]

Originally posted by zipdoa
I would love to buy back my parents last home and rent it out to 5 buddies... 5983 Dalcastle Drive NW.

Has anybody ever done this kind of thing? (either rented a house with friends, or purchased a house with friends/everyone puts money towards mortgage). I'm not sure if this is even possible?

Depends if you like these friends. :) It is possible and you can search for results here on beyond about what happened.

Don't mix business with friends.

[ee2k]

Originally posted by RY213


There is? Show me where these condos are because I dont see much for decent downtown condos under the $235k range.

As far as budgeting goes, assume you have a $200k mortgage, you are looking at roughly $1000/mo mortgage payment. Add about $275 a month for condo fees, and about $50/mo for electric. Plus you also have cable, phone, internet, car payment, insurance, food, entertainment expenses and so on. You dont want to leave yourslef house poor with no money left over after paying all your bills. Trust me on this one I have been there and life sucks. If you are getting by now with $600 left over after paying your bills, you are nowhere near where you need to be financially. Like others have said, save some money, pay off all your debt and build your credit. Take advantage of your cheap rent now and be patient. Calgary condo prices are supposed to drop an estimated 7-10% this year.

There is a lot of good info in this forum as well, read through all the history and you will learn a lot from others who have been where you are and have made things happen for themself. Lots of helpful people on here too...

If there is a decent apartment condo in downtown for $150K, tell me where it is and I will go buy it this week! And it better not be that high rise in China town!

[thinking out loud here ...]

Re: 200K, based on 5% down and 25 years, at 4.3% 5-year, it's $1030/mo. At 35 years, with same interest (lowest I have heard of lately), monthly payment goes down to 871. When compared to my rent - at 900 now, this is becoming attractive - I used the calculator on realtor.ca (those in real estate can maybe tell me how realistic that is).

This has me seriously thinking about it. However, with an expected drop of 7-10%, that's a drop of at most 20K in value this year alone. Rental lease is coming up, perhaps I should look at a 6mo lease instead of a year?

[extm88]

Originally posted by RY213


There is? Show me where these condos are because I dont see much for decent downtown condos under the $235k range.



I looked at a place that was a foreclosure downtown. It was a loft style just off 14st.
Could most likely get the place for the 150k price range.

[BigMass]

there was actually a top floor 1 bedroom condo that looked nice for $150 a few weeks back. Not there anymore. 150-200 is possible if you take your time looking and negotiate properly

[lasthuzzah]

Originally posted by ee2k

Re: 200K, based on 5% down and 25 years, at 4.3% 5-year, it's $1030/mo.

Where is this 4.3% 5 Year mortgage?

[el-nino]

I offer 4.29 for the 5 year.
I have read this thread and it has a lot of great points. When it ocmes to buying home take your time. With the inventory out there you can find a home that best suits your needs.
I think you need to know what you want. Are you gonna be staying in this for the long run? Are you using as a rental?
The way I see buying houses and borrowing money is damned if you did and damned if you didnt. That is your risk. But if you find a home that you love it may just may out weigh the damned if you did factor.
LMK if you need a pre-apporval.

[atgilchrist]

ING has a 4.3% 5-year right now too.

Anyone want to buy my condo downtown for $205k? Just renoed, S/S appliances and everything...

[ee2k]

Originally posted by lasthuzzah


Where is this 4.3% 5 Year mortgage?

This place also shows 4.19, though not sure about the pre-conditions.

http://www.canequity.com/

[civic_rida]

Im 24 and make less than 6 figures and right now in the process of trying to get a condo in the downtown area. It can be done.

[Antonito]

Originally posted by max_boost
Or take it to the next level and bring her to the Westin Hotel, Tomco styles. :bigpimp:

And don't forget to take pictures

[e36bmw///]

nm

[mazdavirgin]

My main concern with buying a condo is that it is mostly a transitional step... Eventually I figure I will want to have a house but there is no way in hell I can afford a house given the current prices well unless I buy something in Falcon Ridge...

Math just doesn't make sense at the moment and I am making ~20k more a year. Luckily I haven't received any inheritance granted I don't think I would even if it was the unfortunate case of my grandparents passing away. They are not very well off :\ Anyways back to the housing issue at my salary and even if I could scrounge the 20% down payment I would be looking at assuming an insane mortgage on the scale of 35 years at current interest rates. The even sadder part is I would quite literally be house broke. The required monthly payments on the mortgage alone would be ~30% of my gross income. This is all based on a house worth ~320-350.

The way I see it is I am doomed to keep renting :\

[Sailz]

edited