Home, to rent or to own?
 

I know that a RX-7 forum is not the best place to ask this but, I hate to start a new account else where on the internet. I am currently in the Navy and I maybe able to move out of the barracks soon. I will thinking about renting an apartment till my so to be wife gets down here and we get married. After that I was thinking about getting a house owning one. I know it is currently a buyer market but, since I do not want to live in Jacksonville for the rest of my live and the navy doesn't have to keep me here I am unsure if it is wise. Or if it is wise to buy a house at all. I am 25 but i have never had even an apartment, So I am a little lost on what I should do. Or what I should educate my self on. There is help with this thru the navy but I figure I could get a bigger sampling of life lessons learned on here. I know a few years ago buying a house would be ok because it was a sellers market. Any help would be great.

Buy then if the navy moves you, rent the property. Buy smart, there are a lot of good deals out there so take your time and find the right one.

If you use the va loan to buy you can not legally rent, they have clauses in it just for that. go through other means if you plan on renting it out in the future.

There is now a clause that will help you if they move you and you are unable to sell your or rent your house.

It's always a better option to buy/own if you have the resources to do so

no offense but you should stay out of florida thats just my opinion

Why is that? Is it better to own in GA?

i am curious as to why you say this? not trying to be an ass, but its always good to hear someone else's opinion? flaco, sign up for the churazco meet on Nov. 5th. Largest Rotary meet in south FL.

i think as long as you buy property with the following criteria you will never get yourself in a bad position.

1. cash flow
2. amortization
3. depreciation

i know that this property is for your own personal use but the probablility of it becoming a rental property in two/three years when you get relocated is good if not great .

so think of how much you can rent the property for in realtionship to your purchase price. then make sure the cash on cash return given that potential income is at least 15% or higher and your are good to go, no matter what state you purchase in.

If theres anyone you should take advice on this subject is this guy here... ^^^

dude, if you're just getting out of the barracks, I'm assuming that you're an E-4 or somewhere thereabouts. Doing this could get dangerous if you don't have a legit savings account going on. I

'm in the Navy too, and a LT at that. I'd have a hard time if my house were unable to sell when I PCS... theres just no way I could support a mortgage (or TWO) or a rental AND a mortgage.

We just dont get paid enough to play the housing market like that anymore, those good times are over.

I am currently a E-3; however the advancement for my rate was 100% last cycle. So I guess it is better to rent a house with roomates. I would like a garage, I miss having one especially with a car that needs this much TLC. also to keep my motorcycle out of the weather.

thanks :icon_tup:

i disagree with your statement. now is the time to buy. renting or selling was good when everyone was buying during the "good times". i know its really easy to say it now, "hind sight is 20/20" but i was one of the furtunate that did not get caught with property i could not afford becasue i always buy with the three criteria listed above. i think if you buy wisely, you will never get yourself into trouble.

I dont know your financial position nor would i ask that you disclose it on a public forum but dont be dicouraged by what the majority of people are "doing" and "not doing" as far as real estate is concerned.

the numbers dont lie. where else are you going to make 15% cash on cash return:scratch: I can answer that, no where. Not CD's, MM, Mutual Funds, Stocks etc etc......invest your money wisely. invest your money in long term investments that will yeild passive income.

sorry to be long winded, i just really enjoy this subject!

When I said "good times," I really meant the ability of a sailor to do LOOOONGG tours in the same duty station, before Perform to Serve graced us with its presence. Theres really no guarantee that a sailor will remain a sailor past his initial OBLISERV. E-4's (if thats the case) generally dont have the money to throw at a house - and be comfortable enough to sell on short notice.

I have heard of fellow sailors having a house payment as low as 600 per month. Which is about the same as renting a crappy apartment.

True... but it also boils down to how much they put down on their house.

Also look at the consequences of not being able to pay a mortgage post getting kicked out of the navy vs not being able to pay rent...

I never said "dont buy a house." If your bank account supports it, I'm all for it! In my world of 3 year orders - maximum... it doesn't fit. I'll wait until I hit LCDR or retirement, or so I think.

Gotcha.....i totally misread that as "good times" in real estate :blush::blush: idont know anything about the navy so i will keep my comments to myself


if you can rent that same house for $1000 per month you would make a decent return. net proft would be $400.00 per month or $4800 per year. Lets say that house cost you $110,000 (Purchase Price). Now if you are common "joe" like me that cannot qualify for Government morgage programs i would have to put 20% down or $22,000.00. That gives you a 21% cash on cash return on your money assuming $600.00 mortgage payment that includes Mortgage and insurance. now if i can qualify for a Navy mortgage program and only have to put out 5% or 10% the mortgage is higher (Not by much, especially 30 yr conventional), cash flow is lower BUT Cash on Cash return goes up!

I was in the Air Force for 10 years before I got out and I have bought a few houses and I got lucky and sold one during a PCS, but I got unlucky another and ended up foreclosing on it. I f I could give you any advise, I wouldn't purchase a house until your are somewhere you want to be and know you are going to be for a long period of time.

Wow how did I miss this thread. I actually have to run off to a REIA (Real Estate Investors Association) Meeting here in a few. Believe me that I'll be back to chime in. In the meantime, listen to Paps, he is one of the other knowledgeable investors on the forum that I am aware of.

Normally I'd have some harsh words for the person who said, "Stay out of the Florida" but I'm going to let it pass at this time.

The next few years are absolutely some of the best times ever to buy a home for both personal and/or investing purposes. Jacksonville is great because it is a depressed market that will eventually make a comeback and you have both military and industry there. I had 11 units in jax, 5 duplexes near Cecil field that I sold and I still have one property up in Jax. My current focus is Tampa.


I'd like to suggest you choose carefully who you receive your advice from in this matter. Are you going to listen to someone who knows what they are doing such as Simon or myself (over 100 properties owned or managed and actively investing still) or some guy who just says "Stay out of Florida" with no reason why?

My personal philosophy is to listen to people who have achieved what I want to (aka been there, done that) and ignore those on the sidelines who have never played the game. =)

Edit 2: Using banks to buy real estate is just silly in particular now since they want 20% down and a 750+ credit score*. I've never used a bank to buy a property ever. Even for apartment complexes, private money is the way to go...especially nowadays.

*Please note I understand there are benefits of buying as a member of the military that non-service people don't have. As an investor I find banks to be ridiculous and would be hard pressed to imagine a situation where I'd use one...but that is another topic. =)

My posts were meant to chime in on the disadvantages of being an active military member (in this situation). MANY active guys have bought houses and been successful, but there are guys that have been screwed solely because of PCS'ing... and that is reason enough to not buy until I get out. Or until I have enough to pay in cash.

Owning a house is awesome... in Florida, even better. Owning a house ANYWHERE sucks if you cant afford to get rid of it, or pay two mortgages at once because you cant even sell it to take a SMALL loss - and because your job tells you "well, your 3 years are up, pack your shit and go (for no reason other than your slated time is up)."

Mid: Traveling at the moment but my statement was not directed at you. :) it was at the poster who said not to buy in Florida and has provided no basis for that statement or investor credentials. My apologies for not being clear as to whom I was disagreeing with. This is the best buyer/investor market any of us will most likely ever see in RE.

Nah, I understood where you were directing your comment, no apology needed. Being absolutely forced to move sucks sometimes, and realllllly junior military guys sometimes need input from the not so junior military guys. An E-3 doesn't make dick for the amount of work that he's required to do, and thats by no fault of his own. I barely think *I* have any business buying a house (right now), and I make at least twice what he does (which still isn't much).

Really, BAH (basic allowance for housing) was designed to offset the servicemembers' cost of RENTING a house/apt while serving on active duty. Not many know this, but BAH rates are designed to pay for not just your rent, but also utilities... so the rent, while a significant portion, is not the whole shabangabang. The govt's idea is for servicemembers to rent lower than their BAH.

If I could re-wind time I would not have bought anything untill I planned on living there for 5-7yrs. I suggest you rent until you find that city and then buy your dream house.
Don't count on having a renter and don't underestimate being a landlord. I am a landlord for several co-owned properties and stretched myself personally into three homes.

My endgoal was always to move back to Merritt Island, FL. And I finally did it. But, instead of buying my dream $800k house on the Atlantic, I am stuck with my third $250k home with no equity in any of them.

Before I bought my first home my Pops told me to rent until I had decided on my final city and I decided to buy houses and sell them for profit. Just don't depend on anything... like chickens before they are hatched.

So many guys I work with here buy houses then can't sell or rent them when they go to leave. I'm even referring to those who buy in Jacksonville and commute up here to the subbase. Unless you're planning on being there for years, don't buy. I own a house in my home town that I bought prior to joining. I still haven't sold it. I have tenants now, but they'll leave eventually. Just ask me how much it sucks to pay rent and mortgage at the same time.