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Updated over 2 years ago on . Most recent reply

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18
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Sam Fowler
  • New to Real Estate
  • Dallas, TX
3
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18
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Classic Rent vs Buy (Among the crazy market currently!)

Sam Fowler
  • New to Real Estate
  • Dallas, TX
Posted

Hi All,

My fiancé and I live in the DFW area and are currently renting a 1 bed apartment unit. Our lease is up in Feb of 2023 and we're going back and forth on whether we should extend our lease or begin the process to search for a house. I don't currently invest in real estate, but my goal is to hopefully force some equity through a light rehab on a primary residence, and then leverage that equity to begin investing in other properties. 

Obviously there's a lot of uncertainty in the real estate market and economy as a whole right now. With all the craziness happening, would it make more sense to jump in anyway and purchase a house, to then use to buy more real estate? Or should we continue renting while saving and see what happens with interest rates and the market as a whole?

I feel like we'd have to make a decision fairly soon with our lease being up in February. Tough situation cause we'd either have to buy now, or wait another lease term (another year).

Thanks for all your insights!

  • Sam Fowler
  • Most Popular Reply

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    Theresa Harris
    #3 General Landlording & Rental Properties Contributor
    11,175
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    Theresa Harris
    #3 General Landlording & Rental Properties Contributor
    Replied

    Do you plan on living in the area for a few years?  If the answer is yes, then look into buying.  Talk to a bank and find out how much you can afford for a mortgage.  You don't need to (and shouldn't) go to the maximum.  The timing is good as you have a few months to look at places and close.  Prices often go down in the winter.

    The first place I bought when it came time to sell, prices were a bit lower than when I bought it, but I'd lived there for a couple of years, so even if I sold at a loss I had lived 'rent free' for a few years. I kept it and used it as a rental instead of selling it.  I sold it ~15 years later for 2.5x what I bought it for AND my tenant had paid off my mortgage for me as well as cash flow each month.

  • Theresa Harris
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