Buying a first home versus renting for a year

[Aaron Ohri]

Hello all, I have recently come across a predicament that I was hoping for a little advice on. So I live in Nebraska and am moving to Omaha in the middle of August to live with a friend and begin my career. I just graduated from college in May. We were both approved for an apartment that will cost us each in total about $500 a month with utilities. We are supposed to sign our lease within the next 19 days, but have not signed any legally binding forms. Only put down a $350 deposit that is non-refundable. The short story is that I have been thinking about rather than paying rent for the next year and basically burning $6,000 until next August when the lease runs up and I can buy a house, why not just buy it now and house hack it with a couple of my friends who want to live with me? We are all far passed college party days, and would much rather have a nicer house that we would treat with respect. Plus, it would allow me to get started in real estate investing. Do you guys think it is worth going and getting approved and buying a house, or should I just take another year of paying rent? I have a brother who owns several successful real estate properties who would help me with the process. I will gladly answer any additional questions you need to help with the scenario. TIA for any advice!

[Eric Siebert]

I'm going to have to disagree with Brent Smith on a couple of things in his post. First, I wouldn't necessarily worry about what is going to happen in 4-5 years. You can build up quite a bit of equity in a short time if you are playing it smart. Having renters in your home can be fine. If they are friends or acquaintances it will often be fine. Lay out the expectations and make sure that each roommate understands them. If you are a type A personality, then I would say no. You need to be a bit flexible and allow others to live their lives. While values are not "Skyrocketing" in Nebraska, we have enjoyed steady growth and prosperity for a long time and that doesn't look to be changing any time soon. The $150k houses seem to allow you to get a good value for your money. If buying a house and renting to your friends seems like its a fit for you, do it.