Quote:
Originally Posted by MJZiggy
To my mind, it depends on the location. If it is in a neighborhood that emphasises schools and kids/etc. then it might be a problem. If it is in an urban area, there will be a market based on young, single professionals. At any rate, if you can get it paid off in 5-6 years and manage to live in it that whole time, that would be pretty amazing. Don't forget though, with condos come association fees so you also have to measure what amenities are available and what all you get for that money.
Pretty amazing? Why?? Pretty smart. Every American could have a PAID FOR house in 10 years, no matter their income. The process is actually quite simple.
1. You need 20% down. (There are ZERO exeptions to this).
2. You need to purchase two homes.
3. The first needs to be approximately half the value of the home you ultimately want to own. A small house/condo/duplex is PERFECT. Location is important. You need to look to re-sale value.
4. You need a 15 year mortgage to take advantage of the lower interest.
5. You need to run an amortization schedule to pay the home off in 5 years.
6. You sell 1st home at 5 - 6 year point, hopefully adding a bit of appreciation.
7. You purchase Home number 2 - your dream home identified in the beginning- at a slightly higher price than you would have 5 years ago, and dump EVERY DIME of equity/cash you received from home #1.
8. You again take the 15 year loan, or lower term if available focused on MINIMIZING the interest rate.
9. You again run an amortization schedule for 5 year repayment.
10. You invite all your friends over for a "mortgage burning" party, and begin to live debt free for the rest of your life.
Yes, I realize that this is ambitious and not something everyone would consider. It, however, CAN BE DONE for EVERYONE. Whether it is a 2 bedroom trailer or a small condo, or a 30 room mansion, it WORKS. It takes discipline, it takes persistence and it FORCES you to live below your means. You cannot make two $500 a month car payments and pay a mortgage payment approaching $2200 a month (for most of us, anyhow), but you CAN MAKE THAT payment if you don't have two car payments.
In the end, it isn't a "stretch" or "overly ambitious", it is about choices. We all make them, we just don't focus on the impact of some of those choices.
Off my soapbox now...