# 23, working and trying to decide to buy or rent! Advice PLEASE



## BYak (Jul 31, 2012)

Hello, 
So I started working on Coronation Alberta in May (Small town (1000ppl) East of Red Deer, East of Stettler). Ive been renting at a town nearby (I have a company truck so its not really an expense) and recently have been looking to buy something. Now, here is the HUGE caveat: I only want to be here for 1.5 years, then I want to travel for a year, then settle down closer to the rockies and home. So my reason for being here is work and getting some expirience before trying to get a job in my "ideal" location (or a transefer) I like my company and job but this area is not my cup of tea.

However, I have been really interested in real estate investing, home improvements (what else am I going to do in the winter around here?!) and love the idea of having a cash flow and my first property before 25.

The place ive looked at is a mobile home- its $29 000 BUT the relator knows thier story and thinks I can get it for 24000 (I know kind of suspesious- the place is basic but nice- nothing wrong that I can see and I will obviously get an inspector). I want to plan to pay this off in 1 year as to not have a mortgage holding me back when i want to travel. 

Here are my finances

Income: 3400/month (in pocket)
TFSA: 3000
Stock: ~1500 
RRSP (1800 currently- comes off my check)
Travel Fund: 6000 (can use as a down payment- but will be repaid)

Cost of House:" 24000
Taxes 500
utilities ~150/month
Renos ~1500
Cost of living ~1000/month

I have paid off my student loans, own my car, and have no credit debt. 

So the plan is to pay it off in a year, Which means by the end of the year I could have either 18000 to invest/use as a down payment when I settle OR a 24000 house. Well I dont think the buying market for mobile homes here is great I do KNOW the rental market is pretty good- lots of term workers and such and there isnt much to rent in town. 

I would like any advice on the matter. Should I buy? Rent? It seems like a good investment for where I am and where I want to be but I might be blind to some looming misery. Would it be better just to have a bunch of money saved in a year or have that money stored in a home? Is home equity with a renter worth more than invested money? (I would probably add to my stock portfolio and invest in MICs (both traded and brokered))

THANKS

Here is the listing FYI 
http://www.hoss.pcspro.com/detail;jsessionid=0DF3CB783B7C111EB02AC9C56912DA52?mls_number=326508


----------



## Just a Guy (Mar 27, 2012)

Trailers are not good investments. Not only is the resale low, but you have to usually "rent" the pad it sits on, so you're still a renter. Next, you may find getting a mortgage difficult. Banks don't like small mortgages, they also don't like trailers. 

If you're going to travel, how are you going to manage your rental?

As for an inspector, most are useless and not worth the $350 they charge. A lot are ex-realtors, and know nothing about construction.

I think you should check out articles on www.easysafemoney.com...thing like rent vs. own, inspections, etc. are all on there...the book may also be of interest to you.


----------



## the-royal-mail (Dec 11, 2009)

Well, I guess the question is why would you want to tie yourself down to something with the risk of not knowing how long it will take to sell at the other end? Why not just save the cash and rent?

I see no valid reason why you need to rush into this at your age and stage of life. It isn't the right time for you.

Hopefully your mind isn't already made up.


----------



## BYak (Jul 31, 2012)

*No pad fees*



Just a Guy said:


> Trailers are not good investments. Not only is the resale low, but you have to usually "rent" the pad it sits on, so you're still a renter. Next, you may find getting a mortgage difficult. Banks don't like small mortgages, they also don't like trailers.
> 
> If you're going to travel, how are you going to manage your rental?
> 
> ...




Hey Just A Guy, 
The trailer sits on a freehold, no rental fees and I'd own the double lot. It's been "planted for 38 years and finished with stucco. I've talked with my bank and they will move forward with it (I was surprised they didnt care they were only making around 600 bucks off me...)

Very good point about managing the rental while away. I have good friends in Edmonton who have agreed to the hypothetical situation... not ideal I know. But im thinking, for that year I travel, if I'm not making money off it that's okay. I also contacted a few property management companies out of Red Deer- they would basically charge me lot for travelling fee but would be nice to have someone taking care of it while I am away. 

Inspectors I hear are hit-or-miss, I've looked into a few reviews on google (thank got for the internet!) and think Ive found one but F* its $550  

So do you think this information helps? I know they typically dont have good resale so should I still put the time and effort into doing reno's? Or just become a slum lord?!


I should also update yesterday I placed a false add on kijiji, just to see if there were renters biting. I put it up for 750 w/out untilities and a 750 dd and a min of 8 month lease. I had three replies by last night and all were "very very interested" "call me asap". So I took the add down and am now comfortable that renters should be easy (at least inthe short term). 

Thanks!


----------



## BYak (Jul 31, 2012)

the-royal-mail said:


> Well, I guess the question is why would you want to tie yourself down to something with the risk of not knowing how long it will take to sell at the other end? Why not just save the cash and rent?
> 
> I see no valid reason why you need to rush into this at your age and stage of life. It isn't the right time for you.
> 
> Hopefully your mind isn't already made up.


Thanks for your advice- I kind of need to hear that. I havent made up my mind but I seem to waffle both ways depending on the hour... You dont see much of a benefit of having a rental in this situation?


----------



## donald (Apr 18, 2011)

Why not look into buying a residential lot instead of a mobile home(to ''fit" into the kinda #s/purchase power your looking into,2 edge into real-estate?)A building lot imo holds vaule way above a trialer,and has multiply options(sell later on/build a rental,sit on it,wait for capital gains ect)and the bonus is you don't have to be a landlord while away?

If the town is growing(and you can somewhat identify a opportunity) it might be a good play but other than that i would stick to saving.


----------

