Ok you say it is just you for now. Buy a newer small house with a garage. Now when I say small I mean around 1400SQFT. These will usually have a master bedroom with bath. 1-2 more med size bedrooms, living room dining area.

Buying newer home means less upkeep. Buying a house this size is a great first home. Room for you and wife when you do get married and room for first kid. One of the bedrooms could be your office and the house will likely have at least a single car garage to protect the Camaro.

As your family grows if you have one your house would of went up in value since housing is starting to rebound and you could sell it making some money for a down payment on a bigger house.

Also you can always pay a nieghbor kid to mow the yard if you do not want to. I work 2 jobs and Kathie works so we have a yard guy and cleaning lady that both come once a week. Now I have over a acre of yard and a 3800 5 bedroom house to clean and it cost me 60 a week for yard guy and 64 a week cleaning lady. Yard guy on works 2 times during the entire winter cleaning up leaves so cheap in the winter.

Ok done rambling hope it helped.

House first ... DO NOT RENT

The housing market us so depressed right now you can buy a lot more than if you wait 2 years and the market recovers.

And the tax benefits and equity you will be building are too good to pass up.

Buy the house.

I feel bad for this guy. I'm in a similiar situation and we all know the house is a smarter investment (keyword investment). But the Camaro, now that's passion. I'm currently renting and thinking of which i'd like to do next.

You only live once. Do you really want to be the 70 yr old guy driving 35 in a 55 in his new 500 HP Corvette? lol

If you buy a house, do not but a condo or townhouse. I guess it may depend on where you live, but over and over, I've seen that these are much harder to re-sell than a house.

Unless you are wealthy do not pay cash for a car. With good credit you can get a good interest rate and save your cash. If you keep your cash in the bank you can be looking for a house that fits your needs. If you pay cash for the car it will be hard to save up the money again (since you no longer live with Mom and Dad). The amount of money you will be saving on interest does not make it worth depleating your bank account.

If you buy a house now, let's say it costs you $800. mo.

If you rent an apt. let's assume it costs the same. (normally the same priced apt. will be much smaller but this is a simple example)

Fast forward 20 years... Your house pmt... $800
Your rent, same apt... $1600 (maybe more maybe less)

Equity in home after 20 years on a 30 year note... $30,000 conservative guess
Equity in apt. after 20 years... 0

Many advantages to owning. Few advantages to renting.

Well, I built my first house last year and I had the exact same dilemma as you. Car or House. I chose the house, however, the mortgage payments (plus taxes and increased insurance) are about 2x what I was paying on rent. So I am definitely pissing a way more on mortgage interest than I would've with rent. However, you will get that fancy dancy tax deduction. But really It's only a few thousand dollars so don't get too excited. You still will be paying A LOT of money on interest the first 10 or so years of your loan, most likely more than you would've on rent. So you'll be saving less money in the bank than renting.

But besides debunking the myth that you piss away more money renting, owning a house really does have a lot of benefits. First, if you are a car guy, a garage is a must. You will also have more space to set up an office, or a theater room, or darkroom, whatever it is you want if you're single with no kids. Even in a small house, there's so much space! Since it's your first house, you probably won't stay there for the life of your loan, but if you stay there for 5+ years you will probably make a profit when you sell your house. Even in this soft market.

Yes you'll have to mow the lawn, but it takes an hour once a week, and think of it as your weekend exercise routine! I really recommend buying a new house or one that is less than 3 years old. That way you won't have to worry about repair/maintenance any time soon. The only warning I have if you buy new is that you will have to buy a lot more things to start such as window treatments, flooring/countertop upgrades, landscaping etc. Especially with starter homes, these things are not included in the base price, but they're awfully tempting to buy. Luckily you can roll that into your mortgage in most cases. So don't worry about that too much.

So what's my recommendation? Of course it's buy the house. BUT if you will have enough money to put down on the house and still afford the payments after you buy the car, buy the car, and the house :) When you calculate how much you're going to be paying for a house every month add in property taxes and homeowner's insurance. That can tack on several hundred dollars a month. Oh and plan for $6,000 in closing cots too that you'll have to pay up front on top of your down payment. It should be less than $6000, but it will still end up being several thousand.

And a tip when buying a house. Get approved for a loan FIRST and have the bank write down the loan amount you are approved for and have them write up a Good Faith Estimate of your loan costs. This will include your interest rate (if you lock that day), closing costs, and monthly payment (based upon the maximum amount of your loan) amount among other things. So this will really help you budget! After you have the pre-approval, then you can begin shopping for homes. Most sellers want to see your pre-approval letter before they will sign a contract with you to purchase the home.

Get the Camaro :)

I don't think there is an easy "one size fits all" answer to this one. Like many, my first inclination was to say get the house first. But those were my priorities. As recent economic events have shown us, a house is not necessarily the grand investment many people have treated it as.

There are a lot of advantages though. Mortgage interest and property tax are tax deductible, your mortgage payment will not go up even when apartment rent does (as long as you're sane and get a fixed rate mortgage), there is a $8000 tax rebate for first time buyers now (until November and Congress is talking about increasing it to $15,000), interest rates on mortgages are sure to go up in the future, and you MAY be able to build equity when/if housing prices increase. For me, one of the biggest things was after 9 years of dorm rooms and apartments with noisy neighbors I wanted peace!

However, as you pointed out, there are negatives as well. What if you need to move because of your job or you meet someone? I would hate to have to try to sell now or in the near future. As a single woman I can say, yes, mowing the yard and raking leaves sucks, but you get used to it. I bought a house in good condition (one of my highest priorities) and haven't had anything major go wrong, so maintenance hasn't really been a problem yet. I learned to do a lot of stuff on my own and I call in someone for stuff I can't or don't want to do.

For me, I got the house first and the new car second, and I have no regrets. But if owning a house doesn't appeal to you, get the car -- however I don't recommend getting a car loan if you can pay in cash. If you could get a better interest rate on your savings than the interest you would pay on your car loan it would be worth it, but I doubt that's possible these days. The other reason to get a car loan would be if you need to build your credit for a future house (credit cards won't build your credit score like on-time loan payments will). Good luck!

Dude ... I am telling right now if I have an option of buying a house or a car....buy the house and if you get a 30 year mortage make one extra payment a year, and then you will have the house paid off in 15 years instead of 30. In 15 years the house will be worth alot more than the car.....

You can sleep in a car, you can't drive a house.

The decision is clear for me.

For the same size house as the apartment? No way... With that 2x payment, you are getting a MUCH larger house.

I say get the house and build some equity, then a year or so later get the Camaro. The house is an investment. Also, you can call someone to come fix a new house just like your apartment for the first year, and you can hire someone to mow your lawn. :sm0: