If you had 20% down and no PMI to pay, it would probably make more sense. If you have to pay PMI, I think I'd just rent.
I also think I'd just rent if I was at less than four years of expected time in the home. You may find a diamond in the financial rough to make it worth it, but honestly, it seems like having the flexibility afforded by renting would be worth it. That's how I look at it anyway and why I keep renting, although some day I'd like to stop.
mtn wrote:ProDarwin wrote:Zip 61761. I did the calculations assuming $60,000 purchase price, $5,000 down, and assuming that it would LOSE value at 1% a year, as compared to $750 a month rent. To a certain extent, this area is in a little bubble and is relatively immune to the ups and downs of the economy--we're home to State Farm and Illinois State University, so the local economy and housing market typically will stay steady. According to Zillow, the market dropped about 7% from 2010 to 2012, and since then recovered most of that. There was basically no decline in 2008. http://www.zillow.com/towanda-il-61761/home-values/ But I'm taking note of the issues with a 1 bedroom being difficult to sell (or rent) down the road. Really wouldn't have thought of that on my own.mtn wrote: A little more info: I was all on board with the "rent for now" folks until I actually really put pencil to paper and factored it out. At this price point, I'd be breaking even in a little under 3 years if I buy vs rentWhat kind of returns is the real-estate market there showing? What zip or town? Its hard to make any calls without knowing that market, but good luck selling that 1 bedroom house down the road. That is exactly the reason I ended up with the house I did vs. building my own garage/dream home. The closer you are to the average 4 bed/3bath/2 car garage generic american home (or whatever the rest of the neighborhood is composed of), the better.
How solid is State Farm in IL? Investing big here..
http://www.ajc.com/news/business/state-farm-to-headline-massive-project-near-perime/ndPFs/
OHSCrifle wrote:mtn wrote:How solid is State Farm in IL? Investing big here.. http://www.ajc.com/news/business/state-farm-to-headline-massive-project-near-perime/ndPFs/ProDarwin wrote:Zip 61761. I did the calculations assuming $60,000 purchase price, $5,000 down, and assuming that it would LOSE value at 1% a year, as compared to $750 a month rent. To a certain extent, this area is in a little bubble and is relatively immune to the ups and downs of the economy--we're home to State Farm and Illinois State University, so the local economy and housing market typically will stay steady. According to Zillow, the market dropped about 7% from 2010 to 2012, and since then recovered most of that. There was basically no decline in 2008. http://www.zillow.com/towanda-il-61761/home-values/ But I'm taking note of the issues with a 1 bedroom being difficult to sell (or rent) down the road. Really wouldn't have thought of that on my own.mtn wrote: A little more info: I was all on board with the "rent for now" folks until I actually really put pencil to paper and factored it out. At this price point, I'd be breaking even in a little under 3 years if I buy vs rentWhat kind of returns is the real-estate market there showing? What zip or town? Its hard to make any calls without knowing that market, but good luck selling that 1 bedroom house down the road. That is exactly the reason I ended up with the house I did vs. building my own garage/dream home. The closer you are to the average 4 bed/3bath/2 car garage generic american home (or whatever the rest of the neighborhood is composed of), the better.
As well as in Phoenix and Dallas. But the corporate headquarters is quite solid in IL for at least 5-7 years, the jobs down there are almost all call center and IT jobs. However, the big investments down south are a big part of the reason that I would stay near the college campus.
You're running the numbers against renting, which means you need to be able to treat the house like a rental. It will work if you do nothing to the house for the 3-5 years you live in it. Where you get into trouble is spending $20k on that spare bedroom and only increasing the value of the home by $10k. Now how do the numbers look? If you're going to live there for 10 years then maybe you get $1000 a year in utility out of the extra room, but without that time...
Like most things in life, you need to make the best decision you can and then just jump. The factors that will control whether it works out (market, moving jobs, even kids) are largely out of your control.
You also need to be careful about adding living space (and thus value) to your house and what that might do to your taxes. I could easily add a second floor to my house and more than double the living space. However, my taxes are rather low and since I have no intention of moving anytime soon and I don't really 'need' the space, I'd rather invest in making what I have more enjoyable for me.
"How much does a house cost?" is pretty much like asking "How much does a car cost?"
It depends.
"How much does an addition cost per square foot?" Is pretty much like asking "How much does a car cost per tire?"
It's irrelevant.
SVreX wrote: "How much does a house cost?" is pretty much like asking "How much does a car cost?" It depends.
Uh... Did I ask that anywhere? (Serious question, because if that was how it came off I really need to work on my clarity).
I wasn't asking for the financial information on buying/maintaining a home, that just came out in the posts that followed. I really have that pretty well figured out.
I was asking what to look for in a house, physically, i.e. with pretty much every single car I look at, I'm looking under the oil cap for foam, or checking the frame, or looking closely for a repaint, or ...
The financial part I was asking about was a ballpark cost to add on a room, as well as ballpark cost to build a super basic 2 car garage. I guess I'll need to ask around here for that info though.
Id be interested in some more context on the house to formulate an opinion. Send me the address. I've had good success deciphering Illinois building codes and just had a garage built.
Prices are for a basic 2x4 wall vinyl siding, 1 garage door, 1man door on turndown slab with 4' appron garage in our area based on my experiences. Prices will vary some but should do a bakpark. DIY is going to run you around $12-15/sq ft in materials. Most contract quotes including those guys that advertise in our are that build in a day was about 25-27/sq ft.
A garage like mine which has gobs of windows tall Walls custom Room in attic trusses and finished electrical was a round $25/sq-ft in materials. Contractors quoted nearly $45/sqft to build it. I went with a combo approach day with some contracting and got to $35/sqft.
Additions we had one quoted for about 150/sqft. My neighbor had only foundation and framing done for ~$50 and then had to do all interior work himself for materials cost.
Again these are ballparks. I would estimate $7-12k for a 2 car garage and 20-25k for a 1 bedroom addition.
You can do cheaper than that though. Concrete is $110/yard around here, framing materials are cheap and you can save money and do T11 plywood type siding. I'm working with my brother in law to look at a 1 bedroom addition to his house and will have a better estimate for a bare bones cost soon.
In reply to mtn:
Ok. Regarding what to look for... Look for a good home inspector.
You look at cars because you understand what to look for. If you knew nothing about cars, would you do your own inspection, or hire a good mechanic?
Finding a good inspector- most suck. The professional and diligent ones understand their role is not to speculate on what might be wrong, but to report what is seen. That means don't report things you can't directly see. That leaves a lot of info out- it's a liability issue.
The non- professional ones don't have any idea what they are looking at. They are inexpensive, and frequently the ones the Realtors will recommend because they write a lightweight report which doesn't hurt the chances of closing the deal.
In every town, there is a home inspector that Realtors hate. He's know as "Deal Killer", because he writes 30 page detailed reports that always look scary, but include every paint drip and minor issue. He's arrogant, and not a very nice guy. He scares buyers, and kills deals.
This is the guy you want.
Just accept it for what it is. Don't get scared by his report, or use it to nit-pick the deal to death. Use his expertise to give you the details you want to make a good decision. His report will be comprehensive- that's good. Ignore the details and focus on the big important stuff.
As a builder, I used to specifically write this guy out of contracts. No kidding. We'd say, "You are welcome to any home inspector, except him". Because we understood most home buyers couldn't interpret his report, and it would kill the deal.
But that's the guy I hire when I am the buyer.
SVreX wrote: "How much does an addition cost per square foot?" Is pretty much like asking "How much does a car cost per tire?" It's irrelevant.
I know it's what you do, or have done in the past, but many contractors around here do use "price per sq ft" for houses/garages, etc with an idea of "bare bones is roughly X" while "top of the line is roughly X"
Is it exact? Of course not. Can it give you a general idea of what you might spend? Sure. Especially given the hypothetical context we are using now.
I've done bathroom additions for $2200.
I have also done a $65,000 bathroom addition.
There is no such thing as "How much does it cost to add a bathroom?"
The better question is, "How much bathroom can I build for $xxx?"
SVreX wrote: In reply to mtn: Ok. Regarding what to look for... Look for a good home inspector. ......
Any idea on how to find the deal killer?
FWIW, when I go to look at the place (and it really is just looking) I'm bringing a friend of mine from work who worked in fire claims for 10 years. He kinda knows what he's looking at. Obviously not an inspector, but I'm not at the point where I need an inspector yet.
mtn wrote: The financial part I *was* asking about was a ballpark cost to add on a room, as well as ballpark cost to build a super basic 2 car garage. I guess I'll need to ask around here for that info though.
I think his point was there are too many variables to even make a guess.
There is the "what the market will bear" factor depending on where you live. My previously mention ex- lives near Princeton, NJ ($$$$) and lives in a house she couldn't afford to buy today. Her initial estimates for the addition were roughly 2x what she finally paid.
There are the previously mentioned permiting costs (which fortunately for her were minimal, but she did have to apply for a variance and send certified copies of her plans to her neighbors since her house is in an historic area, although hers is far from original).
Can the house utilities support the addition?
All of this can vary greatly between townships and each individual house, so there is no simple formula.
SVreX wrote: I've done bathroom additions for $2200. I have also done a $65,000 bathroom addition. There is no such thing as "How much does it cost to add a bathroom?" The better question is, "How much bathroom can I build for $xxx?"
How much bedroom and bathroom can I build for $10,000? How much bedroom can I build, and bathroom can I rennovate for $10,000?
z31maniac wrote:SVreX wrote: "How much does an addition cost per square foot?" Is pretty much like asking "How much does a car cost per tire?" It's irrelevant.I know it's what you do, or have done in the past, but many contractors around here do use "price per sq ft" for houses/garages, etc with an idea of "bare bones is roughly X" while "top of the line is roughly X" Is it exact? Of course not. Can it give you a general idea of what you might spend? Sure. Especially given the hypothetical context we are using now.
I am trying to help.
Most builders use square footage pricing because they suck at pricing a job. Instead, they get really good at upcharging for "changes", or "unexpected items".
Is that who you want to hire?
mtn wrote:SVreX wrote: I've done bathroom additions for $2200. I have also done a $65,000 bathroom addition. There is no such thing as "How much does it cost to add a bathroom?" The better question is, "How much bathroom can I build for $xxx?"How much bedroom and bathroom can I build for $10,000? How much bedroom can I build, and bathroom can I rennovate for $10,000?
Not much.
The full bathroom remodel for small bathroom came in around $5500 IIRC. But that was paying someone else to do the work and replacing everything.
I remember we didn't take it down to the studs, but had them retexture the walls and remove the popcorn ceiling. Subway tiles in the bathtub, new nice fixtures, etc.
This for a an 80sq ft bathroom in an early 70s house.
mtn wrote:SVreX wrote: I've done bathroom additions for $2200. I have also done a $65,000 bathroom addition. There is no such thing as "How much does it cost to add a bathroom?" The better question is, "How much bathroom can I build for $xxx?"How much bedroom and bathroom can I build for $10,000? How much bedroom can I build, and bathroom can I rennovate for $10,000?
Not much. (One wise crack deserves another) 
The point is that no one can give a good answer without more details.
So, can you do it yourself? Will you be doing your own licensed work? Will you be relocating fixtures, or just swapping? Will you be adding a heating system? How much glass? How high is the foundation? How many grading issues? How is the access? Know anything about electrical? Will you be hiring a contractor? Who is doing the plans? Does the house have brick? Etc etc.
If you want the answer most contractors will give, an addition will cost you about $55 per SF.
That is a made up number. It can be renegotiated later.
Real budget should be about $80-100 per SF for a contracted addition in most rural areas. Half that if you do it yourself. Double that in major metropolitan areas.
Which gives a range of $40-200.
That is almost identical to the percentage of variance between an Elantra and a nice BMW, when costed on a price per wheel basis.
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