Long story but when my wife announced she wanted to have another baby we were in the middle of getting the financing to build our dream house. Paid cash for the land and had plans and all the details worked out. Couldn’t swing that and a stay at home mom too. So, we bought a house until she went back to work.
Lots changed since then. Fertility treatments, a premature baby, $100,000 in hospital bills, I’m back on active duty and she has a new career. So, Nine years later it’s time to move up.
We saw a nice house a block away but it was sold before we could act. It did however get me thinking. I’m in a three bedroom 2 bathroom townhouse with a finished basement. Rent in my neighborhood is around $1100 a month. Comps for my neighborhood ( all sold in the last three months) are all around $150,000. I paid $100,000 and owe $70,000.My mortgage with taxes is currently $760.00 per month. Lots of people want to be in this neighborhood because it’s the entry level for this school district and around here thats a big deal.
All the single families we are loooking at are around $300,000. I’m considering taking $40,000 of the equity out of my current house and buying the new one, keeping this one as a rental. I’m thinking I’ll end up with around a $950 a month mortgage here and $1800 to $2000 a month at the new house. If anything goes wrong we can sustain both mortgages.
My question is, at $150,000 market value and $1100 a month rent with a $950.00 a month mortgage, is this worth it? Or, is it a losing proposition.
Also, I’ll not have to move anywhere that I can’t commute to but I’ll most likely get deployed again. So, what is the usual management company fee? I don’t want my wife to have to worry abut two houses if I’m away.